U.S. Bank Review by Regulators Cites Citigroup Deficiencies in Data Management

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A recently completed banking review by the Federal Deposit Insurance Corporation and Federal Reserve warned Citigroup that the bank needs to improve its financial data management. The review’s authors warned the bank that the current deficiencies in those processes could hinder its ability to generate accurate reports and properly execute resolution plans.

The finding was the result of regulators’ review of eight of the largest U.S. banks’ “living will” plans, which detail how those institutions could be efficiently unwound if they faced bankruptcy or other severe disruptions. That review process was just one of several key reforms implemented in the wake of the 2008 financial meltdown that contributed to the Great Recession.

Though there were eight major banks involved in the review, Citigroup was the only one that regulators cited as needing additional reform. Previous reviews had noted similar weaknesses for banks like Morgan Stanley and Wells Fargo, but those deficiencies had reportedly been addressed.

In a November 22 letter to Citigroup, regulators noted:

“Issues regarding the Covered Company’s data governance program could adversely affect the firm’s ability to produce timely and accurate data and, in particular, could degrade the timeliness and accuracy of key metrics that are integral to execution of the firm’s resolution strategy.”

In response, the bank committed to resolving any outstanding issues and said that it continues to make “significant investments” in its data management and integrity. “We will leverage that work to remediate the shortcoming identified today, as we acknowledge there is much more work to do.”

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