Market Chatter: Citigroup Notices Requiring Risk-Control Fixes Terminated by US Fed

BY MT Newswires | ECONOMIC | 12/18/25 03:17 PM EST

03:17 PM EST, 12/18/2025 (MT Newswires) -- The US Federal Reserve has closed formal notices issued to Citigroup (C) that required the bank to enhance trading risk controls, Reuters reported, citing people familiar with the matter.

The notices, issued in late 2023, addressed three matters requiring immediate attention.

The notices included how the bank calculates and manages trading partner risks and sets aside capital to cover potential losses on those trades, how it uses proxies when data is unavailable, and governance over responsibilities across legal entities, according to the news outlet Wednesday.

Citi declined to comment when contacted by MT Newswires.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

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