OCC Withdraws Amendment to Citigroup Consent Order

The OCC withdraws a proposed amendment to a Citigroup consent order, no longer requiring a detailed resource breakdown for resolving the 2020 order.

The Office of the Comptroller of the Currency (OCC) has withdrawn a proposed amendment to a consent order it previously issued against Citigroup. The withdrawn amendment would have required Citi to submit a granular breakdown of resources it is employing to resolve the underlying 2020 consent order, which was likely prompted by a notorious $900 million errant transfer. The regulator's reversal signals a shift in its enforcement approach, granting the bank more flexibility in how it demonstrates compliance and remedies its internal control deficiencies.

This regulatory reversal contrasts with the trend of increasing supervisory demands on global systemically important banks. The OCC's decision suggests the agency may be satisfied with Citi's progress or is adjusting its remediation oversight strategy. Withdrawing the burdensome reporting requirement is the critical deliverable for Citigroup's management. This matters because it reduces a significant compliance burden and operational distraction for the bank, allowing it to focus resources on fixing core problems rather than exhaustive reporting, while also raising questions about the consistency of regulatory supervision.

For Citi executives, banking lawyers, and compliance officers industry-wide, the implications are nuanced. This development necessitates a careful interpretation of the OCC's signals regarding acceptable corrective action plans. The forecast is for closer scrutiny of how other banks under OCC orders navigate their remediation efforts. Decision-makers must balance the relief of reduced reporting with the ongoing imperative to substantively address the OCC's original concerns over risk governance. The next imperative for Citigroup is to capitalize on this regulatory goodwill by accelerating genuine improvements to its operational risk frameworks, ensuring the underlying issues that triggered the $900 million error are fully resolved to prevent future regulatory sanctions.