Citigroup Inc.'s (NYSE: C) plan to expand in China has met a snag with the U.S. regulators after the Federal Reserve imposed a penalty on the bank related to its data management and risk controls, per a Bloomberg report.
The bank is currently awaiting a clearance letter from the U.S. Federal Reserve, which is required by Chinese authorities to verify Citigroup's regulatory standing. Without this letter, the bank cannot proceed with its plans to set up a standalone securities firm in China.
The difficulties arose when Citigroup was fined $136 million in July 2024 for failing to address its data management issues adequately. The regulators stated that Citigroup made "insufficient progress" in dealing with the issues identified in 2020, which required Citi to fix these issues in its enterprise-wide risk management, compliance risk management, data governance and internal controls.
These fines complicated C's ability to comply with China's licensing requirements, making its path to ...
