Citi is accused of making “repeated material untrue statements and non-disclosure of material information to investors” from Jan. 19, 2007, through Jan. 15, 2009, that caused Norges Bank, the central bank, to buy the securities at inflated prices.

The complaint, filed on Sept. 17 in United States District Court in Manhattan, contends:

When the market slowly learned the truth of Citi’s financial condition, Citi came close to insolvency, and Plaintiff lost a substantial amount of its investment.

Citi’s near-demise had its genesis in the Company’s increasing willingness to take on risks for the sake of profit, without regard for – and without disclosing – the magnitude of the downside exposure it faced if those risks materialized.

The complaint names 20 current and former Citigroup executives and directors, including the current chief executive, Vikram Pandit, and his predecessor, Charles Prince. Norges Bank says it is suing to recover its losses: $735 million on Citigroup common shares and “in excess of $100 million” on bonds and preferred shares.

“We believe the suit has no merit and will defend ourselves vigorously,” a Citigroup spokeswoman said in a statement.

Norges Bank is not just responsible for setting monetary policy in Norway. It also oversees the international investments of the Norwegian Government Pension Fund-Global, one of the largest sovereign wealth funds in the world. Enriched by Norway’s gains from oil and natural gas production, the fund has $443 billion in assets.

Early in the financial crisis, four small Norwegian towns near the Arctic Circle made headlines after they lost $64 million on collateralized debt obligations created by Citigroup and sold by a Norwegian brokerage firm.