NEW YORK - STILL licking its wounds following a failed bid to buy Wachovia, Citigroup is on the prowl again and is in talks to acquire a regional bank, according to media reports on Monday.

The Wall Street Journal reported that Citigroup is looking to acquire a regional bank that overlaps the geography of its retail operations, less than a month after it walked away from Wachovia.

A Citigroup representative was not immediately available for comment.

In an effort aided by the Federal Deposit Insurance, Citigroup tried to acquire Wachovia before Wells Fargo made a larger offer that did not rely on help from the government.

After various lawsuits were filed over who was the rightful purchaser of Wachovia, Citigroup withdrew its bid.

Wells Fargo is proceeding with its bid - valued at US$12.7 billion (S$18.9 billion) in stock - and expects the acquisition of the Charlotte, North Carolina-based bank to close by the end of the year.

Many analysts have expected Citigroup to strike again, and the bank has said it would likely use a US$25 billion investment from the government - part of the US$700 billion financial rescue package passed by Congress last month - to take advantage of opportunities in the market.

But the company's third-quarter results heightened concerns that Citi - hampered by the relentless downturn in housing and turmoil in the financial markets - may not be in the best position to make an acquisition.

Of the four major US banks - Citigroup, JPMorgan Chase, Bank of America and Wells Fargo - Citi has been on the shakiest footing, reporting losses in the past four consecutive quarters while its rivals have managed to post profits, albeit dampened ones.

Analysts polled by Thomson Reuters, on average, expect the New York-based bank to record quarterly losses through the first quarter of next year.

Last month, Citigroup said it lost US$2.8 billion, or 60 cents per share, during the third quarter. The deficit for the July-to-September period brings Citi's total losses over the past 12 months to US$20.2 billion.

The bank has written down the value of investments tied to souring mortgages and other bad debt by some US$51 billion since the end of the third quarter last year - the most of any other bank.

Citigroup has also forfeited the title of largest US bank by assets as its competitors have made major acquisitions to bolster their operations amid the economic downturn.

Aside from Wells Fargo acquiring Wachovia, JPMorgan bought Bear Stearns in March and acquired Washington Mutual in September after the Seattle-based bank was seized by federal regulators.

Meanwhile, Bank of America acquired troubled mortgage lender Countrywide Financial Corp. and investment bank Merrill Lynch this year.

Citigroup shares fell 24 cents, or 2 per cent, to US$11.58 in morning trading. Shares have traded between US$11.31 and US$37.50 in the past 12 months. -- AP