LONDON, Dec 9 (Reuters) - Citadel Securities, one of the world's largest market-makers, has become a top 10 bank participating in German government bond auctions this year, as it seeks to expand its European bond business.

It was the 10th most active bank in Germany's Bund issues auction group of 33 banks who buy the bonds it sells at auctions, according to a release from Germany's finance agency on Monday.

Citadel Securities has moved up from 12th place during the first half of the year, according to the agency.

Dealer banks usually buy bonds at auctions then sell them onto other investors, helping build market liquidity.

Citadel Securities joined the German group in late 2024, in a move that highlighted how non-bank financial institutions are set to play a growing role in European bond markets.

Its ranking leaves it behind big U.S. banks such as JPMorgan JPN.N, Citi C.N and Morgan Stanley MS.N, which claimed the top spots, but is more active than banks such as Goldman Sachs GS.N and France's Societe Generale SOGN.PA.

Citadel's growing presence in the German market comes as it is set to start trading French government bonds in the secondary market next year. It has also already expanded its business to trade euro and sterling interest rate swaps.

Germany has almost 2 trillion euros of outstanding government debt, making it one of Europe's biggest bond markets. It will see a surge in its bond sales in the coming years to finance its plans for massive fiscal stimulus.

(Reporting by Yoruk Bahceli; editing by Dhara Ranasinghe)

((Yoruk.Bahceli@thomsonreuters.com; +44 78 334 837 17; Reuters Messaging: yoruk.bahceli@thomsonreuters.com))