Citigroup may raise $616 mln with Brazil card unit

SAO PAULO (Reuters) - Citigroup Inc may raise 1.08 billion reais ($616.1 million) with the sale of a stake in its Brazilian credit card unit as the largest U.S. bank seeks funds to shore up its balance sheet.

Citigroup plans to sell 41.13 million shares of Redecard, according to a prospectus of the sale, filed on Tuesday. The shares fell 6.9 percent to 26.3 reais in late afternoon trading.

Citigroup, Itau Holding Financeira and Unibanco filed to sell shares of Redecard in a secondary offering, though the Brazilian banks did not disclose the number of shares they plan to sell.

Earlier Tuesday, the U.S. bank said it plans to raise $14.5 billion from a group of investors to help shore up its balance sheet after taking huge write-down for losses related to a slump in credit markets.

Citigroup, Redecard's biggest shareholder, holds a 24 percent stake in the credit card company with 161.2 million shares, followed by Itau and Unibanco, each with 23.2 percent.

Redecard's initial public offering last July raised nearly 4 billion reais, with most of the funds going to banks cashing out of the company, including Citigroup, Unibanco and Itau.

Itau BBA, the investment banking unit of Itau, is the lead manager of Redecard's share offering.

($1 = 1.753 Brazilian reais)

(Reporting by Elzio Barreto; Editing by Steve Orlofsky)