BUSINESSMAN Oei Hong Leong and Citigroup have reached an out-of-court settlement over claims that he was misled by the bank into losing some $1 billion from foreign exchange and United States Treasury bond transactions.

In a brief statement on Thursday, the bank said: 'Citi and Mr Oei Hong Leong have reached an amicable settlement, as a result of which Mr Oei will be discontinuing the action. The terms of the settlement are confidential.'

Mr Oei could not be contacted but his legal representative, Mr Quek Mong Hua of Lee & Lee, confirmed the settlement and said a discontinuance of the suit will be filed today.

'It is a good ending,' he said.

In May, Mr Oei sued Citigroup's private banking arm in the High Court for negligence and misrepresentation, claiming that the bank - with which he has a 30-year relationship - repeatedly gave him an inaccurate picture of his trading exposure. This caused him to accumulate larger outstanding positions than he would have otherwise done so, he said.

When he knew the full extent of his exposure, he felt he had no choice but to close his positions despite the adverse market environment in October last year. This resulted in massive losses.

Citigroup, in its defence, denied any wrongdoing, claiming that Mr Oei was

a 'highly sophisticated' investor who was responsible for making all his investment decisions.

The bank also disputed the quantum of the losses as they did not take into account premiums that he had earlier received.

These claims and counter-claims were contained in legal documents submitted to the High Court but the case itself has not yet been heard in court.