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Published on : Mar 20, 2014

According to a source with knowledge of the matter told the news that Mexico’s third-largest and most popular bank named Banorte borrowed $40 million to the oilfield services company in Mexico. This lending of the money took place in the middle of the alleged fraud which in turn forced Citigroup to curb down its claimed profits of 2013. 

Banorte has made a provision for the loan in case of any type of non-payment scenario. However, the outcome of the loan will solely depend on the investigation processes conducted into the oil field services firm named Oceanografia. It is a significant firm of the state-run oil company Pemex in Mexico, added anonymity.

The Mexican government is made in charge of the Oceanografia case and has begun its criminal investigation for the same. The U.S. Federal Bureau of Investigation and Securities and Exchange Commission are further investigating this case with people having familiar probes and transactions. 

Citigroup uncovered approximately $400 million in bogus loans to Oceanografia at Banamex – a Mexican subsidiary. The $40 million figure would exemplify about 0.13 percent of Banorte’s loan portfolio. 

Furthermore, as per government’s instructions, it will neither nationalize nor rescue Oceanografia. Nevertheless, the source giving the information for this case declined to give any further details of the loan terms.