Citigroup (C) shares slide on resolution plan shortcomings

November 23, 2022 1:18 PM EST

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Citigroup (NYSE: C) shares dipped Wednesday after agencies identified a shortcoming in its resolution plan.

The bank's shares are down more than 2%, trading around the $48.22 mark at the time of writing.

The Federal Reserve Board and Federal Deposit Insurance Corporation announced the results of their joint review of the resolution plans that the eight most prominent and most complex domestic banking organizations submitted in 2021.

The plans have to describe the strategy for "rapid and orderly resolution in bankruptcy" in the event of significant financial distress or the bank's failure.

However, while seven of the financial institutions' plans were in order, the agencies identified a shortcoming in Citigroup's plan.

"In Citigroup's resolution plan, the agencies found a shortcoming related to data quality and data management concerns previously identified by the Board in its October 2020 enforcement action," the Federal Reserve Board and Federal Deposit Insurance Corporation said.

Following the announcement, Citi said it was pleased to have "addressed the shortcoming identified in the 2019 Resolution Plan," and it is "completely committed" to handling the shortcoming identified in its July 2021 plan.

"We are making significant investments in our data integrity and data management, as the letter notes. We will leverage that work to remediate the shortcoming identified today, as we acknowledge there is much more work to do," they added.

By Sam Boughedda

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