The investment in the former has made Paulson and Co over $1 billion since mid-2009 and the latter is on the up and up.

Citigroup was the fund’s most profitable bank holding last year, Paulson said in a letter to clients this month. “Citigroup demonstrates the upside potential of many of the restructuring investments we have added to our portfolio and our ability to generate above-average returns in large positions,” Paulson said in the letter. Paulson sold 82.7 million shares in New York-based Citigroup in the third quarter, leaving it with 424 million shares, according to filings. The bank was Paulson’s fourth- largest U.S. equity holding in the period.Paulson, which manages $35.9 billion, said it expects to see continued U.S. economic growth this year.

“We believe the U.S. economy is recovering and we anticipate continued growth,” the firm said in the letter.

Paulson Made More Than $1 Billion On Citigroup Stake [Bloomberg]