In the first of four quarterly reports, Citigroup said the money it received from the U.S. Treasury’s Troubled Asset Relief Program (TARP) will not fund advertising, marketing, lobbying, compensation and bonuses. Nor will it used to pay the company’s dividend.

Citigroup also said it created a special committee that will approve and track how the company uses TARP money.

As of the fourth quarter of 2008, the $36.5 billion has been approved for these initiatives:

• $25.7 billion for U.S. residential mortgages
• $5.8 billion for credit card lending
• $2.5 for personal and business loans
• $1.5 billion for commercial loan securitization
• $1 billion in originating student loans through the Federal Family Education Loan Program

Citigroup has three goals with TARP capital: To help expand available credit for consumers and businesses; restore liquidity and stability to the capital markets; and support the recovery of the U.S. economy.

“Americans from all walks of life are facing real economic hardship, and Citi must do whatever we can to help them. Our responsibility is to put TARP capital to work quickly, prudently, and transparently to support U.S. consumers, businesses and our communities during these challenging times,” Citi Chief Executive Officer Vikram Pandit said in the report.

Since receiving TARP money, many U.S. banks have been mum on their plans to spend it, spurring heavy criticism from government officials, investors and the media, including Money Morning’s investigative series on TARP transparency.

Money Morning’s ongoing investigation demonstrated that billions in U.S. bank rescue funds are financing buyouts worldwide – instead of lending at home. Some of those buyouts deals are being done in markets as far away as China. Meanwhile, credit remains tight here in the U.S. market, a situation that could be alleviated only if the banks made the bailout money available to consumers in the form of loans.

Citigroup’s report – and promise of another for each quarter – takes a lot of pressure off Pandit and the rest of the company’s board. And hopefully, it will put pressure on other TARP benefactors to prove they are putting it to good use.

In its latest investigative offering, The Associated Press contacted 21 banks that received at least $1 billion in government money and asked four questions: How much has been spent? What was it spent on? How much is being held in savings? And what’s the plan for the rest?
According to The AP, none of the banks provided specific answers. Some banks actually admitted that they simply didn’t know where the money was going.

Source: Citigroup Lifts Curtain on $36.5 Billion in TARP Money; Will Other Banks Follow?