July 25, 2012 |
The crowd that wants to break up the biggest banks in the wake of the financial crisis has a new member - a former big banker. Sanford "Sandy" Weill, who helped build Citigroup Inc. into one of the nation's largest financial institutions, shocked many people Wednesday when he said that investment banking should be separated from traditional banking. "I think what we should probably do is go and split up investment banking from banking. Have banks be deposit takers. Have banks make commercial loans and real estate loans.
June 29, 2012 |
Former Citigroup Inc. Vice President Gary Foster was sentenced to 97 months in prison for embezzling almost $23 million from the bank, according to federal prosecutors in Brooklyn, New York. Foster pleaded guilty to bank fraud in September, admitting that he transferred money from various Citigroup accounts to his own at JPMorgan Chase & Co. He concealed his activities by making false accounting entries, according to the government. He used the money to buy real estate and luxury sports cars, including a Ferrari and a Maserati, prosecutors said.
June 22, 2012 |
Moody's Investors Service slashed the credit ratings of more than a dozen giant global banks amid worries that Europe's economic turmoil could slow both profit and growth. The downgrades, announced after the close of U.S. financial markets Thursday, included Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley, Citigroup Inc. and Bank of America Corp. The move came as the 15 banks singled out by Moody's try to navigate through the European debt crisis, which could have a major effect on their trading businesses.
May 3, 2012 |
Wells Fargo & Co. has become so dominant in the mortgage business that major investors and federal regulators are worried that a financial hiccup at the giant bank could roil the already beleaguered real estate market. Wells originates 34% of all home loans - more than the combined total of the next seven biggest mortgage lenders. That's why regulators are closely watching the San Francisco bank, Paul J. Miller, a former Federal Reserve bank examiner, said Thursday. "The problem is there's a lot of systemic risk when one company has that much of the market," said Miller, an analyst specializing in mortgages at FBR Capital Markets & Co. Wells Fargo's balance sheet is viewed by analysts as being among the strongest of the nation's banks, and a major distress in its mortgage business is seen as unlikely.
April 18, 2012 |
The shareholder rejection of Citigroup Inc. Chief Executive Vikram Pandit's $15-million pay package has some on Wall Street wondering if the same fate might be in store for the heads of other big U.S. banks. Both Wells Fargo & Co. and Bank of America Corp. will ask shareholders in the coming weeks to vote on a "say on pay" proposal. Corporate governance experts and activist shareholders expect that these votes will capture even more attention now that Citi's shareholders have said they want Pandit's compensation to be dialed back.
March 14, 2012 |
More than three years after getting lifesaving injections of federal cash, the nation's major banks are generally healthy enough to withstand another economic shock. That's the assessment from the latest round of stress tests on the 19 biggest banks by the Federal Reserve. But there are still some signs the industry hasn't fully healed from Wall Street's huge meltdown. Four banking firms, including giant Citigroup Inc., failed one or more tests on whether they would survive a worst-case scenario.
February 15, 2012 |
Citigroup Inc. is paying $158 million to settle accusations that it took advantage of a federal mortgage insurance program. In a settlement with the Justice Department, Citi admitted that it provided misleading information about the quality of its mortgages to a federal insurance program run by the Department of Housing and Urban Development. The government provided backing for the mortgages and ended up losing millions when the borrowers defaulted. In the complaint filed Wednesday as part of the settlement, the U.S. attorney's office in Manhattan said CitiMortgage violated the rules of the Federal Housing Administration insurance program for six years until it was subpoenaed in July.
January 18, 2012 |
Wells Fargo & Co. reported fourth-quarter profit rose 20%, fueled by strong returns from the San Francisco bank's mortgage business. The bank said robust loan growth from consumers and businesses helped it top Wall Street projections. Profit rose to $4.1 billion, or 73 cents a share, on $20.6 billion of revenue. The results demonstrate that Wells Fargo is able to grow its loan portfolio and overall revenue despite the sluggish economy and continued global financial turmoil.
December 15, 2011 |
The Securities and Exchange Commission is appealing a judge's rejection of the regulator's $285-million civil securities fraud settlement with Citigroup Inc., according to court papers filed Thursday. The pact was rejected by U.S. District Judge Jed Rakoff last month as "pocket change" for Citigroup. In that ruling, the judge criticized the SEC's policy of settling lawsuits without having defendants admit or deny wrongdoing. The SEC said in a statement that it believes Rakoff erred "by announcing a new and unprecedented standard that inadvertently harms investors by depriving them of substantial, certain and immediate benefits.
December 6, 2011 |
Citigroup Inc. Chief Executive Vikram Pandit said the bank would cut about 4,500 jobs in coming quarters as he seeks to trim costs amid slumping revenue. Citigroup will take a charge of about $400 million in the fourth quarter tied to the reductions, including severance, Pandit said Tuesday during an investor conference in New York. Citigroup, the third-biggest U.S. lender by assets, employed about 267,000 people at the end of the third quarter. The bank said in September that it would limit hiring only to crucial jobs in an effort to control costs and boost revenue as regulations on minimum capital levels take effect.