[ForexNews]

At least 6 of the 19 largest US banks require additional capital, according to preliminary results of government stress tests, people briefed on the matter said, reports Bloomberg. While some of the lenders may need extra cash injections from the government, most of the capital is likely to come from converting preferred shares to common equity, the people said.

On a related note, Citigroup has reportedly told US regulators it could fill the capital shortfall identified in the stress test by selling large businesses, asking more investors to convert their preferred shares into common stock and reducing its balance sheet, the FT reports. Executives are trying to persuade the government Citi does not need more capital beyond its recent plans to bolster its balance sheet and cut costs, the paper notes.