Around noon in New York, Citi shares were up 3.8% at $4.62, according to The Wall Street Journal.
The paper notes the sale means the stock will be eligible for greater ownership in major indexes. The Standard & Poor's 500 didn't count the Treasury Department's shares in its current weighting of Citi, said David Trone, an analyst at JMP Securities. By the agency exiting the investment, the index will increase its weighting of Citi, which in turn means index mutual funds, exchange-traded funds and institutions will buy Citi shares.
Recent regulatory filings put institutional ownership of Citi common shares at 48.8%, according to Sandler O'Neill. Assuming all the buyers of the Treasury Department's last sale of 2.4 billion shares are institutions, that percentage would rise to 56.5%, still well below the average large-capitalization bank institutional ownership of 73.9%.