UPDATE 1-E*Trade says investors tender $1.84 bln in swap

* Investors tendered $1.84 bln of notes due in 2011, 2017

* E*Trade will issue $1.7 billion of new convertible debt

* Shares fell 2.96 percent to $1.31 in early trading

NEW YORK, July 2 (Reuters) - E*Trade Financial Corp (ETFC.O), a discount brokerage under regulatory pressure to shore up capital, said on Thursday that investors tendered $1.84 billion of the company's bonds in a swap for new debt.

The brokerage said about $429.5 million of notes due in 2011 and $1.41 billion of notes due in 2017 were tendered before an early tender period expired.

The notes will be swapped for around $1.7 billion of newly issued zero-coupon convertible debt due in 2019.

E*Trade said the Chicago-based hedge fund Citadel Investment Group LLC, its largest debt and equity investor, tendered $230.2 million of the 2011 notes and $1 billion of the 2017 notes.

E*Trade has had significant credit losses in mortgages, offsetting the benefits from its trading business.

Last week, E*Trade said it raised $550 million from a common stock offering, more than the New York-based company expected.

In early trading on the Nasdaq, E*Trade shares slipped 4 cents to $1.31. (Reporting by Juan Lagorio, editing by Maureen Bavdek)