Hedge Fund Manager Paulson loads up on Citigroup (C) and sells Goldman Sachs (GS)

       John Paulson, who ranked second in fund-manager earnings last year, according to Institutional Investor’s Alpha Magazine, disclosed that his hedge-fund group acquired 300 million shares of Citigroup Inc. (C) during the third quarter, while selling its entire stake of Goldman Sachs Group Inc.  The Citigroup holding, listed by New York-based Paulson & Co. yesterday in a regulatory filing, marks his second billion- dollar-plus investment in a bank that received government bailout funds during the credit crunch. Paulson’s group bought 168 million shares of Charlotte, North Carolina-based Bank of America Corp. in the second quarter.
       Paulson, who earned some $2 billion last year in part by betting that the housing market would collapse, has invested in bank stocks that plunged during the 2008 financial crisis. He sold shares during the third quarter in Goldman Sachs (GS) and JPMorgan Chase & Co. (JPM), while building a stake in a bank that remains partly owned partly owned by the government.  Paulson . His Credit Opportunities Fund soared almost six fold in 2007 through wagers that sub prime mortgages would sour. He started the Paulson Recovery Fund in 2008 to invest in financial firms hurt by mortgage write downs.  Citigroup shares now trade at $4.05 each, quadruple the low of 97 cents that they hit in early March, yet below the peak of about $57 in December 2006. The number of common shares outstanding quadrupled to 22.9 billion in September through a preferred stock conversion that gave the U.S. Treasury Department a 34 percent stake in the company.
      Paulson sold 2 million Goldman Sachs shares that he had acquired during the second quarter and cut his stake in JPMorgan to 2 million shares as of Sept. 30 from 7 million at June 30. He bought 2.75 million shares of Hartford Financial Services Group Inc. and more than doubled his holdings in First Horizon National Corp. to 7.1 million shares from 3 million.