JPMorgan Chase & Co. bought a $3.5 billion portfolio of real estate loans from Citibank, the company said Tuesday.

JPMorgan said the portfolio includes about 3,800 loans, most of which are multifamily real estate loans for properties in New York, California, and Illinois. It said the portfolio is made up entirely of performing loans that have strong credit performance.

The deal will reduce assets by $3.5 billion at Citi Holdings, Citigroup's portfolio of noncore operating businesses and assets.

Citigroup said it is continuing to reduce the assets of Citi Holdings steadily. Citi Holdings makes up less than a quarter of the company's balance sheet, and Citigroup said it is reducing those noncore holding while working toward profitability and growth for Citicorp.

In afternoon trading, JPMorgan shares fell 54 cents to $39.28. Shares of Citigroup Inc. declined 6 cents to $4.02.