Fed bars shareholder payouts from Citi, four others

WASHINGTON/NEW YORK (Reuters) - The Federal Reserve on Wednesday rejected Citigroup Inc's plans to buy back $6.4 billion of shares and boost dividends, saying the bank is not sufficiently prepared to handle a potential financial crisis. The decision marks the second time in three years that Citigroup has failed to win the Fed's approval for its plan to return money to shareholders, known as the "capital plan." The rejection underscores that whatever strides Citi's chief executive, Michael Corbat, has made in fixing the bank's difficulties, he still has work to do. Shares of Citigroup, the third-largest U.S. bank, fell 5.4 percent to $47.45 in after-hours trading.

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