According to a statement from Citigroup, the stock swap would boost the government's share of the company's common stock from 8% to 36%, making it the single largest Citigroup shareholder. It's the major component of a Citigroup plan to exchange $27.5 billion of existing preferred securities for common stock, intended to increase the company's tangible common equity from its Q4 2008 level of $29.7 billion to as much as $81 billion.

As part of the plan, dividends will be suspended on both preferred shares and the converted common shares, according to Citigroup. Other major participants in the exchange include the Government of Singapore Investment Corp., HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud, Capital Research Global Investors and Capital World Investors.

A Treasury release states that Citigroup will look to replace many of its board of directors "as soon as feasible," although CEO Vikram Pandit will remain in place. In a statement, Citigiroup chairman Richard Parsons says the board presently has 15 directors, "three of whom have announced that they will not be standing for election at the April annual meeting and two of whom will reach retirement age by the time of the meeting. We are actively conducting a search and expect to announce several new directors shortly."