Citigroup is selling up to 4.9 per cent of itself to the Gulf Arab emirate of Abu Dhabi for $7.5 billion.
The capital injection will shore up Citi's balance sheet, which has been hurt by some $6.8 billion of writedowns and losses in the third quarter, and the potential for another $11 billion in the fourth quarter.
Family-ruled Abu Dhabi - whose citizens number no more than 400,000 - will be Citi's largest shareholder.
The Abu Dhabi Investment Authority will have no special rights of ownership or control over Citi and no role in the management or governance of the bank.
The investment group is buying mandatory convertible securities that can be converted into Citi stock in 2010 and 2011 at prices ranging from $31.83 to $37.24 per share.
The number of shares it receives will adjust based on Citi's share price, with a higher share price giving the investor fewer shares.
The investment is expected to close within the next few days, Citi said.