New York – The Federal Reserve Board (FRB) communicated that Citigroup Inc.'s (Citi) Stress Capital Buffer (SCB) requirement would increase from the currently effective requirement of 3.0% to 4.0% for the four-quarter window of 4Q 2022 to 3Q 2023. Accordingly, effective October 1, 2022, Citi is required to maintain an 11.5% effective minimum Common Equity Tier 1 (CET1) Capital ratio under the Standardized Approach, incorporating this SCB and its current Global Systemically Important Bank (GSIB) surcharge of 3.0%. Citi's effective minimum CET1 Capital ratio under the Advanced Approaches (using the fixed 2.5% Capital Conservation Buffer) will remain unchanged at 10%. Commencing January 1, 2023, Citi's GSIB surcharge will increase from 3.0% to 3.5%, which will be applicable to both the Standardized Approach and the Advanced Approaches, resulting in a minimum CET1 regulatory requirement of 12% under the Standardized Approach and 10.5% under the Advanced Approaches, both as of such date. As of March 31, 2022, Citi's CET1 Capital ratio was 11.4% under both the Standardized and Advanced Approaches.
Jane Fraser, Citi CEO, said: "These results again demonstrate that Citi has the capital to withstand a severe economic downturn. We have capacity to maintain the current common dividend of $0.51 per share in a range of stress scenarios, including the one outlined in the FRB stress test. The combination of our earnings generation, divestitures, optimization efforts and management buffer - which was designed in part to temporarily address volatility - will be important tools as we manage toward our CET1 target over the coming quarters. We are committed to executing the strategy we presented at Investor Day, improving our returns and delivering excess capital to our investors."
A Form 8-K Current Report regarding this announcement can be found here.
Citi, the leading global bank, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management.
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Certain statements in this release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. These statements are not guarantees of future results or occurrences. Actual results and capital and other financial condition may differ materially from those included in these statements due to a variety of factors, including, among others, the ongoing or forecasted impacts to Citigroup's results of operations and financial condition related to or resulting from Russia's military action in Ukraine, including the imposition of additional sanctions and export controls, as well as the broader impacts to financial markets and the global macroeconomic and geopolitical environments; higher inflation and its impacts; higher interest rates and the impacts on macroeconomic conditions, customer and client behavior, as well as Citi's funding costs; regulatory requirements; macroeconomic and other challenges and uncertainties related to the COVID-19 pandemic, such as the impacts to the U.S. and global economies; consummation of Citi's exits and wind-down, and the impact of any additional CTA or other losses; and the precautionary statements included in this release. These factors also consist of those contained in Citi's filings with the U.S. Securities and Exchange Commission, including without limitation the "Risk Factors" section of Citi's 2021 Form 10-K. Any forward-looking statements made by or on behalf of Citi speak only as to the date they are made, and Citi does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.
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