Citigroup Inc., under pressure to rapidly downsize, is preparing to unveil a major reorganization as a further step toward dismantling the financial conglomerate, according to people familiar with the matter.

In addition to spinning off its Smith Barney retail brokerage unit into a joint venture with Morgan Stanley, Citigroup is preparing to narrow its corporate mission to two areas, these people said. The company plans to focus on wholesale banking for large corporate clients and retail banking for customers in selected markets around the world, people with knowledge of the discussions said Tuesday.

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