Citigroup's Regulatory Overhaul: Inside the Struggle for Compliance

Citigroup has faced challenges in training employees for risk, compliance, and data roles, affecting its ability to resolve regulatory issues. Despite investing billions, the bank struggles with a skilled workforce shortage. CEO Jane Fraser's restructuring further complicated efforts to address these regulatory reprimands from the Federal Reserve and OCC.

Citigroup has encountered significant hurdles in equipping staff with the necessary skills for risk, compliance, and data roles. Although the bank has spent billions on revamping its regulatory processes, a lack of adequately trained personnel remains a significant issue.

In an effort detailed in an internal analysis seen by Reuters, Citigroup acknowledges its ongoing struggle with these challenges, which contribute to prolonged compliance issues. The bank, under two regulatory consent orders for the past four years, highlighted inadequate risk management skills among staff.

Further complicating its efforts, CEO Jane Fraser initiated a massive restructuring in September 2023, leading to layoffs that included some staff involved in regulatory compliance. Though Citigroup insists the layoffs didn't impede regulatory progress, the effectiveness of these efforts remains under scrutiny by regulators.

(With inputs from agencies.)