Citigroup Inc (C.N) shut down a $400 million hedge fund that used the bank's money and mathematical models to bet on stocks, in the wake of new regulations aimed at stopping proprietary trading, Bloomberg reported, citing a person familiar with the matter.
Citi, the third-largest U.S. bank by assets, closed the Quantitative Strategies fund after it named fund manager Shakil Ahmed as the head of electronic market-making in April, the news agency said.
Banks might have to spin off their trading platforms once the Volcker Rule -- which prohibits banks from trading for their own profit in securities, derivatives and other financial instruments or investing in hedge funds -- comes into effect.
Citigroup did not immediately respond to requests seeking comment, outside of normal U.S. business hours.
(Reporting by Rachel Chitra in Bangalore)
Copyright 2011 Thomson Reuters. Click for Restrictions.