Overview
Citigroup is a financial services behemoth, headquartered in New York and is one of the largest of its kind in the financial services industry. It is also known as Citi and was formed as a result of the merger between Citicorp and Travelers Group in 1998. Citicorp was itself one of the leading players in the Banking space with Citibank as a subsidiary. Citicorp was well known for its international operations having presence in over 90 countries. After the merger with Travelers, Citigroup became a “financial hyper-mart” offering banking, securities trading and insurance as part of its offerings. The investment bank arm of the group is called Solomon Smith Barney. However, in 2005 the group sold off the insurance business to MetLife and this was the end of the banking and insurance cross functional model of sales. The main competitors are all the banking and brokerage companies like JP Morgan, First Financial etc.
Income
The revenue of the group in 2007 was $159 Billion and the net income was $3.5 Billion. The group is currently showing a decline in the profit ratio and it stock price as of Nov 10, 2008 is $11.21s. The largest shareholder in the group is Prince Al-Waleed bin Talal of Saudi Arabia who has a 4.9% stake. The rest is publicly held. The stock became a part of the Dow Jones Industrial Average in 1997.
Business
Citigroup’s main business is in the financial services industry with lending and banking in the retail segment and corporate banking for institutional customers. It has significant presence in these areas and as the motto goes “The Citi never sleeps”.
Citigroup is divided into three main divisions: Global Consumer, Global Wealth Management and Global services. In addition there are other smaller groups within the entity. The main revenue earner for Citigroup is the Global Consumer division that accounts for nearly 55% of the total revenues. This has been the case since the days before the merger with Travelers. The GCG is made up of Citi Cards, Citi Financial and Citibank. Together they service millions of consumers across the globe for their retail banking needs.
The Global Wealth Management group is dedicated to service the High Net Worth individuals and provide brokerage services to the securities industry. This division accounts for 7% of the total revenue of the group. The other division, Citigroup Global services is the technology and back office processing arm of the group. This is mainly based out of India and recently an Indian services company had acquired this division. Citigroup has taken the lead in actively participating in supporting the actions of the Federal Reserve in tackling the credit crisis arising out of the sub-prime meltdown. Citigroup is a household name in the financial services space and its logo and brand are universally recognized. It is a synonym for fair business practices though it has had its share of controversies. It must be said, to the credit of the management, that these were never allowed to threaten the stability of the group as a whole.
Citigroup has a long history of involvement with charitable causes. It takes its corporate social responsibility obligations seriously and partners with several Non Governmental organizations. Some of the activities that Citi undertakes are involvement with Micro Credit in Morocco and Bangladesh, Sustainable development projects in Brazil and support for environmental causes in the Asia Pacific region.
Sources
“Executive Summary”. 2008. Web.
“A Compelling Case for Citigroup”. Business Week. 2008. Web.
“Citigroup Current Stock Price”. Rogue Investor. 2008. Web.