Nobody is calling it nationalization, but the U.S. Treasury and Citigroup are close to an agreement that would give the federal government a 40 percent stake in the banking giant. In exchange, the feds would bolster Citi's badly depleted capital base. (Here's the FT story.) Talks have been ongoing for the last few days and an announcement could happen as early as Wednesday. The deal would have the government convert its preferred shares into common stock, a move that would further dilute other shareholders' stakes. Lots of details TBA and the whole shebang might still fall apart.
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