Citigroup expects to reduce about $400 billion in non-core assets over the next three years, as the largest U.S. bank seeks to boost efficiency and regain profitability.

Citigroup announced the planned cuts, which represent about 20 percent of its total assets, during a presentation to investors and analysts this morning at a conference in New York.

The New-York based bank has written down the value about $45 billion in assets during the past three quarters due to the housing and credit crises which have affected a large part of the financial services industry. The bank has also raised about $40 billion in capital from investors to keep its balance sheet in order.

The company said that it had nearly $500 billion in legacy assets as of the end of first quarter, with more than half of them performing less than expected. The company plans to reduce them to less than $100 million during the next two or three years.

Pandit told investors that the bank needs to get fit but that the changes would take time.

Since he rose to the chief executive position five months ago, Pandit has used some of that time to personally review many of the company's operations around the world. So far he has overseen the reduction of at least $65 billion in assets, according to Credit Suisse analyst Susan Roth Katzke.

Among the assets to be sold are structured investment vehicles, subprime collateralized debt obligations, real estate and leveraged commitments.

The company said its target is to eventually have its revenue grow by 9 percent per year, an annual net income of $20 billion as well as return on investment between 16 percent and 18 percent.

Shares of Citigroup rose 7 cents, or 0.29 percent to $24.37 in late morning trading on the New York Stock Exchange.