By Maria Aspan
NEW YORK (Reuters) - Citigroup Inc
The third-largest U.S. bank, which needed $45 billion in U.S. government bailouts to survive the financial crisis, said in March it planned to reinstate a 1-cent quarterly dividend, after shrinking its number of shares outstanding with a 1-for-10 reverse stock split.
The split took effect on Monday, reducing Citigroup's share count to 2.9 billion from 29 billion.
Investors, who see reverse splits as cosmetic fixes to what are often fundamental problems, have not rewarded Citigroup. The bank's shares are down more than 6 percent since they started trading on a split-adjusted basis on Monday. They were down 38 cents to $42.04 Friday morning.
Citigroup last paid a 1-cent dividend in February 2009 as it teetered on the brink of collapse during the crisis. Its quarterly dividend peaked at 54 cents per share in 2007.
Chief Executive Vikram Pandit has said the bank will likely wait until 2012 to increase the amount of capital it returns to shareholders, through increased dividends or share buybacks.
The U.S. government has sold all of the common shares it took in the bank as part of its bailouts, but Citigroup is still struggling to grow its revenues.
(Reporting by Maria Aspan, editing by Gerald E. McCormick and John Wallace)
