Boston, MA 10/07/2013 (wallstreetpr) – How does one serve judgment on a bank, the third largest in the U.S, which has just received five global awards, yet is facing a $30 million penalty over violation of research contract? This is complex, but this is what defines Citigroup Inc (NYSE:C).
At the annual Investment Banking Award dinner in London, Citigroup received five global awards from Banker Magazine.
This is not a mean fete considering that a penal consisting 14 banking industry experts participated in deciding the awards recipient. The wards were based on and around industry aspects such as innovation, strategies and products comparing different players in investment banking.
For these global awards, now Citigroup is the: Most Innovative Investment Banking Team, Most Innovative Investment Bank for Equities and Initial Public Offerings, Most Innovative Investment Bank for Prime Brokerage, Most Innovative Investment Bank for Equity-linked Products and Most Innovative Investment Bank for Risk Management.
The Banker magazine is a reputed publication that has been in global financial intelligence reporting since 1926.
Now, that is as far as good news goes for the global bank holding, Citigroup. The recent stain to the bank’s reputation is the scandalous manner in which it handled a research obligation. For this reason, the bank is paying $30 million in settlement. Why this? It is because the bank has been found guilty of releasing negative research information to some investment banks regarding Apple before making such study public.
Because of that revelation, Apple’s shares noted about 5% decline between the time of the information leak and the public release of the study. This is not the first time Citigroup is finding itself on the wrong side of the regulatory law, in 2012, it paid out a fine of $2 million for almost a similar case.
Although the financial penalties involved in these settlements aren’t any big deal for the global bank holding, they have the effect of impacting negatively on its reputation. The company currently has $149.44 billion in market cap and a P/E ratio of 15.7.
