Citigroup Inc. - A major international financial conglomerate, which is one of the world leaders in the financial services industry. Citigroup - primary dealer of US Treasury securities.
Type - Public company
Year of construction - 1812
Location - 399 Park Avenue, New York, United States
Assets - $ 1.88 trillion (2013)
Number of employees - 251 000 (2013)
Citigroup Center on 53rd Street, New York
The history of the corporation now known as Citigroup - is the story of two different companies, Citicorp and Travelers Insurance. Citicorp was a global company, serving clients in more than 100 countries worldwide. Travelers Group was a union of many different companies ranging from Commercial Credit in Baltimore and ending with the actual Travelers (insurance).
Citicorp - heir to the First National City Bank, which was founded in New York in 1812. It was one of the oldest banks in the United States. First National City Bank had the largest overseas network of representative offices of all US banks.
The merger of Citicorp c Travelers Group was held in 1998. The merger was unlawful because of the prevailing at the time of the Glass - Steagall Act, which did not allow banks to merge with insurance companies. Chuck Prince and a group of lawyers dealing with this issue, found in the law of the article on which the US Federal Reserve could guarantee us a two-year trial period, after which the bank had to tear insurance assets. Executive Director of Citicorp felt that two years is enough to change the law. In the end, the act of the Glass - Steagall Act was denied legal effect of the adoption of the act of the Gramm - Leach - Bliley Act. However, Citigroup still had to sell substantially all of its insurance assets, probably due to the failure of the joint use of the assets of the two companies merged.
As of 2010 the corporation served 200 million customers in 139 countries and had over two thousand. Banking offices in 5 continents.
Citigroup and its predecessor companies-use business model of diversification of financial services. This model was first used by Prudential in the late 1970's. It involves combining different companies associated with the provision of financial services and investment banks, investment funds, insurance companies, brokerage houses. Since each of the companies individually have different profitability in different business cycles, so, theoretically, it is possible to achieve maximum profitability and stabilize revenues by combining the company. Also, this model is used to attract customers using a variety of financial services. Using a variety of financial services companies cheaper for the consumer than the use of financial products disparate companies.
Staying as an executive director of the Travelers Group, Sandy Weill (Eng.) Was focused on the expansion of the company and increase its turnover by acquiring other companies. Basically, Travelers acquired a brokerage and investment company. Most companies have acquired Travelers financial problems, so sold at a low price.
Former CEO of Citigroup, Chuck Prince refused a model of development, the company to focus on increasing turnover by selling a greater number of financial products, but not by means of mergers and acquisitions and reduce costs.
As of 2010 Citigroup consists of two separate units: Citicorp and Citi Holdings.
Citicorp - the bank to work with corporations and individuals. It includes a main profile business unit of Citi and presence in key growth markets around the world.
Global Bank to work with institutional clients Citicorp includes:
- International commercial banking operations with a global network in about 140 countries.
- Corporate and Investment Bank;
- Citi Private Bank: Banking customers with private wealth.
Retail bank Citicorp includes:
- Business credit cards around the world.
- Regional retail and commercial banks in the United States, Asia, Latin America, Central and Eastern Europe and the Middle East.
Citi Holdings is a group of non-core assets. At the initial stage, these business units and assets will include the following areas:
- Brokerage and Asset Management: including 49% share in the Morgan Stanley Smith Barney, a well Sordial Nikko Securities, Nikko Asset Management and Primerica Financial Services.
- Retail business at the local level: including CitiFinancial and CitiMortgage units in the US, as well as retail financial operations in Western Europe, Japan, India, Mexico, Brazil, Thailand and Hong Kong.
- Special Asset Pool will manage the assets included in the program for the sharing of financial loss to the US government, and other non-strategic assets.
Citicorp - the largest issuer of credit cards in the market of financial services. The Bank issues credit cards, even in countries that do not have their own offices. The Bank has offices in many countries around the world. Overall consumer structure brings about 50% of the company's profits.
Citigroup in Russia
In Russia, Citi is ZAO "Citibank". Citigroup was one of the first foreign financial institutions that have appeared in the Russian market. The Bank is represented in Russia ZAO "Citibank" (also used in Russia brand Citi), founded in 1993. Today, JSC "Citibank" is one of the largest in terms of assets and number of deposits. CJSC "Citibank" has more than 3000 people, the Bank serves over 1 million private clients in more than 50 offices and more than 450 ATMs in 11 Russian cities (with the operations center in Ryazan), including Moscow, St. Petersburg, Yekaterinburg, Rostov on-Don, Samara, Nizhny Novgorod, Ufa, Volgograd. Representative offices in Novosibirsk, Kazan, Krasnodar. Despite the relatively small network, the bank provides services to 1 million customers.
Citigroup participated in the IPO of such major Russian companies as Rosneft, VTB and Severstal underwriter, organizer, coordinator.