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Analysts on average expect the third-largest U.S. bank by assets to post a profit of 8 cents per share for the fourth quarter of 2010, according to Thomson Reuters I/B/E/S.

That would compare with a year-ago loss of 33 cents per share.

Citigroup has largely recovered from the losses that drove it into the government's arms during the financial crisis and has shed most of the resulting government ownership.

The U.S. Treasury finished selling off its common share stake in Citigroup in December. The Treasury said on Friday it would unwind its final investment in the bank by auctioning off remaining warrants.

Shares of Citigroup closed at $5.13 on Friday -- their highest point since August 2009. The bank's shares have surged 55 percent since the beginning of 2010, and gained additional momentum last month after the U.S. government sold the last of its stake.

The bank's fourth-quarter profit is expected to lag that of larger rival JPMorgan Chase & Co, which beat analyst expectations on Friday and boosted investor sentiment about the outlook for the banking industry.

JPMorgan "set the bar very high," said Michael Holland, who oversees $4 billion of assets as chairman of Holland & Co.

"I think Citi is probably going to do very well but ... (Chief Executive) Vikram Pandit has a tall order to fill here when it comes to doing the same thing," he added.

Citigroup, like other banks, has seen its losses from bad loans shrink over 2010. But its revenues faltered in the face of weak loan demand and a slump in trading volumes over the second half of the year.

JPMorgan Chase said on Friday that it was starting to overcome both conditions, giving bank investors hope that other banks could start to see an increase in loan demand and trading profit this year.

(Reporting by Maria Aspan; Editing by Muralikumar Anantharaman)

Euro zone finance ministers on Monday discussed boosting the effective lending capacity of the currency bloc's bailout fund, but they made no firm decision and Germany, the biggest euro zone economy, said there was no rush to take action now.

The euro was near $1.3278 as of 0205 GMT, after having slid to a low of around $1.3243 overnight, well off a one-month high near $1.3460 set last Friday.

"The markets had gone a bit too far in expecting an increase in the rescue fund. German opposition (to the increase) seems quite strong and (German Chancellor Angela) Merkel may be reluctant to push it ahead of local elections," a trader at a Japanese bank said.

As worries over the euro zone's debt crisis linger, Greece's deputy prime minister said on Monday extending the repayment of the nation's debt could help the overborrowed country emerge from its debt crisis.

Stock market players wanted to see Wall Street's reaction to Apple's announcement, which knocked U.S. stock futures sharply lower on Monday when U.S. markets were closed for a holiday.

Japan's Nikkei average .N225 rose 0.2 percent 10,521.27, while the MSCI index of Asian shares outside Japan .MIAPJ0000PUS was little changed.

Tech shares outperformed, however, with the MSCI Asian IT index outside of Japan up nearly 1 percent.

Samsung (005930.KS), a rival to Apple in some business areas, jumped 2.7 percent, buoyed as well by regional gains in shares of memory chip makers after a newspaper report that Japan's Elpida planned to raise chip prices by about 10 percent.

Elpida (6665.T) rose 2.6 percent.

Investors were also closely watching the Shanghai Composite Index .SSEC after it slumped a day earlier on China's decision to raise lenders' reserve requirements late last week. The decline weighed on bourses across Asia which have drawn considerable support from China's robust economic growth.

The key Shanghai index fell 0.7 percent in early trade after sliding 3 percent on Monday, but Hong Kong's Hang Seng Index .HSI managed to avoid the downdraft and rose 0.4 percent on hopes for stronger corporate earnings.

U.S. crude futures stood little changed above $91 a barrel on Tuesday after falling the previous day when the dollar strengthened and a major Alaskan oil pipeline resumed full operations. Spot gold was steady at around $1,361 an ounce.

(Additional reporting by Ian Chua in Sydney and Antoni Slodkowski in Tokyo)

(Editing by Kim Coghill)

(Created by Yoko Nishikawa)

Goldman expects to raise $1.5 billion for Facebook, the wildly popular site used as a message board and for online social networking.

The chance to buy a slice of Facebook ahead of any future public listing attracted widespread commentary and news coverage, which potentially could bring it under regulatory scrutiny.

"In light of this intense media coverage, Goldman Sachs has decided to proceed only with the offer to investors outside the U.S.," the company said in a statement provided to Reuters.

Goldman began notifying clients of its decision on Sunday.

"We regret the consequences of this decision, but Goldman Sachs believes this is the most prudent path to take," the investment bank said in the statement on Monday.

Goldman said the decision not to conduct a private placement of the shares of Facebook, a closely held company, in the United States was solely its own and was not required or requested by any other party. That would include the U.S. Securities and Exchange Commission, which is scrutinizing secondary market trading in Facebook shares.

"Once this event received widespread publicity, it conceivably could be argued that Goldman was benefiting from a general solicitation, via news reports of its efforts on behalf of Facebook," former SEC Chairman Harvey Pitt said.

"My impression is that Goldman is using that as an excuse to save face, given the SEC investigation that has been publicized in the press, as a result of this proposed transaction," said Pitt, who is chief executive of consulting firm Kalorama Partners.

While general solicitation and advertising is still prohibited overseas, if the publicity has not been as widespread in other countries, the issuer and the underwriter could get comfortable proceeding with the offering, said an industry attorney who has advised companies with similar issues.

The Washington, D.C.-based attorney asked not to be identified because of the sensitivity of the issues surrounding private placements.

Goldman said it had originally planned to conduct a private placement in the United States and offshore.

Facebook already has received a $450 million investment from Goldman Sachs and $50 million from Russian investment firm Digital Sky Technologies, in a deal that valued the company at $50 billion.

SPECIAL FUND

Several weeks ago, Goldman approached its best private wealth clients with an offer to take part in a special fund that will own shares in the world's biggest social networking site. The deal would allow Goldman to offer clients a hot investment opportunity, while allowing Facebook to remain a private company.

Apple's shares traded in Frankfurt (AAPL.F) fell 7.5 percent by 1438 GMT, while futures for the S&P 500 and tech-heavy Nasdaq dropped 0.3 and 0.9 percent, respectively.

The U.S. markets are closed for a holiday on Monday and will resume trading on Tuesday.

During Jobs' leave of absence, Chief Operating Officer Tim Cook will be responsible for day to day operations. Jobs will continue as CEO and will be involved in major strategic decisions for the company.

He did not say for how long he would be on leave.

"Honestly, the effect on the company will probably not be that great in terms of fundamentals," said Richard Windsor, global technology specialist at Nomura.

"Perception of the company is another matter. Steve Jobs is seen by the market to be a major force in Apple's strategic direction. If his pancreatic cancer has returned, one could be quite worried."

Jobs underwent a liver transplant while on leave, returning to the company in late June.

(Reporting by Dominic Lau and Georgina Prodhan; Editing by David Holmes)