Citigroup reportedly is looking to raise additional foreign capital:

Citigroup is putting the final touches to its second big capital-raising effort in as many months, seeking up to $14bn from Chinese, Kuwaiti and public market investors.

Under the proposal being discussed, the bulk of the money roughly $9bn would be most likely to come from China, people familiar with the negotiations say. The Kuwait Investment Authority would contribute about $1bn, while $2bn to $4bn would be raised through a public placement of shares.

The article, from the Financial Times, notes that Citigroup’s attempt to shore up its finances by seeking of more offshore cash “underscores the depth of the problems faced by banks that suffered heavy losses in the US subprime mortgage crisis,” and adds,

As more US financial institutions raise capital from foreign sources, largely from sovereign wealth funds, there is a growing debate about the potential domestic political reaction, particularly during a presidential election year.

Interestingly, the presidential candidates have been rather quiet about this aspect of the mortgage crisis. Perhaps that’s because Citigroup is a top contributor to the presidential campaigns of Sen. Hillary Clinton, Sen. Barack Obama, John Edwards, Mitt Romney, Rudy Giuliani, Sen. John McCain and Fred Thompson.

The Financial Times story explains why Citigroup, which already went through one round of raising foreign capital, is able to do so again:

The second round is going very well, because Citi is seen as US Inc,” says the regional head of a US investment bank in the Middle East.

Indeed.