Newly-installed Chief Executive Vikram Pandit, scrambling to slash costs and assets hard hit by the credit crunch, also intends to reaffirm his promise to cut annual expenses by around a fifth, the source said on Thursday.

Citigroup declined to comment.

The sales could amount to nearly 20 per cent of Citi?s current assets, and according to the Financial Times, which first reported the story on Thursday, would take place over several years.

Although Citi has said previously that it plans to shed assets to improve its capital position, the magnitude of the potential sales struck some analysts as worrisome.

'The only reason you?d sell off that many assets is you have a lot more losses coming than you originally thought,'said Mr Jim Huguet, co-chief executive at fund manager Great Companies LLC, which does not own Citi shares.

Since late last year, Citi has recorded more than US$45 billion of writedowns and credit losses, raised more than US$40 billion of new capital including US$2 billion of preferred shares this week, and slashed its dividend 41 per cent.

Precisely which non-core assets are for sale is unclear, but analysts speculated that consumer finance businesses in the United States, Japan, Mexico, and Germany are possible.

The source requested anonymity because the plan had not yet been announced.

Investors are impatient for improvement at Citi, whose share price has fallen more than 55 per cent over the last year. Mr Pandit has faced demands from investors that he slash costs, shed poorly performing businesses and even split up the bank.

Some investors view Citi, built over two decades by Sanford 'Sandy' Weill, as too big to govern, a charge that Weill's hand-picked successor, Mr Charles Prince, routinely denied.

Mr Pandit and other executives are expected to also fend off calls for a break-up on Friday when the company offers a four-hour presentation to investors and analysts.

They are instead expected to tout Citi's combination of consumer and institutional businesses, and recommend selling operations and assets outside those main areas.

Consumer finance, Student Loans, Trading
Citi's US student loan business may make sense to sell, after recent legislative changes and turmoil in the securitisation market have made the business less profitable, an analyst said.

The Wall Street Journal this week reported Citi may sell Primerica, a consumer sales network for life insurance and investments.

Citi should also look to sell assets on its trading books, hich have contributed to much of the writedowns that bank has taken so far, said Mr Thomas Russo, partner at asset manager Gartner Russo & Gartner.

'It all depends on the price they get and how they do it, but if they can do it over time, and swear off the stuff, it could be good for Citi,' said Mr Russo.

Another fund manager added that Mr Pandit's presentation of the plan may prove to be a turning point for Citi.

'Until we see the details, it's hard to know. Philosophically, I think it ought to be viewed positively,' said Mr Anthony Muh, head of Asia Pacific for AT Asset Management in Hong Kong, which manages about $1 billion in Asian equities, but does not hold any Citi shares.

Investors have in recent weeks grown increasingly hopeful about the US financial sector moving closer to the end of its difficulties. Citi's shares have risen 30 per cent since mid-March, and closed on Thursday in New York at US$24.30.But concerns still remain about Citi - its shares still trade at about their book value, while healthier banks? shares typically trade well above their book value.

Citi's 'Tier 1' capital ratio - a measure of the bank's capital strength - is above 8.6 per cent, based on March balance sheet figures and recent capital raising efforts.

That's above the bank's internal targets, but the fact that Citi continues to raise equity, having issued perpetual preferred securities this week, makes some analysts wonder whether future writedowns will continue to be large.

Citi's balance sheet currently weighs in at more than US$2.2 trillion, though much of that comprises businesses and trading positions outside its key businesses: commercial, consumer and investment banking.

Mr Pandit already has sold the bank's stake in CitiStreet benefits servicing venture, commercial leasing business CitiCapital and the Diners Club charge card business.

Another highlight of the meeting will be plans to slash as much as US$15 billion off operating expenses. Last year, Citi's costs totalled more than US$61 billion.

The bank has announced 13,200 job cuts in 2008, though analysts say tens of thousands of further cuts may be needed.

The bank ended March with 369,000 employees. -- REUTERS