Citigroup's board approves $1.2 billion share buyback after clearance from Federal Reserve

NEW YORK, N.Y. – Citigroup Inc. says its board has approved a plan to buy back $1.2 billion of the company’s shares after getting clearance from the Federal Reserve.

The Fed last month approved the buyback plan after the lender passed a “stress test” to measure how it would fare in a recession.

The bank said Thursday that the program runs through the first quarter of next year.

One reason companies buy back their own stock is to offset the effect of paying employees in stock and options.

The bank will also pay another one-cent quarterly dividend in May. It hasn’t paid out more than that since late 2008, when the financial crisis began.