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Missionary Oblates of Mary Immaculate  United States Province

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Citigroup Faith-Based Shareholders Call on US Government to Vote Its Shares in Favor of Derivatives Reform

April 17th, 2010

1357308Faith-based institutional investors are urging the Obama Administration to send the same message to Wall Street that it is sending to Congress on financial reform. The United States government controls 27 percent of outstanding Citigroup shares, and  faith-based shareholders say the US should support their Resolution urging the company to provide more disclosure about its derivatives trading. Voting will take place Tuesday morning at the Citigroup Annual Meeting in New York. The groups, which include the Missionary Oblates of Mary Immaculate, are members of the 300-member Interfaith Center on Corporate Responsibility (ICCR).

Rev. Seamus Finn, OMI, actively engaged in pressing financial institutions for greater transparency and accountability and an ICCR board member, said, “The U.S. government controls over a quarter of outstanding Citigroup shares today. It has an extraordinary opportunity here to send a clear message to Wall Street that more derivatives disclosure is vital. Even more to the point, the Treasury Department really has no choice other than to support our resolution since a failure to do so would directly undercut its campaign for critical financial reform.”

ICCR will host a phone-based news conference (with full, two-way Q&A) at 1:30 p.m. EDT on Tuesday, April 20, 2010 (dial 1-800-860-2442). That news event takes place in the wake of the vote Tuesday morning by Citi shareholders on a proxy resolution asking the financial institution to explain its policy on how collateral is secured for the derivatives they use and what their policy is about using customer funds for other speculative activities. The full text of the resolution is available online at

ICCR officials noted that, in recent weeks, top Commodity Futures Trading Commission (CFTC) and U.S. Treasury officials have urged Congress and Wall Street to embrace the financial services reform bill now on Capitol Hill. On March 11, CFTC Chairman Gary Gensler was quoted in the Financial Times:

“Who would not want the transparency [for derivatives] that you have in the stock market? … The only parties that benefit from a lack of transparency are Wall Street dealers.”

On April 12th, Deputy Secretary of the Treasury Neal Wolin told the Council of Institutional Investors: “… under the leadership of Chairman Dodd, the Senate Banking Committee has now voted out its own financial reform bill. Senator Dodd’s bill, too, is comprehensive and strong. We expect that bill to go to the Senate floor soon. As the President has made clear, we will fight hard against any efforts to weaken that legislation, and we will work to strengthen it further where we can … We cannot afford to wait to fix our flawed, outdated regulatory system … to [wait to] bring transparency and oversight to derivatives and other key financial markets … That’s what the Senate bill will do.”

ICCR Executive Director Laura Berry said: “To adopt an inconsistent posture at this critical juncture on derivatives disclosure would be disastrous both in terms of how Wall Street reads the signals from Washington and how seriously Congress sees the Obama Administration as being in its support of vital financial services reform.”

Subsequent shareholder votes will take place at Bank of America (April 28), Goldman Sachs (May 7), and JP Morgan Chase (May 18). Taken together, the resolution targets are four of the five U.S. financial institutions accounting for a reported 96 percent of all derivatives trading in the U.S

The four 2010 proxy season resolutions mark the first time that the banks will face such a vote, though JP Morgan Chase shareholders consider a 2004 resolution dealing with other aspects of derivatives.

A vote in the low double digits in favor of the new shareholder resolutions would be considered a major victory by shareholder advocates, who frequently only achieve single-digit support for new resolutions submitted at financial institutions. (With only 3 percent of the vote, shareholder resolutions may be resubmitted in a subsequent year.) However, there are signs of major and growing shareholder support for the notion of improved disclosure about derivatives.


For nearly 40 years the Interfaith Center on Corporate Responsibility (ICCR) has been a leader of the corporate social responsibility movement. ICCR’s membership is an association of 300 faith-based institutional investors, including national denominations, religious communities, pension funds, foundations, hospital corporations, economic development funds, asset management companies, colleges, and unions. The Missionary Oblates is a long-standing and active member in ICCR. Each year ICCR-member religious institutional investors sponsor over 200 shareholder resolutions on major social and environmental issues. For more information, visit

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