Citigroup Inc. is reportedly mulling over a plan to sell government shares in order to reduce taxpayer's 34 per cent stake.

Intimate sources informed that Citigroup executives plan to present the idea to the Treasury Department.

The New York-based lender has been among the hardest hit by the recent economic slump.

To emerge from recession, Citigroup received $45 billion in bailout funds from the government. Recently a portion of that bailout fund was converted into 34 per cent ownership stake in the lender.

According to the reports, government would sell an undetermined number of shares, while Citigroup is expected to sell around $5 billion in new shares.

The money lifted by issuing new shares will be utilized to return a portion of the government bailout funds.

In the after-hour trading, shares in Citigroup closed at $4.52, losing 2.9 per cent.