Risk

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.

The Federal Reserve looks to be paying closer attention to a potential pinch-point that rankled dollar funding markets almost three years ago and could at some stage become a catalyst for ending early officials' plans to shrink the U.S. central bank's expanded balance sheet.

Wells Fargo bungled the 2020 sale of Occidental Petroleum shares on behalf of an employee trust, leading to millions of dollars in losses when the bank failed to execute trades as planned before the COVID-19 pandemic tanked the stock market, a judge in Texas ruled.

The agency acknowledged that loan performance in the sector has been strong, but cited several reasons to think that might change, including rising interest rates, the effects of inflation and uncertainty about the future of work and commerce.

Fed Chairman Jerome Powell brushed off concerns that rapidly tightening monetary policy could disrupt the financial system. Some economists and policy experts beg to differ, raising concerns about loan defaults or even the collapse of a key institution or counterparty.

Citigroup is requiring some of its least-profitable trading clients to post more collateral and is even dropping some of them to help boost returns in its markets business.

The jury at an upcoming trial can draw an adverse inference about evidence destruction by the Chicago-based bank, a federal judge ruled. The plaintiff is seeking $1.9 billion from the bank, in addition to punitive damages and other funds in a bankruptcy-related case stemming from a Ponzi scheme.

Executives said the company may take a more conservative approach when it comes to adding new loans to its books in anticipation of an economic slowdown.

Vikram Pandit, who led Citi for five years, and Ash Gupta, who helped lead American Express for 41 years, have collaborated on a risk decisioning program meant to help make digital lending more efficient and cost-effective at banks of all sizes.

Just as advances in automobile technology have made driving safer, incorporating AI into decision-making reduces financial risks.

Klarna Bank, which advertises itself as a way to spread the cost of the latest brands and smartphones, is shelling out loans for milk and gas with cash-strapped customers looking for ways to cover basic necessities.

An alert released Tuesday asks banks to give special attention to specific “commodities of concern” as they monitor transactions.

The two megabanks said that their capital requirements will rise in the wake of Federal Reserve stress tests, putting downward pressure on their distributions to shareholders. Meanwhile, Bank of America, Wells Fargo, Goldman Sachs and others announced plans to raise their dividends.

A new and larger finance industry is emerging — one in which traditional institutions aren’t nearly as dominant as they used to be.

In its semiannual risk report, the Office of the Comptroller of the Currency said it was working to provide clarity on the legality and soundness related to digital assets.

Missed payments are rising among nonprime credits as higher prices on other goods leave consumers with less money to pay back their car and truck loans. The uptick may be a sign that the stellar credit environment for lenders is starting to turn.

Bank of Montreal hired Piyush Agrawal from Citigroup as chief risk officer to succeed Patrick Cronin, who’s stepping down later this year.

Citigroup may record losses of at least $50 million following a London staffer’s fat-finger trade that caused a flash crash in European stocks last month, according to people familiar with the matter.

The firms respectively settled the regulator’s allegations about suspicious activity reports and the duty of best execution — two major areas of emphasis.

People shouldn’t completely shun the crypto world after the recent collapse of a popular stablecoin, an official at the International Monetary Fund said Monday.