Citicorp said it plans to buy back from investors up to $3 billion of its stock during the next two years.
The banking company may buy back either its common shares or its convertible preferred shares, which can be converted into common stock. Based on current stock prices, the buyback would represent about 13 percent of the company's common shares, or 10 percent of its shares when assuming the conversion of the preferred stock.Citicorp said it plans the buyback because it has reserves of more than $5 billion and is generating more capital than it needs to fund its business growth. The company plans to use the repurchased shares to compensate for shares issued under employee benefit programs and in connection with preferred-stock conversions.
The shares will be bought back in the open market or in private transactions.