Chinese financial conglomerate Citic Group is reportedly planning to shut down two of its bank branches located in Los Angeles and New York in the wake of stringent regulatory requirements under the Volcker rule to be implemented next summer in the country.
Federal Reserve data cited by The Financial Times reports that both branches had total assets of under $500m as of 30 September 2013.
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As per the Volcker rule, firms managing retail banks in the US will be subject to stringent requirements. The banks will be restricted on investing directly with their own money and engaging in proprietary trading.
Despite looming branch closure, the bank is considering ramping up its US presence, as it is among a group of Chinese entities, along with China Investment Corp, that are considered bank holding companies by US regulators.
The bank is also planning to launch a massive restructuring, including $37bn of assets infusion from China into Citic’s Hong Kong listed unit Citic Pacific, the Financial Times reported citing several of its senior executives.
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