Citigroup Inc.

New or substantially reworded (8)

• For example, substantial new import tariffs and a significant increase in the U.S. Read more

  effective tariff rate occurred in 2025. There can be no assurance that there will not be additional significant changes in tariff or trade policies. Potential impacts in the U.S. and globally related to trade or tariff policies could include heightened market volatility, increased economic uncertainty, adverse impacts to inflation and global economic activity, disruptions in global supply chains and trade flows, impacts on corporate profitability and credit losses, and other adverse impacts.

• Central banks’ decisions on key interest rates directly affect borrowing and investment costs, loan and investment returns, and the valuation of financial assets. Read more

  U.S. and global interest rate levels can significantly affect Citi’s results of operations.

• Higher interest rates can negatively impact the economy, resulting in higher unemployment and lower growth. Read more

  Increases in interest rates can also adversely impact the fair value of available-for-sale (AFS) and held-to-maturity (HTM) debt securities held by Citi, and thereby Citi’s capital levels and regulatory liquidity position. Interest rate movements, as well as pricing and product competition, can also impact depositor behavior and thereby affect net interest income.

• Diverging legislative and regulatory changes and uncertainties regarding climate-related risk management and disclosures can increase Citi’s regulatory and compliance risks and costs. Read more

  Furthermore, Citi may face heightened scrutiny and litigation risks stemming from its climate and sustainability commitments, disclosures and marketing.

• The Development and Use of AI by Citi and Others Present Risks to Citi’s Businesses.

• Citi has used AI and machine learning tools for many years and has more recently begun to broadly deploy Generative AI, including within its technology platforms and services. Read more

  In the future, Citi expects to more broadly integrate Generative AI tools within its systems, businesses and functions, including advanced AI capabilities, such as autonomous agents and sophisticated user interactions, which if improperly managed, could result in increased risks and costs.

• While Citi has policies that govern the use of emerging technologies, including in model risk management, ineffective, inadequate or faulty Generative AI development or deployment practices by Citi or third parties, including insufficient testing and monitoring, poorly structured or manipulated prompts or insufficient or inadequate human oversight, could result in adverse consequences, such as AI algorithms that produce inaccurate or incomplete output or output based on biased, incomplete and/or inaccurate datasets, infringe on intellectual property rights of others, involve data exfiltration risks, including release of confidential or proprietary information, or cause other issues, concerns or deficiencies. The complexity of AI models, particularly Generative AI models, can make it challenging to understand why particular outputs are generated, which can increase the risk of erroneous…

• Citi may also rely on AI models developed by third parties and be exposed to risks arising from their development and training methods, including potential inclusion of unauthorized material in the training data or limitations in their risk mitigation strategies, over which Citi may have limited visibility or control (see also the operational processes and systems risk factor below). While Citi may provide restrictions on use of certain data in third-party AI applications or models, a third party could breach those terms, which could expose Citi to legal and reputations risks. Citi is also exposed to risks related to the use of AI technologies by counterparties, clients and vendors, where interconnected AI systems could amplify failures and threats of cyber infiltration, as well as cause widespread disruptions.

No longer in the text (4)

• For example, inflation could resurge if the FRB were to reduce interest rates prematurely and/or at too accelerated a pace, or if certain policies were further pursued in the U.S., including those related to trade, tariffs and immigration.

• For example, the Russia–Ukraine war could have further negative impacts on regional and global energy and other commodities and financial markets and macroeconomic conditions, adversely impacting jurisdictions where Citi operates and its customers, clients or employees. In addition, Citi’s remaining operations in Russia subject Citi to various other risks, including foreign currency volatility, such as appreciations or devaluations; restrictions arising from retaliatory Russian laws and regulations on the conduct of Citi’s remaining businesses, including, without limitation, its provision of certain securities services to customers; sanctions or asset freezes; and other deconsolidation events. For additional information about these Russia-related risks, see the operational processes and systems, cybersecurity and emerging markets risk factors and “Managing Global Risk—Other…

• The FRB’s annual stress testing requirements are integrated into ongoing regulatory capital requirements. Read more

  Citi’s SCB equals the maximum projected decline in its CET1 Capital ratio under the supervisory severely adverse scenario over a nine-quarter CCAR measurement period, plus four quarters of planned common stock dividends as a percentage of Citi’s risk-weighted assets, subject to a minimum requirement of 2.5%. The SCB is calculated by the FRB using its proprietary data and modeling of each firm’s results. Accordingly, Citi’s SCB may go up, based on the supervisory stress test results, thus potentially resulting in an increase in Citi’s required regulatory CET1 Capital ratio under the

• Standardized Approach. In addition, a breach of the SCB and other regulatory capital buffers may result in gradual limitations on capital distributions and discretionary bonus payments to executive officers. Read more

  For additional information on the SCB, see “Capital Resources—Regulatory Capital Buffers” above.