(Reuters) – JPMorgan said issues with Citigroup Inc’s so-called living will, which details how the bank would be dissolved in bankruptcy, are manageable but could be a sticky issue for executives.
Citi was one of four banks determined by the Federal Reserve and the Federal Deposit Insurance Corp. to lack living wills because of deficiencies related to their derivatives portfolios.
“While this is expected to result in increased work for our lawyers, consultants and management, and an increase to our expense base, the impact will be manageable,” JPMorgan said.
“This adds to the growing list of issues that management needs to focus on,” the brokerage said, pointing to reports about the setbacks Citi is facing over the consent order and a recent lawsuit by a former managing director who claims he was fired for opposing attempts to provide false information to regulators.
The city called the lawsuit “meritless” and vowed to “vigorously defend itself.”
The bank has long battled concerns over its data management, and last week told investors it was automating processes and improving data reporting to meet regulators’ mandates.
Citi declined to comment and reiterated a statement from last week saying it was committed to addressing the issues identified by regulators.
(Reporting by Niket Nishant in Bengaluru; Editing by Shaunak Dasgupta)
