US bails out Citigroup with $20b

NEW YORK: Citigroup Inc has got a second lifeline from the US government.

The Bush administration agreed on Sunday (yesterday morning Beijing time) to inject $20 billion of new capital and shoulder most of the bank's potential losses on $306 billion of high-risk assets.

This is the government's biggest move to rescue a bank in order to contain a widening financial meltdown that has caused the disappearance or bankruptcies of financial giants such as Bear Stearns, Lehman Brothers Holdings and Washington Mutual.