Let's talk banking this week.

Sure, the financial services sector has been slammed hard in recent months. Weaker banks have gone under. Stronger banks can be had for substantially less than what they were fetching a year ago. A contrarian would be all over this.

I'm somewhat of a contrarian, but I'm not all over this. Every week I recommend a stock that investors should consider dumping from their portfolios, while nominating three stocks to take its place.

Who gets tossed out this week? Come on down, Citigroup (NYSE:C).

Not a Fool for the Citi
With shares of Citigroup trading at a third of its 52-week high, this would normally seem like a great time to look into the banking giant. But the fact that it almost stole Wachovia's (NYSE:WB) banking operations before Wells Fargo (NYSE:WFC) rained on that parade is both a blessing and a curse.

Yes, Citi is one of the few companies with the financial backbone to make the most of the bargains in smaller banks that are being practically given away. However, the company's crybaby reaction to being outbid is making it the poster child of Wall Street greed. Is it too late to book the pity party at the St. Regis in Monarch Beach?

The Wachovia fumble isn't the only reason why I'm weary of Citigroup. Does anyone remember its $18.1 billion in write-offs in January? The trouble didn't end there. What about Citi's move to slash its dividend, before that sort of thing became cool? So much for that 27% compound average annual growth rate for its payouts over the previous 10 years. Citi's restructuring issues were enough to have it tapped by Tom Hutchinson for his Worst Bank Stock award back in June. Ouch!

Citi may be close to the bottom, but I feel that there are better bounce-back plays in the sector.

Good news
As I have every week, I don't talk down a stock unless I have three alternatives that I believe will outperform the company getting the heave-ho. Let's go over the three fill-ins.

National City (NYSE:NCC)
Hear me out. I realize that National City is in much dire shape than Citi. However, now that WaMu has been handed off to JPMorgan Chase (NYSE:JPM) and Wachovia is in the process of a pitchout, National City becomes the next worthwhile buyout candidate. The global markets are doing everything they can to support the banking sector, so National City will either fetch a healthy buyout ransom or be able to pull itself out of its mess. If you think that Citi investors have had it rough with their stock trading at a third of its 52-week high, National City is fetching just a tenth of its 52-week peak. This is a speculative bet, but it's a high-beta wager on the sector's recovery.

Bank of America (NYSE:BAC)
I was oh-so-close to tapping Bank of America as this week's loser. Shares plunged 26% yesterday, after the company pre-announced disappointing quarterly results and a 50% dividend cut. Then things got worse last night, when it priced $10 billion in new stock at an even lower $22 a share. It was also an early nibbler, chomping down Countrywide before the buffet got cheap. However, the company is also in a better position now that its quarterly report is out of the bag and its coffers are $10 billion richer.

Yes, eBay. With this week's purchase of Bill Me Later, eBay now controls the two best brands in online transaction platforms. PayPal is the juggernaut, toppling even Citi's flawed c2it five years ago. Sure, I was so down on eBay back in June that it became one of the first companies I tossed in this "Throw This Stock Away" column. However, to my credit, the shares are now 40% cheaper. As payments, and micropayments, go online, eBay will lead the growth there.

Other headlines out of the weekly dumpster:

Do you like my substitutions? Would you rather stick it out with the tossed company? Are there other stocks I should look at in future editions of this column? Let me have it in the comment box below.

JPMorgan Chase and Bank of America are Motley Fool Income Investor picks. eBay is a Motley Fool Stock Advisor recommendation. Try any of our Foolish newsletter services free for 30 days.

Longtime Fool contributor Rick Munarriz wonders if we'll all have our accounts with the one and only bank by the time this is all over. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.