'Challenges' cause Citi's troubled unit CEO to resign

Citigroup has said Javier Arrigunaga resigned as chief executive officer of Grupo Financiero Banamex, the most senior departure stemming from an alleged $400 million fraud disclosed in February.

Bloomberg News reports that Arrigunaga, 51, is being succeeded by Ernesto Torres Cantu, who joined the company about 25 years ago, the New York-based bank said Friday in a statement.

Torres, 50, will also take Arrigunaga’s place on Citigroup’s operating committee, according to a person briefed on the matter who asked not to identified speaking on personnel matters. Both are based in Mexico City.

Citigroup is investigating the alleged fraud, which involved loans to oil-services provider Oceanografia SA. CEO Michael Corbat has pledged to hold employees accountable and the bank has dismissed at least a dozen so far. A judge has ordered the company to turn over internal records to an Oklahoma pension fund that is suing the bank over the case.

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Citigroup Says Banamex CEO Resigns After ‘Challenges’

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