Federal banking regulators fined Citigroup on Wednesday Inc.
$ 400 million and ordered the country’s third-largest bank to fix its risk-management systems, citing “significant ongoing deficiencies”.
In a concurrence agreed by the board of New York Bank, the Federal Reserve blamed Citigroup for falling short in “various areas of risk management and internal control”, including data management, regulatory reporting, and capital planning. The Comptroller’s Office of the Currency said the penalty was for the bank’s “long-term failure” to measure its risk and problems in the data system.
Citigroup has said it is taking steps to address the concerns of regulators. The expected regulatory rebuke for the retirement of chief executive Michael Corbett intensified the plan, the Journal previously reported. Mr Corbett said the expensive, multiyear overhaul was left in the hands of his successor, Jane Fraser.
“We are disappointed that we have fallen short of our regulators’ expectations, and we are committed to fully addressing the issues identified in the consent orders,” the bank said in a statement. “There are significant remedial projects underway in the city to strengthen our control, infrastructure and governance.”
Citigroup shares fell 1% to $ 44.30 after hour trading.
(more to come.)
Write David Benoit at [email protected]
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