Shares of Citigroup rose in early trading on Monday after reports yesterday said the largest U.S. bank by assets was close to selling about $12 billion in leveraged loans and bonds to a group of private equity companies.

Shares of Citigroup were up 28 cents, or 1.18 percent to $24.04 at 11:11 a.m. in New York.

Prior to the credit crisis, banks took on debt from mortgage sales, and other transactions including corporate buyouts and repackaged them for investors. To reduce their risk exposure, they bundled the loans in to securities called collateralized debt obligations (CDOs).

However when the housing market bubble tumbled starting last summer, CDOs and other bonds backed by mortgages began to fall in value causing investors to lose their appetite for those and other risky securities. This left banks stuck with unwanted debt for several months.

The buyers for the current deal include Apollo Management, TPG and Blackstone Group, people briefed on the deal told the Wall Street Journal, which first reported the story.

The firms are expected to buy the loans and bonds at over a 90 percent discount. Citigroup is attempting to complete the deal before it releases quarterly results on April 18.

Citigroup spokesperson was not immediately available for comment.