Citigroup Inc (NYSE:C) has had a lawsuit, filed against it by South Koreas Woori Bank, revived by a US appeals court. The filing accuses Citigroup of deceiving Woori Bank into buying securities that Citigroup was betting against before the financial crisis. The original filing was done in 2012. Citigroup had initially countered the suit, stating that filing is late as per South Korean law. The bank should have filed the lawsuit immediately, but representatives of the bank had stated that they had not been made aware of the particular law in place.
Woori Bank had invested $25 million in Armitage ABS CDO Ltd in 2007. This resulted in the bank taking a huge blow, when the subprime mortgage crisis hit the US. Woori Bank has, since then, sued a number of banks in the US, trying to gain compensation for its losses. Citigroup has, however, settled some of its charges with the US Securities and Exchange Commission (SEC). These charges included the aforementioned Armitage CDO.
The company had been losing stock since the announcement. However, things seem to have stabilized after the company held the election of directors to its board, by shareholders. The shareholders showed their support for the current directors by re-electing them to their respective positions. The Citigroup CEO, Mike Corbat, stated that his company plans to continue repurchasing the stock, while it was still trading at its low. However, he said that they would not be hasty in selling assets to draw down capital.
The company had been given the green light, to buy back $7.8 billion worth of stock, in March by the Federal Reserve. The decision was made after the federal agency stress-tested the group’s capital plans. The decision came after the filing was amended and submitted a second time, after the first one was rejected.
Citigroup Inc (NYSE:C) closed at $53.02 after gaining 0.42% on April 28. The company has 3.03 billion shares being traded in the market, with a 52-week range of $46.08-$56.95.
