Citigroup readying fresh plan to address risk management issues: WSJ

Citigroup Inc. C, -0.01% is due to submit Thursday to federal regulators a new plan for addressing deficiencies in its risk management infrastructure, The Wall Street Journal reported Thursday. The plan includes company milestones the Federal Reserve Bank and the Office of the Comptroller of the Currency (OCC) can review to judge the bank’s progress, the newspaper reported. The move comes after regulators have reprimanded the bank for problems with the systems it has in place to prevent costly mistakes. A regulator response to the plan is not expected for several months. “We have taken decisive actions to simplify our firm and we will continue to act with urgency to modernize the bank for the digital age and strengthen our risk and control environment,” a Citigroup spokeswoman told the WSJ. The moves comes about two years after the bank was fined $400 million because of deficiencies in its risk-management systems to prevent problematic transactions, risky trades and other harmful activities. Fixing theses issues has been a priority of CEO Jane Fraser, who took over amid reprimands from regulators during the reign of ex-CEO Michael Corbat. In an internal memo, Fraser said the bank added 30,000 employees out of its 230,000 employees worldwide to fix the risk problems. Shares of Citigroup are down 19.8% in 2022 compared to a 17.2% drop by the S&P 500 SPX, -1.31%.