Citigroup Inc. is looking at more efficient ways to meet regulatory requirements so it can return more capital to shareholders, Chief Financial Officer John Gerspach said at a conference on Tuesday.
The company, the fourth-largest U.S. bank, has $45 billion in excess capital that could be returned to shareholders eventually, Gerspach said. Roughly $29 billion of that is in deferred tax assets that cannot be distributed immediately, while another $15 billion to $16 billion is sitting idle not earning profits, he said.
Like other big U.S. banks, Citigroup cannot return capital to shareholders through stock repurchases or dividends without permission from regulators. The Federal Reserve oversees an annual stress test whose outcome determines how they can use capital.
Another process known as "living wills," which requires banks to submit plans for dismantling themselves without taxpayer support in case of a crisis, also affects how they manage their businesses.
Citigroup is particularly focusing on improving its resolution plan, Gerspach said. In the past, it has failed the stress test and its resolution plan has been rejected. His comments come a day after the Trump administration detailed a plan that would ease regulations on big banks.
Gerspach also said trading across fixed income and equities is on track to be down 12 percent to 13 percent this quarter versus the second quarter of 2016, because of lower volatility.