The information in this preliminary pricing supplement is not
complete and may be changed. A registration statement relating to
these securities has been filed with the Securities and Exchange
Commission. This preliminary pricing supplement and the
accompanying prospectus supplement and prospectus are not an offer
to sell these securities, nor are they soliciting an offer to buy
these securities, in any state where the offer or sale is not
permitted.
SUBJECT TO COMPLETION, DATED NOVEMBER 29, 2022
|
Citigroup Global Markets Holdings
Inc. |
December -----,
2022
Medium-Term Senior Notes, Series N
Pricing Supplement No. 2022-USNCH15144
Filed Pursuant to Rule 424(b)(2)
Registration Statement Nos. 333-255302 and 333-255302-03
|
Callable Fixed Rate Notes Due December 16, 2025
|
· |
The notes mature on the maturity date specified
below. We have the right to call the notes for mandatory
redemption prior to maturity on a periodic basis on the redemption
dates specified below. Unless previously redeemed, the
notes pay interest periodically at the fixed per annum rate
indicated below. |
|
· |
The notes are unsecured debt securities issued by Citigroup
Global Markets Holdings Inc. and guaranteed by Citigroup Inc.
All payments on the notes are subject to the credit risk of
Citigroup Global Markets Holdings Inc. and Citigroup Inc. |
|
· |
It is important for you to consider the information
contained in this pricing supplement together with the information
contained in the accompanying prospectus supplement and prospectus.
The description of the notes below supplements, and to the extent
inconsistent with replaces, the description of the general terms of
the notes set forth in the accompanying prospectus supplement and
prospectus. |
KEY
TERMS |
Issuer: |
Citigroup Global Markets Holdings
Inc., a wholly owned subsidiary of Citigroup Inc. |
Guarantee: |
All payments due on the notes are fully and unconditionally
guaranteed by Citigroup Inc. |
Stated principal
amount: |
$1,000 per note |
Pricing date: |
December 14, 2022 |
Original issue
date: |
December 16, 2022 |
Maturity date: |
December 16, 2025. If the maturity date is not a
business day, then the payment required to be made on the maturity
date will be made on the next succeeding business day with the same
force and effect as if it had been made on the maturity
date. No additional interest will accrue as a result of
delayed payment. |
Payment at
maturity: |
$1,000 per note plus any accrued and unpaid
interest |
Interest rate per
annum: |
From and including the original issue date to but excluding
the maturity date, unless previously redeemed by us: 5.35% |
Interest
period: |
The period from and including the original issue date to but
excluding the immediately following interest payment date, and each
successive period from and including an interest payment date to
but excluding the next interest payment date. |
Interest payment
dates: |
Semi-annually on the 16th day of each June and December of each
year, commencing June 16, 2023, provided that if any such day is
not a business day, the applicable interest payment will be made on
the next succeeding business day. No additional interest will
accrue on that succeeding business day. Interest will be payable to
the persons in whose names the notes are registered at the close of
business on the business day preceding each interest payment date,
which we refer to as a regular record date, except that the
interest payment due at maturity or upon earlier redemption will be
paid to the persons who hold the notes on the maturity date or
earlier date of redemption, as applicable. |
Day count
convention: |
30/360 Unadjusted. See “Determination of Interest Payments” in
this pricing supplement. |
Redemption: |
Beginning on December 16, 2023, we have the right to call the notes
for mandatory redemption, in whole and not in part, on any
redemption date and pay to you 100% of the principal amount of the
notes plus accrued and unpaid interest to but excluding the
date of such redemption. If we decide to redeem the notes, we will
give you notice at least five business days before the redemption
date specified in the notice.
So long as the notes are represented by global securities and are
held on behalf of The Depository Trust Company (“DTC”), redemption
notices and other notices will be given by delivery to DTC. If the
notes are no longer represented by global securities and are not
held on behalf of DTC, redemption notices and other notices will be
published in a leading daily newspaper in New York City, which is
expected to be The Wall Street Journal.
|
Redemption
dates: |
The 16th day of each March, June, September and December,
beginning in December 2023, provided that if any such day is
not a business day, the applicable redemption date will be the next
succeeding business day. No additional interest will accrue as a
result of such delay in payment. |
Business day: |
Any day that is not a Saturday or Sunday and that, in New York
City, is not a day on which banking institutions are authorized or
obligated by law or executive order to close |
Business day
convention: |
Following |
CUSIP / ISIN: |
17330YMF4 / US17330YMF42 |
Listing: |
The notes will not be listed on any securities exchange. |
Underwriter: |
Citigroup Global Markets Inc. (“CGMI”), an affiliate of the
issuer, acting as principal. See “General Information—Supplemental
information regarding plan of distribution; conflicts of interest”
in this pricing supplement. |
Underwriting fee and issue
price: |
Issue price(1) |
Underwriting fee(2) |
Proceeds to issuer |
Per
note: |
$1,000.00 |
$ |
$ |
Total: |
$ |
$ |
$ |
(1) The issue price for eligible institutional investors and
investors purchasing the notes in fee-based advisory accounts will
vary based on then-current market conditions and the negotiated
price determined at the time of each sale; provided,
however, that the issue price for such investors will not be
less than $993.00 per note and will not be more than $1,000 per
note. The issue price for such investors reflects a
forgone selling concession or underwriting fee with respect to such
sales as described in footnote (2) below. See “General
Information—Fees and selling concessions” in this pricing
supplement.
(2) CGMI will receive an underwriting fee of up to $7.00 per note,
and from such underwriting fee will allow selected dealers a
selling concession of up to $7.00 per note depending on market
conditions that are relevant to the value of the notes at the time
an order to purchase the notes is submitted to
CGMI. Dealers who purchase the notes for sales to
eligible institutional investors and/or to investors purchasing the
notes in fee-based advisory accounts may forgo some or all selling
concessions, and CGMI may forgo some or all of the underwriting fee
for sales it makes to eligible institutional investors and/or to
investors purchasing the notes in fee-based advisory
accounts. The per note underwriting fee in the table
above represents the maximum underwriting fee payable per
note. The total underwriting fee and proceeds to issuer
in the table above give effect to the actual total proceeds to
issuer. You should refer to “Risk Factors” and “General
Information—Fees and selling concessions” in this pricing
supplement for more information. In addition to the underwriting
fee, CGMI and its affiliates may profit from expected hedging
activity related to this offering, even if the value of the notes
declines. See “Use of Proceeds and Hedging” in the accompanying
prospectus.
Investing in the notes involves risks not associated with an
investment in conventional fixed rate debt securities. See “Risk
Factors” beginning on page PS-2.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of the notes or
determined that this pricing supplement and the accompanying
prospectus supplement and prospectus are truthful or complete. Any
representation to the contrary is a criminal offense.
You should read this pricing supplement together with the
accompanying prospectus supplement and prospectus, each of which
can be accessed via the following hyperlink:
Prospectus
Supplement and Prospectus each dated May 11,
2021
The notes are not bank deposits and are not insured or
guaranteed by the Federal Deposit Insurance Corporation or any
other governmental agency, nor are they obligations of, or
guaranteed by, a bank.
Citigroup Global Markets Holdings Inc. |
|
Risk Factors
The following is a non-exhaustive list of certain key risk
factors for investors in the notes. You should read the risk
factors below together with the risk factors included in the
accompanying prospectus supplement and in the documents
incorporated by reference in the accompanying prospectus, including
Citigroup Inc.’s most recent Annual Report on Form 10-K and any
subsequent Quarterly Reports on Form 10-Q, which describe risks
relating to the business of Citigroup Inc. more generally. We also
urge you to consult your investment, legal, tax, accounting and
other advisors before you decide to invest in the notes.
|
§ |
The notes may be
redeemed at our option, which limits your ability to accrue
interest over the full term of the notes. We may redeem the
notes, in whole but not in part, on any redemption date, upon not
less than five business days’ notice. In the event that we redeem
the notes, you will receive the principal amount of the notes and
any accrued and unpaid interest to but excluding the applicable
redemption date. In this case, you will not have the opportunity to
continue to accrue and be paid interest to the maturity date of the
notes. |
|
§ |
Market interest
rates at a particular time will affect our decision to redeem the
notes. It is more likely that we will call the notes for
redemption prior to their maturity date at a time when the interest
rate on the notes is greater than that which we would pay on a
comparable debt security of ours (guaranteed by Citigroup Inc.)
with a maturity comparable to the remaining term of the notes.
Consequently, if we redeem the notes prior to their maturity, you
may not be able to invest in other securities with a similar level
of risk that yield as much interest as the notes. |
|
§ |
The notes are
subject to the credit risk of Citigroup Global Markets Holdings
Inc. and Citigroup Inc., and any actual or perceived changes to the
creditworthiness of either entity may adversely affect the value of
the notes. You are subject to the credit risk of Citigroup
Global Markets Holdings Inc. and Citigroup Inc. If Citigroup Global
Markets Holdings Inc. defaults on its obligations under the notes
and Citigroup Inc. defaults on its guarantee obligations, your
investment would be at risk and you could lose some or all of your
investment. As a result, the value of the notes will be affected by
changes in the market’s view of the creditworthiness of Citigroup
Global Markets Holdings Inc. or Citigroup Inc. Any decline, or
anticipated decline in the credit ratings of either entity, or any
increase or anticipated increase in the credit spreads of either
entity, is likely to adversely affect the value of the
notes. |
|
§ |
The notes will not
be listed on any securities exchange and you may not be able to
sell them prior to maturity. The notes will not be listed on
any securities exchange. Therefore, there may be little or no
secondary market for the notes. CGMI currently intends to make a
secondary market in relation to the notes and to provide an
indicative bid price for the notes on a daily basis. Any indicative
bid price for the notes provided by CGMI will be determined in
CGMI’s sole discretion, taking into account prevailing market
conditions and other relevant factors, and will not be a
representation by CGMI that the notes can be sold at that price or
at all. CGMI may suspend or terminate making a market and providing
indicative bid prices without notice, at any time and for any
reason. If CGMI suspends or terminates making a market, there may
be no secondary market at all for the notes because it is likely
that CGMI will be the only broker-dealer that is willing to buy
your notes prior to maturity. Accordingly, an investor must be
prepared to hold the notes until maturity. |
|
§ |
Immediately
following issuance, any secondary market bid price provided by
CGMI, and the value that will be indicated on any brokerage account
statements prepared by CGMI or its affiliates, will reflect a
temporary upward adjustment. The amount of this temporary
upward adjustment will steadily decline to zero over the temporary
adjustment period. See “General Information—Temporary
adjustment period” in this pricing supplement. |
|
§ |
Secondary market
sales of the notes may result in a loss of principal. You will
be entitled to receive at least the full stated principal amount of
your notes, subject to the credit risk of Citigroup Global Markets
Holdings Inc. and Citigroup Inc., only if you hold the notes to
maturity or redemption. If you are able to sell your notes in the
secondary market prior to maturity or redemption, you are likely to
receive less than the stated principal amount of the
notes. |
|
§ |
The inclusion of
underwriting fees and projected profit from hedging in the issue
price is likely to adversely affect secondary market prices.
Assuming no changes in market conditions or other relevant factors,
the price, if any, at which CGMI may be willing to purchase the
notes in secondary market transactions will likely be lower than
the issue price since the issue price of the notes will include,
and secondary market prices are likely to exclude, any underwriting
fees paid with respect to the notes, as well as the cost of hedging
our obligations under the notes. The cost of hedging includes the
projected profit that our affiliates may realize in consideration
for assuming the risks inherent in managing the hedging
transactions. The secondary market prices for the notes are also
likely to be reduced by the costs of unwinding the related hedging
transactions. Our affiliates may realize a profit from the expected
hedging activity even if the value of the notes declines. In
addition, any secondary market prices for the notes may differ from
values determined by pricing models used by CGMI, as a result of
dealer discounts, mark-ups or other transaction costs. |
|
§ |
The price at which
you may be able to sell your notes prior to maturity will depend on
a number of factors and may be substantially less than the amount
you originally invest. A number of factors will influence the
value of the notes in any secondary market that may develop and the
price at which CGMI may be willing to purchase the notes in any
such secondary market, including: interest rates in the market and
the volatility of such rates, the time remaining to maturity of the
notes, hedging activities by our affiliates, any fees and projected
hedging fees and profits, expectations about whether we are likely
to redeem the notes and any actual or anticipated changes in the
credit ratings, financial condition and results of either Citigroup
Global Markets Holdings Inc. or Citigroup Inc. The value of the
notes will vary and is likely to be less than the issue price at
any time prior to maturity or redemption, and sale of the notes
prior to maturity or redemption may result in a loss. |
Citigroup Global Markets Holdings Inc. |
|
General Information |
Temporary
adjustment period: |
For a period of approximately three months
following issuance of the notes, the price, if any, at which CGMI
would be willing to buy the notes from investors, and the value
that will be indicated for the notes on any brokerage account
statements prepared by CGMI or its affiliates (which value CGMI may
also publish through one or more financial information vendors),
will reflect a temporary upward adjustment from the price or value
that would otherwise be determined. This temporary upward
adjustment represents a portion of the hedging profit expected to
be realized by CGMI or its affiliates over the term of the notes.
The amount of this temporary upward adjustment will decline to zero
on a straight-line basis over the three-month temporary adjustment
period. However, CGMI is not obligated to buy the notes
from investors at any time. See “Risk Factors—The notes
will not be listed on any securities exchange and you may not be
able to sell them prior to maturity.” |
U.S. federal income tax
considerations: |
The notes will be treated for U.S. federal income tax purposes as
fixed rate debt instruments that are issued without original issue
discount.
Both U.S. and non-U.S. persons considering an investment in the
notes should read the discussion under “United States Federal Tax
Considerations” in the accompanying prospectus supplement for more
information regarding the U.S. federal income tax consequences of
an investment in the notes.
|
Trustee: |
The Bank of New York Mellon (as trustee under an indenture
dated March 8, 2016) will serve as trustee for the notes. |
Use of proceeds and
hedging: |
The net proceeds received from the sale of the notes will be used
for general corporate purposes and, in part, in connection with
hedging our obligations under the notes through one or more of our
affiliates.
Hedging activities related to the notes by one or more of our
affiliates involves trading in one or more instruments, such as
options, swaps and/or futures, and/or taking positions in any other
available securities or instruments that we may wish to use in
connection with such hedging and may include adjustments to such
positions during the term of the notes. It is possible that our
affiliates may profit from this hedging activity, even if the value
of the notes declines. Profit or loss from this hedging activity
could affect the price at which Citigroup Global Markets Holdings
Inc.’s affiliate, CGMI, may be willing to purchase your notes in
the secondary market. For further information on our use of
proceeds and hedging, see “Use of Proceeds and Hedging” in the
accompanying prospectus.
|
ERISA and IRA purchase
considerations: |
Please refer to “Benefit Plan Investor Considerations” in the
accompanying prospectus supplement for important information for
investors that are ERISA or other benefit plans or whose underlying
assets include assets of such plans. |
Fees and selling
concessions: |
The issue price is $1,000 per note; provided that the issue
price for an eligible institutional investor or an investor
purchasing the notes in a fee-based advisory account will vary
based on then-current market conditions and the negotiated price
determined at the time of each sale. The issue price for such
investors will not be less than $993.00 per note and will not be
more than $1,000 per note. The issue price for such investors
reflects a forgone selling concession with respect to such sales as
described in the next paragraph.
CGMI, an affiliate of Citigroup Global Markets Holdings Inc., is
the underwriter of the sale of the notes and is acting as
principal. CGMI may resell the notes to other securities
dealers at the issue price of $1,000 per note less a selling
concession not in excess of the underwriting fee. CGMI will receive
an underwriting fee of up to $7.00 per note, and from such
underwriting fee will allow selected dealers a selling concession
of up to $7.00 per note depending on market conditions that are
relevant to the value of the notes at the time an order to purchase
the notes is submitted to CGMI. Dealers who purchase the
notes for sales to eligible institutional investors and/or to
investors purchasing the notes in fee-based advisory accounts may
forgo some or all selling concessions, and CGMI may forgo some or
all of the underwriting fee for sales to it makes to eligible
institutional investors and/or to investors purchasing the notes in
fee-based advisory accounts.
|
Supplemental information
regarding plan of |
The terms and conditions set forth in the Amended and Restated
Global Selling Agency Agreement dated April 7, 2017 among Citigroup
Global Markets Holdings Inc., Citigroup Inc. and the agents named
therein, including CGMI, govern the sale and purchase of the
notes.
|
Citigroup Global Markets Holdings Inc. |
|
distribution; conflicts of
interest: |
In order to hedge its obligations under the notes, Citigroup Global
Markets Holdings Inc. expects to enter into one or more swaps or
other derivatives transactions with one or more of its affiliates.
You should refer to the section “General Information—Use of
proceeds and hedging” in this pricing supplement and the section
“Use of Proceeds and Hedging” in the accompanying prospectus.
For the portion of the notes for which Morgan Stanley & Co. LLC
(“MS”) acts as a selected dealer, CGMI will sell the notes to MS at
the initial price to public set forth on the cover page of this
pricing supplement less a concession not in excess of 0.7% of the
face amount.
See “Plan of Distribution; Conflicts of Interest” in the
accompanying prospectus supplement for more information.
|
Paying agent: |
Citibank, N.A. will serve as paying agent and registrar and
will also hold the global security representing the notes as
custodian for The Depository Trust Company (“DTC”). |
Contact: |
Clients may contact their local brokerage representative. Third
party distributors may contact Citi Structured Investment Sales at
(212) 723-7005. |
We encourage you to also read the accompanying prospectus
supplement and prospectus, which can be accessed via the hyperlink
on the cover page of this pricing supplement.
Determination of Interest Payments
On each interest payment date, the amount of each interest payment
will equal (i) the stated principal amount of the notes
multiplied by the interest rate, multiplied by (ii)
(180/360). If we call the notes for mandatory redemption on a
redemption date that is not also an interest payment date, the
amount of interest included in the payment you receive upon
redemption will equal (i) the stated principal amount of the notes
multiplied by the interest rate, multiplied by (ii)
(90/360).
Hypothetical Examples
The following examples
illustrate how the payments on the notes will be calculated with
respect to various hypothetical interest payment dates and
redemption dates, depending on whether we exercise our right in our
sole discretion to redeem the notes on a redemption date or, if we
do not redeem the notes prior to the maturity date, whether the
interest payment date is the maturity date. The hypothetical
payments in the following examples are for illustrative purposes
only, do not illustrate all possible payments on the notes and may
not correspond to the actual payment for any interest payment date
applicable to a holder of the notes. The numbers appearing in the
following examples have been rounded for ease of
analysis.
Example 1: The interest
payment date is not a redemption date, or it is a redemption date
but we choose not to exercise our right to redeem the notes on that
date.
In this example, we would pay
you an interest payment on the interest payment date per note
calculated as follows:
($1,000 × 5.35%) × (180/360)
= $26.75
Because the notes are not
redeemed on the interest payment date, the notes would remain
outstanding and would continue to accrue interest.
Example 2: We elect to
exercise our right to redeem the notes on the second redemption
date, which is not an interest payment date.
In this example, we would pay
you on the second redemption date the stated principal amount of
the notes plus an interest payment per note calculated as
follows:
($1,000 × 5.35%) × (90/360) =
$13.375
Therefore, you would receive
a total of $1,013.375 per note (the stated principal amount
plus $13.375 of interest) on the second redemption
date. Because the notes are redeemed on the second
redemption date, you would not receive any further payments from
us.
Example 3: The notes are
not redeemed prior to the maturity date and the interest
payment date is the maturity date.
In this example, we would pay
you on the maturity date, the stated principal amount of the notes
plus an interest payment per note calculated as
follows:
($1,000 × 5.35%) × (180/360)
= $26.75
Citigroup Global Markets Holdings Inc. |
|
Therefore, you would receive
a total of $1,026.75 per note (the stated principal amount
plus $26.75 of interest) on the maturity date, and you will
not receive any further payments from
us.
Because we have the right
to redeem the notes prior to the maturity date, there is no
assurance that the notes will remain outstanding until the maturity
date. You should expect the notes to remain outstanding
after the first redemption date only if the interest rate payable
on the notes is unfavorable to you as compared to other market
rates on comparable investments at that time.
Certain Selling Restrictions
Prohibition of Sales to EEA Retail Investors
The notes may not be offered, sold or otherwise made available to
any retail investor in the European Economic Area. For
the purposes of this provision:
|
a) |
the expression “retail investor”
means a person who is one (or more) of the following: |
|
(i) |
a retail client as defined in
point (11) of Article 4(1) of Directive 2014/65/EU (as amended,
“MiFID II”); or |
|
(ii) |
a customer within the meaning of
Directive 2002/92/EC, where that customer would not qualify as a
professional client as defined in point (10) of Article 4(1) of
MiFID II; or |
|
(iii) |
not a qualified investor as
defined in Directive 2003/71/EC; and |
|
b) |
the expression “offer” includes
the communication in any form and by any means of sufficient
information on the terms of the offer and the notes offered so as
to enable an investor to decide to purchase or subscribe the
notes. |
Additional Information
We reserve the right to withdraw, cancel or modify any offering of
the notes and to reject orders in whole or in part prior to their
issuance.
© 2022 Citigroup Global Markets Inc. All rights reserved. Citi and
Citi and Arc Design are trademarks and service marks of Citigroup
Inc. or its affiliates and are used and registered throughout the
world.
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