Sovereign wealth funds are not likely to try to take more control over Citigroup in exchange for their investment, but they have the right to meet with the bank's executives and be informed of its progress, Chairman Sir Win Bischoff told CNBC Europe.
Bischoff also ruled out any intention of buying a major bank such as Lehman Brothers or UBS.
Citigroup , which this week announced it would close down two subprime units in the UK at the cost of over 600 jobs, will focus on universal banking, he added.
Hit hard by the financial meltdown following the subprime crisis, Citigroup has raised $42.5 billion in capital so far to strengthen its balance sheet, of which $18.5 billion came from sovereign wealth funds.
"They do not wish to have people on the board, because having people on the board constrains what you can do," Bischoff told CNBC Europe's Simon Hobbs. "I'd be very surprised if they asked for more, because politically they are very astute."
But the representatives of the sovereign wealth funds have the right to meet with Citigroupexecutives and inquire about the bank, he added.
The subprime crisis was "a catalyst for an enormous amount of liquidity in the system," Bischoff said, warning that more regulation also poses risks.
At a recent G7 meeting, government representatives discussed ways to introduce regulation so that the excesses which led to the credit crunch will not be repeated.
The meeting indicated that authorities would like to have some ways of tightening up regulation, but most officials were aware that the financial industry "did a lot" for economic growth rates, Bischoff said.
"You have to balance on one hand the desire for not having accidents like this happen as against what this does in terms of innovation and so on," he added.