Citigroup Inc. (NYSE:C), a financial giant with a market capitalization of $152 billion, has announced the creation of a new series of preferred stock, the 6.950% Fixed Rate Reset Noncumulative Preferred Stock, Series FF, according to a recent SEC filing. The financial institution, which according to InvestingPro has maintained dividend payments for 15 consecutive years and currently offers a 2.76% dividend yield, filed a Certificate of Designations with the Secretary of State of Delaware on Monday, effectively amending its Restated Certificate of Incorporation.
The newly established preferred stock comes with an underwriting agreement dated February 5, 2025, involving Citigroup and various underwriters. This agreement pertains to the offering and sale of Depositary Shares, each representing a 1/25th interest in a share of the newly designated Series FF preferred stock.
In addition to the preferred stock, Citigroup has entered into a Deposit Agreement on Wednesday. This agreement involves Citigroup Inc., Computershare Inc., and Computershare Trust Company, N.A., serving jointly as Depositary, with Computershare Trust Company N.A. also acting as Registrar and Transfer Agent. The agreement governs the holders of Receipts, Depositary Shares, and the associated 6.950% Fixed Rate Reset Noncumulative Preferred Stock, Series FF.
The filing also includes the opinion of Skadden, Arps, Slate, Meagher & Flom LLP and a list of Citigroup Inc. securities registered under Section 12(b) of the Securities Exchange Act of 1934 as of the filing date.
This move by Citigroup, a leading financial services corporation headquartered in New York, signifies an expansion of its capital structure through the addition of the Series FF preferred stock. The information for this article is based on a press release statement.
In other recent news, Citigroup Inc. announced the issuance of 6.020% Fixed Rate / Floating Rate Callable Subordinated Notes set to mature on January 24, 2036. Meanwhile, the Federal Reserve has informed major US banks, including Citigroup, that they will no longer be required to participate in climate stress tests. Analyst firms Keefe, Bruyette & Woods and RBC (TSX:RY) Capital Markets have both upgraded their price targets for Citigroup, maintaining an Outperform rating due to the company’s strong financial performance.
In a legal development, a New York judge denied Citigroup’s motion to dismiss a case brought by Attorney General Letitia James, alleging the bank failed to protect and reimburse customers who were victims of fraud. The lawsuit will continue, with the court ruling that the Electronic Fund Transfer Act applies to unauthorized wire transfers made through Citigroup’s consumer accounts.
These are recent developments that highlight the evolving landscape for Citigroup. While the company faces legal challenges, it also shows strong financial performance and strategic moves in issuing new financial instruments and gaining favorable analyst upgrades. As these events unfold, investors and market watchers are keeping a close eye on the company’s progress.
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