Citigroup Inc. on Tuesday offered about $2 billion in $25 par 30-year trust-preferred securities as part of its agreement with regulators on repaying federal bailout funds.

In December, Citigroup agreed to sell these securities to raise its capital ratios after it repaid $20 billion in trust-preferred securities held by the Treasury Department.

The securities offered Tuesday are expected to yield roughly 8.875% and draw plenty of demand from institutional and retail investors, according to a person familiar with the deal.

The securities are expect to have ratings of Ba1/BB-minus.

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