Citibank drops gun policy after being slammed for discrimination
Citigroup has reversed its firearms policies after Trump accused Wall Street of discriminating against conservatives. The bank previously restricted services to clients selling firearms in certain circumstances after the devastating school shooting in Parkland, Florida in 2018.
However, the bank announced on Tuesday that it was scrapping its position and will have no specific firearms policy going forward. 'We appreciate the concerns that are being raised regarding 'fair access' to banking services, and we are following regulatory developments, recent executive orders and federal legislation that impact this area,' the banking giant said in a statement. It comes after President Trump has accused lenders of denying services to certain industries or political groups because of their political leanings.
In January, Trump publicly claimed that Citi rivals Bank of America and JPMorgan Chase were denying banking services to some conservatives. Speaking at the World Economic Forum Trump told Bank of America CEO Brian Moynihan that he hoped he would open the bank 'to conservatives, because many conservatives complain that the banks are not allowing them to do business.' He added: 'You and Jamie and everybody… What you're doing is wrong,' referring to JPMorgan Chase CEO Jamie Dimon. Both banks have previously refuted the claims.
Citi said it will also update its own employee code of conduct and access policies to include clauses that make clear it will not discriminate on the basis of political affiliation. Last year a dozen state auditors claimed that Bank of America had engaged in 'political de-banking.' De-banking is the process of an institution closing the account of a client it deems high risk. Bank of America said in a statement at the time that it has 'no political litmus test' for providing services.
Red states have since been pushing through laws intended to stop banks from denying services to conservatives, and the variable laws between states has created a regulatory frustration for banks. Citi's 2018 policy stated that it would not provide banking services to retail clients that sold firearms to anyone under 21 or to those who didn't pass a background check. It also said it would not serve clients that sold bump stocks or high-capacity magazines.
The policy covered small businesses, commercial and institutional clients, and credit card partners. However, it did not restrict how individual customers used their Citi cards and accounts. 'The policy was intended to promote the adoption of best sales practices as prudent risk management and didn't address the manufacturing of firearms,' Citi said on Tuesday.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
10 minutes ago
- Reuters
S&P Global 'positive' on Wells Fargo as regulatory burden lifts
June 6 (Reuters) - S&P Global (SPGI.N), opens new tab upgraded its outlook on Wells Fargo (WFC.N), opens new tab to "positive" from "stable", the ratings provider said on Friday, after the U.S. bank was released from a $1.95 trillion asset cap earlier this week. The U.S. Federal Reserve's unprecedented, seven-year long punitive measure was imposed on Wells in 2018 and restricted balance sheet growth so the bank could address rampant governance and compliance concerns that had been brought to light in a fake accounts scandal in 2016. The Fed's unanimous decision on Tuesday capped years of efforts by the bank to repair the damage and pay off billions of dollars in fines, sending Wells Fargo shares to a three-month high a day later. The stock has gained nearly 8.3% in a year where the benchmark S&P 500 (.SPX), opens new tab has remained flat. "The positive outlook on the holding company reflects our view that Wells Fargo has substantially improved its underlying governance, risk, and control profile, allowing for the removal of the Fed's asset cap," said S&P. S&P also expects Wells to expand its commercial and investment banking business, "the unit most affected by the asset cap and one that had to turn away some nonoperational deposits from customers." While the fourth-largest U.S. lender was forced to carefully manage wholesale deposits and its markets business, assets of peer JPMorgan Chase (JPM.N), opens new tab swelled by nearly $2 trillion since the start of 2018, while those of Bank of America (BAC.N), opens new tab and PNC Financial (PNC.N), opens new tab added about $1 trillion and nearly $200 billion, respectively.
Reuters
10 minutes ago
- Reuters
Shaken by crises, Switzerland fetters UBS's global dream
BERN, June 6 (Reuters) - Switzerland announced reforms on Friday to make its biggest bank UBS (UBSG.S), opens new tab safer and avoid another crisis, hampering the global ambitions of a lender whose financial weight eclipses the country's economy. UBS emerged as Switzerland's sole global bank more than two years ago after the government hastily arranged its rescue of scandal-hit Credit Suisse to prevent a disorderly collapse. The demise of Credit Suisse, one of the world's biggest banks, rattled global markets and blindsided officials and regulators, whose struggle to steer the lender as it lurched from one scandal to the next underscored their weakness. On Friday, speaking from the same podium where she had announced the Credit Suisse rescue in 2023 as finance minister, Switzerland's president Karin Keller-Sutter delivered a firm message. The country would not be wrongfooted again. "I don't believe that the competitiveness will be impaired, but it is true that growth abroad will become more expensive," Keller-Sutter said of UBS. "We've had two crises. 2008 and 2023," she said. "If you see something that is broken, you have to fix it." During the global financial crisis of 2008, UBS was hit by a losses in subprime debt, as a disastrous expansion into riskier investment banking forced it to write down tens of billions of dollars and ultimately turn to the state for help. Memories of that crisis also linger, reinforcing the government's resolve after the collapse of Credit Suisse. For UBS, which has a financial balance sheet of around $1.7 trillion, far bigger than the Swiss economy, the implications of the reforms proposed on Friday are clear. Switzerland no longer wants to back its international growth. "Bottom line: who is carrying the risk for growth abroad?" said Keller-Sutter. "The bank, its owners or the state?" The rules the government proposed demand that UBS in Switzerland holds more capital to cover risks in its foreign operations. That move, one of the most important steps taken by the Swiss in a series of otherwise piecemeal measures, will make UBS's businesses abroad more expensive to run for one of the globe's largest banks for millionaires and billionaires. Following publication of the reform plans, UBS Chairman Colm Kelleher and CEO Sergio Ermotti said in an internal memo that if fully implemented, they would undermine the bank's "global competitive footprint" and hurt the Swiss economy. The reform would require UBS to hold as much as $26 billion in extra capital. Some believe the demands may alter the bank's course. "It could be that UBS has to change its strategy of growth in the United States and Asia," said Andreas Venditti, an analyst at Vontobel. "It's not just growing. It makes the existing business more expensive. It is an incentive to get smaller and this will most likely happen." Credit Suisse's demise exploded the myth of invincibility of one of the wealthiest countries in the world, home to a global reserve currency, and proved as unworkable a central reform of the financial crisis to prevent state bailouts. For many in Switzerland, the government's reforms are long overdue. "The bank is bigger than the entire Swiss economy. It makes sense that it should not grow even bigger," said Andreas Missbach of Alliance Sud, a group that campaigns for transparency. "It is good that the government did not give in to lobbying by UBS. The question is whether it is enough. We have a banking crisis roughly every 12 years. So I'm not really put at ease." UBS CEO Ermotti had lobbied against the reforms, arguing that a heavy capital burden would put the bank on the back foot with rivals. The world's second-largest wealth manager after Morgan Stanley is dwarfed by its U.S. peer. Morgan Stanley shares value the firm at twice its book value, compared with UBS's 20% premium to book. On Friday, the bank reiterated this message, saying that it strongly disagreed with the "extreme" increase in capital. But others are sceptical that the government has done enough. Hans Gersbach, a professor at ETH Zurich, said there was still no proper plan to cope should UBS run into trouble. "The credibility of the too big to fail regime remains in question."
Telegraph
16 minutes ago
- Telegraph
Trump vs Musk is the final battle before economic catastrophe
Who needs reality TV when there's the psychodrama of Trump's White House to keep us all entertained? As plot lines go, the falling out between Elon Musk and Donald Trump was perhaps about as predictable as they come, but the sheer venom, speed and combustibility of the divorce has nevertheless proved utterly captivating. Even the best of Hollywood scriptwriters would have struggled to do better. The stench of betrayal hangs heavy in the air, a veritable revenger's tragedy of a drama. Beneath it all, however, lies a rather more serious matter than the sight of two of the world's richest and most powerful men breaking up and exchanging insults. And it's one which afflicts nearly all major, high income economies. Slowly but surely – and at varying speeds – they are all going bust. Yet few of them even seem capable of recognising it, let alone doing anything to correct it. None more so than the United States, where the Congressional Budget Office last week estimated that Trump's 'one big, beautiful bill' would add a further $2.4 trillion to the national debt by 2034. Let's not take sides, but Musk was absolutely right when he described the bill as 'a disgusting abomination'. It taxes far too little, and it spends far too much. It is hard to imagine a more reckless piece of make-believe. Musk had backed Trump not just out of self-interest – more government contracts, protection of the electric vehicle mandate, personal aggrandisement and so on – but because he genuinely believed he could help stop the US from bankrupting itself. This has proved a monumental conceit. The $2 trillion of savings in federal spending he initially promised has turned out to be at most $200bn, and probably substantially less once double accounting and wishful thinking is factored in. In any case, against total federal spending last year of nearly £7 trillion, it is but a drop in the ocean, and only goes to show just how difficult it is to find serious savings in government administration even when given a free hand with the headcount.
