Ban lifted on Citi expansion plans
(6 April 2006 – USA) The Federal Reserve Bank of New York has lifted Citigroup’s year long ban from mergers, saying the bank had made significant progress in implementing a new compliance risk management program.
"Consequently, the understanding that you would refrain from significant expansion is no longer in operation," executive vice president of the NY Fed William Rutledge wrote.
However, Rutledge said any expansion proposals undertaken by Citigroup would be carefully reviewed.
The ban was imposed by the Fed when Citigroup was in the process of acquiring First American Bank SSB. The deal was approved by the Fed but the bank was told it had to tighten up internal controls in both its domestic market and overseas.
Last week in Australia, the Australian Securities and Investments Commission said it had begun action against Citigroup in the Australian Federal Court regarding alleged insider trading relating to Toll Holding’s bid for Patrick Corp.
However, Rutledge said any expansion proposals undertaken by Citigroup would be carefully reviewed.
The ban was imposed by the Fed when Citigroup was in the process of acquiring First American Bank SSB. The deal was approved by the Fed but the bank was told it had to tighten up internal controls in both its domestic market and overseas.
Last week in Australia, the Australian Securities and Investments Commission said it had begun action against Citigroup in the Australian Federal Court regarding alleged insider trading relating to Toll Holding’s bid for Patrick Corp.
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