We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Citigroup (C) Resolves LIBOR Manipulation Case, To Pay $130M
Read MoreHide Full Article
With an aim to move past the litigation issues, Citigroup Inc. (C - Free Report) agreed to resolve a private U.S. antitrust lawsuit that accused it of rigging London Interbank Offered Rate (LIBOR). The company will be paying $130 million to settle the case, without admitting any wrongdoing. This news was reported by Reuters.
In 2011, a group of 27 plaintiffs including cities of Philadelphia and Houston, the National Credit Union Administration Board, Regents of the University of California and Salix Capital Ltd. had accused 16 banks of artificially lowering borrowing costs to ramp up earnings and appear financially healthy. Other than Citigroup, the defendant banks include some big names like Barclays PLC (BCS - Free Report) , Bank of America Corp (BAC - Free Report) , UBS Group AG and HSBC Holdings plc (HSBC - Free Report) .
Decline in borrowing costs resulted in lower LIBOR, which adversely impacted individuals and institutions that invested in the bond market as well as pension funds, mutual funds, money market funds, bank loan funds and several derivative products whose rates are tied to LIBOR.
While initially dismissing the case in Mar 2013, the U.S. District Judge Naomi Reice Buchwald had allowed the plaintiffs to proceed with the same in Aug 2015, based on a “viable legal theory”. Following this, in Nov 2015, Barclays had agreed to pay $120 million to resolve the matter, pending court approval. (Read more: Barclays Agrees to Settle LIBOR Class Action for $120M)
Citigroup spokeswoman Danielle Romero-Apsilos said the company was pleased to settle the matter. The settlement still requires court approval.
Citigroup has been settling lawsuits and regulatory probes with a goal to focus on core operations. As a result, the bank’s financial performance was adversely impacted by higher legal charges.
Nonetheless, Citigroup seems to have resolved majority of litigation matters and now intends to strengthen its core business. With an improving rate scenario and rise in loan demand, the company has been able to improve profitability.
This is getting reflected in Citigroup’s improved share price performance, depicting investors’ optimism for future growth. Over the last six months, the company’s shares have rallied 20.6%, which significantly outperformed the industry’s gain of 5.7%.
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look. See the pot trades we're targeting>>"
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Citigroup (C) Resolves LIBOR Manipulation Case, To Pay $130M
With an aim to move past the litigation issues, Citigroup Inc. (C - Free Report) agreed to resolve a private U.S. antitrust lawsuit that accused it of rigging London Interbank Offered Rate (LIBOR). The company will be paying $130 million to settle the case, without admitting any wrongdoing. This news was reported by Reuters.
In 2011, a group of 27 plaintiffs including cities of Philadelphia and Houston, the National Credit Union Administration Board, Regents of the University of California and Salix Capital Ltd. had accused 16 banks of artificially lowering borrowing costs to ramp up earnings and appear financially healthy. Other than Citigroup, the defendant banks include some big names like Barclays PLC (BCS - Free Report) , Bank of America Corp (BAC - Free Report) , UBS Group AG and HSBC Holdings plc (HSBC - Free Report) .
Decline in borrowing costs resulted in lower LIBOR, which adversely impacted individuals and institutions that invested in the bond market as well as pension funds, mutual funds, money market funds, bank loan funds and several derivative products whose rates are tied to LIBOR.
While initially dismissing the case in Mar 2013, the U.S. District Judge Naomi Reice Buchwald had allowed the plaintiffs to proceed with the same in Aug 2015, based on a “viable legal theory”. Following this, in Nov 2015, Barclays had agreed to pay $120 million to resolve the matter, pending court approval. (Read more: Barclays Agrees to Settle LIBOR Class Action for $120M)
Citigroup spokeswoman Danielle Romero-Apsilos said the company was pleased to settle the matter. The settlement still requires court approval.
Citigroup has been settling lawsuits and regulatory probes with a goal to focus on core operations. As a result, the bank’s financial performance was adversely impacted by higher legal charges.
Nonetheless, Citigroup seems to have resolved majority of litigation matters and now intends to strengthen its core business. With an improving rate scenario and rise in loan demand, the company has been able to improve profitability.
This is getting reflected in Citigroup’s improved share price performance, depicting investors’ optimism for future growth. Over the last six months, the company’s shares have rallied 20.6%, which significantly outperformed the industry’s gain of 5.7%.
Currently, Citigroup carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
"Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look. See the pot trades we're targeting>>"