- Bank regulators want Citi to address weaknesses in its financial data management practices, according to a review of the living wills of the nation’s biggest banks.
- The Federal Reserve and the Federal Deposit Insurance Corp. (FDIC) found a shortcoming related to data quality and data management concerns previously identified in an October 2020 enforcement action against the bank, the regulators said Wednesday. That penalty presumably stemmed from an August 2020 human error that led Citi to mistakenly transmit $900 million to creditors on a 2016 Revlon loan.
- The regulators gave Citi until Jan. 31 to submit a “mapping document” addressing the issues. The bank is “completely committed to addressing the shortcoming,” it said in a statement Wednesday.
The Fed and Office of the Comptroller of the Currency (OCC) ordered Citi in October 2020 to improve its risk management, data and internal controls, and fined the bank $400 million, presumably in part because of the Revlon blunder.
But regulators are not convinced the bank’s living will adequately addresses the shortcomings that led to the error.
“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,” the Fed and FDIC wrote in a joint feedback letter to the bank.
Citi was the only bank among eight reviewed by the Fed and the FDIC to have a shortcoming in its resolution plan, the regulators said.
“As part of the Transformation Citi has embarked upon, we are making significant investments in our data integrity and data management,” the bank said in its Wednesday statement. “We will leverage that work to remediate the shortcoming identified today, as we acknowledge there is much more work to do. The result of these efforts will be more streamlined systems that improve the quality of our data as well as the speed with which it can be accessed.”