If you follow banking news -- and maybe even if you don't -- you have likely seen Citigroup (C 0.47%) popping up a lot lately, which might make you wonder if this is a stock you should consider buying. Citigroup is America's third-largest bank, with close to $2 trillion in total assets. It's also trading at roughly 60% of tangible book value at Thursday afternoon's prices, giving it a lot of potential upside. Let's take a look at all the recent Citigroup news and what it means for investors.

Good news and bad news

Citigroup has faced a mixed bag of headlines lately. Earlier this month, the bank tapped Jane Fraser to become its next CEO, making it the first megabank to hire a woman as chief executive. That followed other positive news this year showing Citigroup's dedication to environmental, social, and governance (ESG) issues, a fast-growing segment gaining traction among investors.

But Fraser's promotion has been sandwiched between a lot of bad news. In August, Citigroup accidentally wired $900 million to several creditors of the cosmetics brand Revlon; the lenders were suing Revlon over an issue relating to a $1.8 billion loan that Citigroup helped set up in 2016. Then, to complicate matters, the bank sued two of the lenders for not returning the portion of money they received due to the error.

Inside a Citibank branch

Image source: Citigroup.

Shortly after Citigroup named Fraser as its next CEO, The Wall Street Journal reported that the current CEO Michael Corbat was actually stepping down sooner than expected due to compliance issues at the bank. Additionally, the publication reported that federal regulators including the Federal Reserve and the U.S. Office of the Comptroller of the Currency are preparing to potentially hit Citigroup with some kind of consent order to get the bank to upgrade its internal risk-management controls. The Revlon incident may have been the last straw for regulators.

Adding to compliance issues, Buzzfeed recently reported on the banking industry's failure to stop money laundering, in which trillions have flowed through major banks to criminals, terrorist organizations, and Ponzi schemes. The report sent most big bank stocks tumbling. Citigroup was not a main subject of the report, but it was named.

Ultimately, investors should be concerned about the potential consent order and the need for Citigroup to update its internal controls, which could impact the bottom line.

Citigroup disclosed that the Revlon accident was caused by a "clerical error." Then, Bloomberg reported that the error resulted from "out-of-date" software. Believe it or not, many banks today still operate on old legacy core processors -- the technology that completes daily deposit, loan, and other banking transactions -- developed before the turn of the century. Updating these systems is a major undertaking. Citigroup CFO Mark Mason recently said at the Barclays Financial Services Conference that the loan processing system used in the Revlon transaction included "manual steps." It's not exactly how you might picture one of the world's largest banks operating in today's world.

Mason also said the bank is spending $1 billion this year alone to update the bank's "risk and control environment." He added that the bank would keep expenses "more or less flat," but we really don't know the extent of the consent order between the bank and regulators. These types of orders can last for years and require banks to spend heavily.

Is it a buy?

Citigroup's woes come at a bad time. The bank's revenue is suffering with interest rates so low, an environment that typically makes loans less profitable. As a result, Citigroup, like many banks, will likely be looking to bring annual expenses down to offset some of the pain. Mason said he thinks there is a significant opportunity to increase fee income, particularly in Asia, but there is just no way of knowing right now to what extent this can be accomplished.

Citigroup is not necessarily a bad investment, considering it's trading at a steep discount. As one of the largest banks in the world, it's not going anywhere. But it's hard to justify investing in Citigroup over competitors like JPMorgan Chase and Bank of America, which are best-in-breed bank stocks.