PANDIT TO SURVIVE UNCLE SAM’S CITIGROUP PLAN

Uncle Sam’s plan to increase its stake in hobbled Citigroup could be rolled out as soon as today – but what’s not likely to roll as part of the deal is CEO Vikram Pandit’s head.

Sources told The Post that no one expects a shake-up in Citi’s executive suite to be a condition of the government raising its stake in the bank, and all efforts are being made to avoid even the slightest appearance the feds are nationalizing Citi.

The government is expected to increase its stake to as much as 40 percent from the current 8 percent – a move that may place even more pressure on the bank’s management to turn a profit and trim an operation widely regarded as bloated.

The stake increase will likely involve converting a portion of the $45 billion in preferred Citi shares that the government already owns into common stock in order to bolster the shaky bank’s balance sheet.

Within Citi’s headquarters at 399 Park Ave., the nationalization chatter has vexed some of the bank’s most senior execs, who maintain that market fear, not actual balance-sheet challenges, are fueling the discussions about the government taking on a bigger stake in the bank.

“[The market] wants a light-switch event,” said one insider. “These [cash infusions] are non-economic events but this is the reality of the world we live in.”

A deal with Citi comes as the Treasury Department begins its so-called “stress tests” of 19 banks with at least $100 billion in assets. Under the plan, banks that need fresh funds will get six months to raise them privately before they can tap federal coffers.

The fresh aid could be provided through the government’s purchase of preferred shares that are convertible into common shares at a 10 percent discount to their price before Feb. 9. The preferred shares would carry a 9 percent dividend.