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Citi to pay US$1bn in RMBS claims

Citigroup announced on Monday that it will settle US$1.13 billion in claims stemming from mortgage securities the group sold during the financial crisis.

The firm will pay 18 institutional investors, including BlackRock Financial Management and Goldman Sachs Asset Management, to resolve legacy issues in its securities and banking business from between 2005 and 2008. 

The agreement does not release the firm from potential investor claims relating to alleged misrepresentations in the offering documents associated with these private-label securitisations, nor from any potential regulatory actions.

The settlement is subject to approval by trustees in the case and possible court approval.

"This settlement resolves a significant legacy issue from the financial crisis and we are pleased to put it behind us," Citigroup said in a statement.

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