The US government agreed to become the biggest single shareholder in Citigroup on Friday, in the latest attempt to save the ailing financial group and to shore up the country’s banking system.

The partial nationalisation will give the government a stake of up to 36 per cent in the troubled lender, capping a spectacular fall from grace for what was one of the world’s largest financial institutions. At Friday’s share price, the market value of Citi – which has some $1,600bn in assets and operations in 130 countries – was less than $9bn.