Citigroup has agreed to pay $730 million to settle a class-action lawsuit that claimed investors were misled by the bank's disclosures when they purchased its debt and preferred stock. The investors' purchases were made from May 11, 2006, through Nov. 28, 2008. Citigroup Inc. denied the allegations and said in a statement late yesterday that it agreed to the settlement so it could get rid of further expenses and uncertainties that come along with drawn-out litigation.
"This settlement is another significant step toward resolving our exposure to claims arising from the financial crisis, and we look forward to putting this matter behind us," Citi said in a statement. Citigroup said that the proposed $730 million payment will be made from its existing litigation reserves. In January, Citigroup announced a settlement with federal regulators related to practices that resulted in illegal foreclosures. The bank took a fourth-quarter charge of $305 million to cover that agreement.