Until this morning, Citigroup was the last holdout among 11 banks sued in the bankruptcy of Enron.

Claims from Enron creditors totaling about $21 billion were headed to a trial set to begin April 28, and a hearing on Citigroup's motion to dismiss the case was scheduled for Thursday in Federal Bankruptcy Court in Manhattan.

Citi has now agreed to pay $1.66 billion to Enron to settle the claims. In a statement, Citi said it agreed to the settlements "solely to eliminate the uncertainties, burden, and expense of further protracted litigation," and noted that the settlement is covered by Citi's existing litigation reserves. Citi also agreed to waive $249.4 million in claims against Enron. For its part, Enron will allow $2.4 billion in credit-linked notes, known as the Yosemite claims, to go forward.

The other banks had earlier agreed to a settlement of what is known as the megaclaims litigation, for a total of $1.76 billion.

But the claim against Citi was always the largest, and the bank's lawyers from Paul, Weiss, Rifkind, Wharton & Garrison, have fought the claims at every juncture, most recently pressing for a change of venue for the trial.

However Citigroup has much bigger problems than the litigation and ample reason to try to put the Enron episode behind it. Under its new chief executive, Vikram Pandit, Citi is trying to dig out from billions of dollars of losses on investments tied to subprime mortgages.

And last week, the Wall Street Journal reported that Steven Digilio, a former Citi vice president, had filed an affidavit in the case, seeking to come forward to testify in the trial without violating his severance agreement with the bank. His affidavit states he sent an email "questioning the appropriateness of continuing to do business with Enron" and saw a handwritten note on an article about Enron and Citi "that may have had the word ‘fraud' in it." The affidavit did not attach the email or article.

Enron representatives say the report of the affidavit "helped" move the settlement talks along.

In January, Citi's brief to throw out the claims called the lawsuit by the Enron creditors "a shameless effort to evade responsibility," because Enron, a company run by "felons and self-confessed fraudsters," had only itself to blame for its collapse.

In fighting the Enron shareholder class action, Citi was not nearly as aggressive: It paid $2 billion in June 2005 to settle securities-fraud allegations, while Merrill Lynch, Credit Suisse, and Barclays fought claims that the banks should be held accountable for their role in Enron's 2001 collapse. Those banks won an appeal at the U.S. Court of Appeals for the Fifth Circuit, and that win was sealed when the Supreme Court issued a ruling in January declaring that there could be no "scheme" liability under the federal securities laws. After ruling in Stoneridge, the justices declined to hear the Enron shareholders' petition. The class-action claims against Merrill and the other banks has since been remanded to Judge Melinda Harmon of the Federal District Court in Houston.