Citigroup Inc is shutting down a loss-making proprietary trading business, Chief Financial Officer John Gerspach said in a conference call on Monday.
"We're close to two-thirds done winding down that particular position, that business," Gerspach told analysts on the company's third quarter conference call. He earlier blamed weak third quarter trading performance in part on winding down Citi's principal strategies business.
Banks including Goldman Sachs and Morgan Stanley have already unwound similar businesses in preparation for stricter government regulation under the Volcker Rule.
The Volcker Rule, which goes into effect next year, is aiming to prevent banks from making risky trades by prohibiting short-term trading for their own profit.
Citi spokeswoman Danielle Romero-Apsilos said Citi's Equity Principal Strategies unit, is a "de minimis part of Citi's overall trading operation."
"As it does not fit with Citi's business model under the impending Volcker rule, it is in the process of being wound down," Romero-Apsilos said in an emailed statement.
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