Treasury Expects Big Taxpayer Haul On Citigroup Bailout

The wildly unpopular $45 billion bailout of banking giant Citigroup looks like it will generate a positive return for taxpayers, according to the Treasury.

So far, the government’s $45 billion total investment in Citi under the Troubled Asset Relief Program has yielded proceeds of $41.6 billion, and the government’s remaining stake in Citigroup is worth $14 billion. The Treasury also said taxpayers stand to rake in additional cash from the sale of Citi warrants issued to the government as part of TARP. Plus, the FDIC will eventually be offloading somewhere around $800 million in Citi Trust Preferred Securities.

The news came as the Treasury Department today announced it had priced a planned offering of Citigroup trust preferred securities, and the result is a profit of $2.25 billion for the American taxpayer. The deal is set to close on Oct. 5.

The Treasury said it has sold about 4.1 billion common shares in Citigroup for about $16.4 billion. Its current stake in the megabank is now around 12 percent.

mtaylor@observer.com

Twitter: @mbrookstaylor

Treasury Expects Big Taxpayer Haul On Citigroup Bailout