The US government's emergency rescue of Citigroup offers a new model for bank bail-outs: explicitly insuring against losses on toxic assets, with taxpayers footing the bill.

The Citigroup plan extends the federal commitment beyond the previous framework of capital injections from the Treasury and credit from the Federal Reserve.

Now, the US is a partner in the performance of $US306 billion ($500 billion) in real-estate loans and securities, sharing losses beyond $US29 billion on what are likely to be some of Citigroups worst holdings.

"Everybody and his brother has got to have their hand out now,'' said Eric Hovde, chief investment officer at Hovde Capital Advisors. "The whole problem is so much bigger and deeper than the Fed and Treasury ever understood.''

Taxpayers are likely to be at greater risk from the new template, which may be used to help more companies as debt writedowns continue to climb, analysts said.