Citigroup has announced that the Office of the Comptroller of the Currency (OCC) has withdrawn a 2024 amendment to a 2020 consent order, marking a step forward in addressing its compliance issues. Citigroup, the third-largest bank in the United States, has been working to resolve longstanding operational and risk management deficiencies. Citigroup is a global financial services company providing a wide range of banking and investment services to individuals, corporations, and governments. Its primary activities include consumer banking, corporate and investment banking, and wealth management.
The original 2020 order, which remains in effect, mandates that Citigroup enhance its efforts to rectify these issues. According to a statement from the bank, their transformation is the number one priority, dedicating the necessary resources to modernise systems and fortify the risk and control environment. This action by the OCC indicates a recognition of the progress Citigroup has made in satisfying regulatory concerns.
Reuters reported the Federal Reserve closed three confidential notices requiring the bank to fix trading risk management weaknesses. The OCC’s decision to terminate the 2024 amendment, agreed upon one week ago, was documented on the agency’s website. This amendment had stipulated that Citigroup demonstrate adequate resource allocation to address its identified problems, with potential limitations on capital distribution through dividends and other means if not met.
The underlying 2020 order requires Citigroup to implement various operational changes to tackle data management problems and establish controls for managing ongoing risks. Citigroup was initially fined $400 million in 2020 for failing to address persistent operational issues, followed by an additional $136 million fine in 2024, alongside the now-withdrawn amendment. Citigroup declined to comment further than their statement, and the OCC did not respond to requests for comment.
