Citigroup, the world’s largest currency dealer, closed a program that provided leverage to some foreign-exchange clients without putting them through an extensive credit check.
Bloomberg News reports that the alternative credit program, started in 2007, allowed clients to get financing quickly that they then used to take positions in the spot foreign-exchange markets, usually for no longer than overnight, according to a person with knowledge of the program.
The firm shuttered it in January after the Swiss Central Bank unexpectedly removed a cap on the value of its currency, the person said, asking for anonymity discussing the program’s details.
'In an effort to rationalize our FX Prime Brokerage business, Citi exited the ACP program earlier this year', the bank said Thursday in a statement, without providing more details.
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