The US Treasury will purchase a $20 billion stake in troubled bank Citigroup in the latest government bail-out deal, according to the Times Online.
Under the terms of the deal, the Treasury will take a $20 billion stake in the bank in return for guaranteeing around $306bn (205bn) of risky assets on Citigroup’s balance sheet.
The plan, announced jointly by the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC), was put in place after the bank’s share price plunged last week, halving its market value and raising fears over its future.
Last week, the company announced 52,000 job losses worldwide, on top of 23,000 job cuts previously announced. Citigroup employs 12,000 people in the UK and it is understood that around 2,000 London jobs will be lost through the most recent cull.