New Issue: Citigroup adjusts call premiums for $1.08 million Pacers on homebuilder, gas funds

By Marisa Wong

Madison, Wis., Sept. 16 - Citigroup Funding Inc. adjusted the call price of its $1.08 million 0% Premium Mandatorily Callable Equity-Linked Securities due Sept. 17, 2012 linked to the worst performing of the SPDR S&P Homebuilders exchange-traded fund and the United States Natural Gas Fund, LP, according to an amended 424B2 filing with the Securities and Exchange Commission.

The notes will be called at par plus a premium if the worst-performing fund closes at or above its initial price on any of three call dates, which are March 12, June 12, 2012 and Sept. 12, 2012. The last call date is also the final valuation date. The call premium is 11.5% if the notes are called on the first call date, 17.25% if called on the second call date and 23% if called on the third date. The call premium was changed from 22.3% per year.

If the notes are not called, the payout at maturity will be par if the closing share price of each fund is greater than 60% of its initial share price throughout the life of the notes. Otherwise, the payout will be par plus the return of the worst-performing fund. This return will be negative, because if the return on the final valuation date had been positive or flat, the notes would have been called.

Citigroup Global Markets Inc. is the underwriter.

Issuer:	Citigroup Funding Inc.
Issue:	Premium Mandatorily Callable Equity-Linked Securities
Underlying funds:	SPDR S&P Homebuilders exchange-traded fund and the United States Natural Gas Fund, LP
Amount:	$1,075,000
Maturity:	Sept. 17, 2012
Coupon:	0%
Price:	Par
Payout at maturity:	Par if closing share price of each fund is greater than 60% of initial share price throughout life of notes; otherwise, par plus return of worst-performing fund, which will be negative
Call:	Automatically at par plus 11.5%, 17.25% or 23% if worst-performing fund closes at or above initial price on March 12, June 12, 2012 or Sept. 12, 2012, respectively
Initial share price:	$14.00 for homebuilders fund and $9.84 for natural gas fund
Pricing date:	Sept. 12
Settlement date:	Sept. 15
Underwriter:	Citigroup Global Markets Inc.
Fees:	2.5%
Cusip:	1730T0NT2

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