Citigroup plans to price 15-year callable leveraged CMS spread notes

By Angela McDaniels

Tacoma, Wash., June 9 - Citigroup Funding Inc. plans to price callable leveraged CMS spread notes due June 30, 2025, according to an FWP filing with the Securities and Exchange Commission.

The coupon will be 10% for the first year. After that time, the rate will be 4.5 times the spread of the 10-year Constant Maturity Swap rate over the two-year CMS rate, subject to a maximum of 10% to 12% per year in each interest period and a floor of zero. The exact cap will be set at pricing. Interest will be payable quarterly.

The payout at maturity will be par.

Beginning June 30, 2013, the notes will be callable at par on any interest payment date.

The notes are expected to price June 25 and settle June 30.

Citigroup Global Markets Inc. is the underwriter.

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