Citi not to seek Fed approval to boost capital return in 2012
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Citi not to seek Fed approval to boost capital return in 2012

Last Updated: Saturday, June 09, 2012, 16:28
 
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Citi not to seek Fed approval to boost capital return in 2012
New York: Citigroup Inc, which is scheduled to re-submit its capital plan on Monday, will not seek permission of Federal Reserve to boost payouts for its shareholders this year.

"We have decided not to request any additional return of capital in the 2012 re-submission. We will make decisions regarding the 2013 capital plan later this year," Citigroup said in a statement.

In the meantime, the bank will continue to build additional capital through earnings and the ongoing reduction of non-core assets, the statement said.

"Citi has sold more than 60 businesses that were non-core," it added.

Citigroup CEO Vikram Pandit earlier this year had promised a higher dividend to its shareholders. The bank currently pays a token amount of 1 cent per share every quarter.

In March this year, Fed had rejected Citigroup's capital plan saying that it didn't have enough capital to raise its stock dividend and also be prepared to withstand another financial crisis.

"Citi is one of the best capitalised banks in the world," Citigroup said.

The statement further noted that "with greatly improved financial strength, a highly liquid balance sheet, and our strategy showing results, Citi will continue to build its capital levels for the benefit of our shareholders."

Meanwhile, Citi also announced the redemption of two series of Citi trust preferred securities, which would result in a likely reduction of around USD 4.9 billion in Citigroup's Tier 1 Capital.

PTI



First Published: Saturday, June 09, 2012, 16:28


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