Warren Warns Citi Against Any Acquisition, Citing Compliance Failures
By CU Today Staff —
WASHINGTON— Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, is urging Citigroup to abandon any plans for a major acquisition, arguing the bank's size, compliance record and history of taxpayer support make it unfit to further expand through mergers.
The warning came in a letter Wednesday to Citi CEO Jane Fraser following reports the bank has explored whether the current regulatory environment could support a significant acquisition, Law360 reported.
Warren, ranking member of the Senate Banking, Housing and Urban Affairs Committee, said any major acquisition would likely run afoul of federal banking laws requiring regulators to weigh financial stability, managerial resources and public benefits before approving mergers. In her letter, Warren pointed to Citi's 2008 financial crisis bailout, the bank's mistaken $900-million Revlon payment in 2020, ongoing regulatory consent orders and past consumer enforcement actions, arguing the institution remains "too big to manage." She urged Citi to halt any expansion discussions and instead consider selling businesses to simplify its operations.
The letter follows a Bloomberg report in March that Citigroup executives believed the Trump administration's more merger-friendly approach could improve the chances of winning approval for a large acquisition. Citigroup, however, denied the report at the time, telling Reuters it was "baseless speculation" and that the bank remains focused on organic growth and completing its multiyear transformation rather than pursuing acquisitions.
Warren requested Citi respond to a series of questions by July 22 regarding any acquisition discussions and the bank's compliance efforts. The Massachusetts Democrat has previously called on regulators to impose growth restrictions on Citi, arguing its recurring operational and risk-management failures demonstrate it should be shrinking rather than expanding.
Originally reported by CU Today.