Risk management

The middle of a housing market downturn is no time to experiment with untested underwriting tools.

On paper, the deal was a no-brainer: a $15 billion debt financing that would net banks hefty fees and kick off a year of mega-acquisitions even as central banks tightened the spigots on their pandemic support. Yet eight months after agreeing to finance the leveraged buyout of Citrix Systems, Wall Street is now staring at a very different picture.

Wall Street banks are poised to realize roughly $600 million of losses after offloading financing commitments for the buyout of Citrix Systems to investors Tuesday, the culmination of months of work to try and mitigate the damage from underwriting pledges made early in the year before a sharp repricing of risk assets.

Consumers and small business could eventually feel the impact of stepped-up regulatory scrutiny of bank-fintech partnerships.

"The SEC may not want to answer to Congress on its climate disclosure rule, but ultimately, the SEC will have to answer to the courts — which should make it nervous," the Senate Banking Committee's Pat Toomey warned the agency's chairman, Gary Gensler.

The appointment creates a "full-fledged office" within the Office of the Comptroller of the Currency devoted to national banks' climate-change exposures, acting Comptroller Michael Hsu says.

The European Central Bank is intensifying discussions with bank executives over their readiness for a potential surge in company defaults and a drying up of energy market liquidity amid a worsening standoff over Russian gas supplies.

Financial downturns hit lower-wealth communities first and cause them to suffer the longest.

Major foreign banks are just as important to the U.S. financial system as large domestic banks, and ought to be regulated as such.

Citigroup's markets operation had hundreds of blind spots, allowing for potentially abusive transactions to go unnoticed in almost 900,000 trades processed every day at the bank's Canary Wharf headquarters for more than two years.