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With the sharp stock-market decline rapidly Citigroup to become a full-blown crisis of confidence, company executives on Friday entered into discussions with federal officials about how to stabilize the struggling financial giant.
While a series of meetings and telephone calls, the executives and officials weighed several options, including whether to replace the chief executive of Citigroup, Vikram S. teacher, or to sell all or part of the company.
Other options discussed included a public endorsement from the government or a new financial lifeline, people involved in the discussions said.
The course of action, however, remained unclear on Friday night, said these people, and other options can still occur. But after a year of losses yawning and accelerating a decline in shares prices, Citigroup, which has $ 2 trillion in assets and operations in scores of countries, is running out of time, analysts said.
After a board meeting early Friday morning, management of Citigroup and some board members held several calls with Henry M. Paulson Jr., Treasury secretary, and chairman of the Federal Reserve Bank of New York, Timothy F. Geithner, who later, he emerged as President-elect Barack Obama the choice to be Treasury secretary.

As Citigroup’s stock has sunk during the day, falling almost 68 cents to $ 3.87, Federal Reserve careful monitoring was how much money corporations and other clients were withdrawing from the bank, people involved in the discussions said .

The Fed was trying to determine whether the stock market tumult could escalate into something worse.

Until now, these people said, most clients and customers remained committed to Citigroup.

But the troubles Citigroup has opened a new chapter in the long-running financial crisis, government officials said that the Treasury Department was to ask if for the second half of the $ 700 billion rescue fund, approved by Congress in September.

It was unclear whether any money would be used to make a cash infusion into Citigroup, which received 25 billion $ from the government in October. A second financial rescue for banks could be politically difficult at a time when auto industry is being transformed by the struggle far from Washington.

As luck Citigroup declined on Friday to Mr. pedagogue, the company’s embattled chief executive, left the offensive. He worked the phones and kept a companywide call to shore up the confidence of anxious employees.

Later in the day, the company held a similar appeal with large corporate customers. Sunday, Citigroup plans to run full-page advertising in major newspapers confirmed that “our financial markets have been tested in ways unprecedented”, but argue that the company has a wide range of business and a management expertise to wins. In a nod to the company slogan, the text concludes: “That is why now, more than ever, you can feel confident that Citi never sleeps.”

However, Citigroup directors are not expected to sleep much this weekend as they continue to pursue plans, including what you might need them to calm anxious investors before the stock market opens on Monday morning.

In a maneuver that Mr. schoolteacher has championed for the Securities and Exchange Commission to reinstate the “uptick rule” which prevents short-sellers betting against the companies whose stock price is falling. Mr teacher has been lobbying S.E.C. for the last week, as other Wall Street bosses.

Mr teacher and others have suggested that Citigroup is a victim of short-sellers, which some have blamed for speeding the demise of other financial companies this year.

In September, Richard X. Bove, an analyst at Ladenburg Thalmann, predicted that short-sellers would turn their attention more and more financial companies including Citigroup, which said the time was sufficiently strong to resist pressure.

“They were going to hit a company that is too well established, very well capitalized, and I think it will be Citigroup,” he said. However, while Citigroup is widely regarded as too big and too interconnected to be allowed not to immediately its future is uncertain. Executives at other financial firms said that there are not many options left, and that Citigroup’s stock has reached a level of government, which may force action.

“The reason they will have to” Save “Citibank is you can not allow this hysteria,” said Peter J. Solomon, chairman of Peter J. Solomon Company, a small investment bank.

Investors and executives from other banks said in a kind of bank would be able to give itself some breathing room would be for Mr. schoolteacher, who became chief executive less than a year ago, to step down.

Executives from New York were also pointing out that Citigroup has a global presence. They suggested that perhaps a government should involve bailout money from other countries in addition to the United States.

“If there is flight from Citi’s stock, which is unfortunate, but I do not believe that government business,” said David M. Walker, president of the Foundation Peter G. Peterson and a comptroller general was the United States.

Mr Walker said that the government should be concerned only if Citigroup were run on the bank threatened the financial system. Government should not, he said, are concerned about the shareholders.

Some executives, however, argued that it was important to protect Citigroup shareholders, because if they lose their investment, which will send other banking stocks diving.

Among other ideas being bandied about Washington and the halls Citigroup would be a merger between Citigroup and assisted by another big bank. The merger could be structured with government assistance based on Re, which was developed to Citigroup and Wachovia merger.

This is not a deal eventually, because it goes through Wells Fargo stepped in with a higher bid, but it would have involved the Federal Deposit Insurance Corporation sharing the losses at $ Wachovia of 312 billion loan with Citigroup. Citigroup would be absorbed by the first 42 billion $ in losses, and the government would have absorbed the rest. For F.D.I.C. would be given 12 billion to $ mandate and preferred shares of Citigroup in return.

This structure could be used in a merger, but this time around, the government would have absorbed losses on loans to Citigroup. But it remains unclear what other bank is in a position strong enough to merge with Citigroup.

Inside Citigroup, Friday, upset some senior executives said that the government had “allowed” Wells Fargo Wachovia to take from them, people from the company said. They claimed that Citigroup and Wachovia were allowed to merge “we would not be in this position,” one executive said.

Another option could be for the government to buy a large chunk of Citigroup’s assets in a swoop. Such action could be structured similarly to a proposed deal for UBS in Switzerland. A UBS spokesman, Mark Arena, said Friday that the agreement would allow UBS to have “one of the cleanest balance sheets of our colleagues.”

At the time of the deal’s announcement in October, Jean-Pierre Roth, president of the Swiss National Bank, said the government had no time to wait for the value of assets to improve. “UBS does not have time,” said Mr. Roth.