Citi soars as feds cash out

December 8, 2010, 2:15 AM UTC

It’s time to break up Citigroup.

A day after the government announced the sale of its last shares of its biggest bank bailout of the 2008-2009 meltdown, Citi (C) shares rose 3% to their highest level since April.

Treasury's happy timing

Treasury raised $10 billion and change Tuesday by selling 2.4 billion Citi shares in an offering underwritten by Morgan Stanley. The deal left the feds, savaged recently for their massive lending to the financial sector during the crisis, sitting on a $12 billion profit from the Citi bailout.

Tuesday’s rally means Citi shares posted a double-digit percentage gain over the year in which Treasury sold off what was at one point a 27% stake. So much for overwhelming the market.