3 big U.S. banks called greater risks to global system

LONDON — Three of the United States’ biggest banks potentially pose a greater risk to the global financial system than they did last year if they were to fail, global regulators said Monday.

Citigroup, Bank of America and Wells Fargo, as well as the Industrial and Commercial Bank of China, all moved up in the latest ranking of so-called global systemically important banks by the Financial Stability Board, a Switzerland-based group of central bankers and financial regulators from the world’s largest economies.

Under the Financial Stability Board’s methodology, the change would normally subject the banks to additional capital requirements. However, the U.S. banks are already subject to high capital requirements set out by the Federal Reserve.

“The GSIB measure announced this morning by the FSB does not have an impact on any of Citi’s binding regulatory metrics,” a Citigroup spokeswoman said Monday.

The latest ranking came as Citigroup announced Monday that it would increase its common stock repurchase program by up to $1.75 billion, according to a regulatory filing.

On Monday, the Financial Stability Board also deemed three banks less risky to global financial stability than they were last year: Barclays, HSBC and Morgan Stanley. All three have sold part of their riskier businesses or reduced the size of some of them in the past year.

Worldwide, 30 lenders are considered global systemically important banks and are subject to additional capital requirements.

They are separated into five potential risk categories, the highest of which would have to hold an additional 3.5 percent of capital on top of minimum regulatory requirements. No banks were put in that highest risk category this year, which is intended to discourage banks from becoming more systemically important.