Citigroup said on Wednesday the sale to Sumitomo Mitsui (SMFG), Japan's third-largest bank, had a total cash value of $8.7 billion, including retained cash and debt payments.
Citigroup, the third-largest U.S. bank, said it will book an immaterial after-tax gain during the fourth quarter.
Citigroup said it would form an alliance with SMFG to gain access to its global corporate banking clients.
For SMFG, the purchase is a key defensive move because it prevents the bank's bigger rivals from getting stronger.
Citigroup was forced to sell off assets globally to raise cash after suffering more than $85 billion in credit losses. The bank has received $45 billion in U.S. bailout money.
(Reporting by Juan Lagorio; Editing by Gary Hill)