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Citi history
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Congress had declared hostilities in 1812 following tensions with Britain over America's trade with France.
The bank had already lent $500,000 to the underwriter of a government bond issue earlier in the year and had also subscribed to war bonds in 1813.
William Few was a former director of the Bank of the Manhattan Co. and became president of City Bank when Osgood died in 1813.
For the first time since 1813, shareholders did not receive their 25 cents a share quarterly dividend.
The backdrop to these dramatic events was the French Emperor Napoleon's vision of his country's global dominance, which was defeated - at least temporarily - at the hands of Britain and its coalition partners Austria, Prussia, and Russia in the spring of 1814.
As hostilities began winding down towards the end of 1814, City Bank lent the federal government $200,000 to help it meet interest and amortization payments on its debt.
Few was succeeded in 1817 by Peter Stagg, a fellow founding director who worked as the bank's cashier in the early years.
He was a brother of Washington Irving, author of Rip Van Winkle, published in 1819.
The trust company, the oldest in America, was formed in 1822 by a charter granted by the New York state legislature.
After failing to diversify its client base and allowing excessive borrowing by some directors, City Bank suffered so great a fall in its share value by 1824 that a merchant by the name of Charles Lawton stepped in to restructure the bank.
That year he acquired a controlling interest; by July 1825, he had convened a new board of directors to whom he sold his shares in the institution.
He was active in securing funding for the construction of the Erie Canal, completed in 1825, which connected the United States heartland to New York City and the shipping routes to Europe.
In 1827, Wright became president of City Bank and remained in that position for over five years.
A native of Connecticut, Charles Stillman moved to Mexico in 1828 and built up a successful business empire spanning cotton, real estate, and silver mining.
One of the first was Manhattan Gas Light Co., founded in 1833.
The original Merchants' Exchange, home to the Stock Exchange, stood here but was destroyed in the Wall Street fire of December 1835.
Until 1835, it was known as Farmers' Fire Insurance and Loan Co.
Such funds were volatile, however, leaving the bank particularly vulnerable when the Bank of England raised interest rates sharply in 1836, draining foreign exchange from the United States and triggering a slump in British demand for American cotton.
He first became involved with the bank after the Panic of 1837, and slowly acquired a controlling interest.
In the consequent Panic of 1837, City Bank teetered on the brink of failure.
Following the financial panic of 1837, the bank came under the control of Moses Taylor, a merchant and industrialist who essentially turned it into his own personal bank.
Moses Taylor became a director in 1843, and there had always been a high level of cooperation between the companies.
When it was published in 1845, three years before Astor's death, the sixth edition of Wealth and Biography of the Wealthy Citizens of New York City estimated Astor's wealth at $25 million.
By 1848, it was America's largest gas company.
When Mexico was forced to cede Texas in 1848 after a two-year war with the United States, Stillman helped found the border settlement of Brownsville.
Pyne spoke Spanish and had been Taylor's right-hand man since becoming a partner in his trading company in 1849.
Moses Taylor was one of the original investors in the New York, Newfoundland, and London Telegraph Co., founded in 1854 by Cyrus West Field, a successful young businessman who is credited with laying the first transatlantic cable.
In an obituary following Worth's death in 1856, the newspaper wrote, "He frequently employed his leisure hours in literary composition, and his productions in prose and verse, though not often allowed to appear in print, were handed round among his friends and read with pleasure."
The first cable was completed in 1858 but soon broke down.
Fox would later become president of New York Gas Light Co.; he remained on the City Bank board until 1861.
In the first major battle of the war, the Confederates of the breakaway southern states defeated the Union forces of President Abraham Lincoln in the First Battle of Bull Run in eastern Virginia in 1861.
Workers found a cannonball embedded in a wall, a keg of gunpowder and more than 100 old-fashioned bombs, probably intended to protect the Custom House during the Draft Riots of 1863.
The Travelers Insurance Company was founded in 1864 by James Batterson, a stonecutter.
The bank grew as New York City became the nation’s commercial and financial capital, and in 1865 it was chartered under the National Bank Act and renamed the National City Bank of New York.
That year it sold the first accident insurance in the United States, and in 1865 it began selling life insurance, thus becoming the first company in the country to offer more than one type of insurance.
In 1866, the Transatlantic Cable, the brainchild of Frederick Gisborne and Cyrus Field, who founded the New York, Newfoundland and London Electric Telegraph Company, was laid.
A director of City Bank since 1869, Pyne managed not only the bank but also Taylor's entire business empire.
In 1870, his business partner Benjamin Dunning became a director of the bank.
When Moses Taylor died in 1882, he was succeeded as City Bank president by his son-in-law Percy Pyne, a British immigrant whose father had been a seal-skin broker on Wall Street.
Taylor was the treasurer of the company that laid the first transatlantic cable, which made international trade much more feasible. It was at this early stage that NCB adopted the eight-letter wire code address “Citibank.” Taylor died in 1882 and was replaced as president by his son-in-law, Percy R. Pyne.
The company organically entered the leasing and credit card sectors, and its introduction of United States dollar-denominated certificates of deposit in London marked the first new negotiable instrument in the market since 1888.
In 1889, Stillman duly became a director of Farmers' Loan and Trust Co.
Then, when Pyne resigned as National City Bank president after a stroke in 1891, the bank's board elected Stillman his successor.
When James Stillman became president after Percy Pyne's resignation in 1891, it had only three officers (the president himself and two cashiers) and a handful of staff.
After Union Pacific Railway went into receivership in 1893, National City Bank seized a chance to break into the big league of investment banking.
After the panic of 1893, NCB, with assets $29.7 million, emerged as the largest bank in New York City and the following year, became the largest bank in the United States.
Vanderlip later became financial editor of the Chicago Tribune and, in 1894, bought a part interest in the Chicago Economist, where he served as associate editor for three years.
Pyne remained on the board as a director until his death in 1895, allowing for a smooth transition at the helm of a bank which, for half a century, had been largely dominated by a single family.
In response to their needs, in 1897 the bank opened a foreign exchange department, offering to buy and sell drafts, make cable transfers and collections, and issue travelers' letters of credit.
When Lyman Gage, president of First National Bank of Chicago, was appointed secretary of the United States Treasury in 1897, he took Vanderlip with him to Washington as his private secretary.
The flood of new business permitted NCB to expand; in 1897 it purchased the Third National Bank of New York, bringing its assets to $113.8 million.
One of the first big transactions of the new foreign exchange department came in 1899, when the bank received a $5-million deposit from the United States Treasury.
In 1899, it was bought by National City Bank for $3,265,000.
Vanderlip was particularly struck by the regional commercial potential offered by the Philippines, the Spanish colony acquired by the United States as part of the treaty ending the Spanish-American war in 1899.
Created through the consolidation of several producers of metal cans for the food industry, American Can monopolized 90 percent of the nation’s can-making capacity when it was founded in 1901.
His successor as president was Frank Vanderlip, who had worked for the bank since 1901, overseeing the establishment of the bond department.
Shanghai was IBC's first branch in China, opened in 1902, the same year as its branches in Singapore, Hong Kong, Yokohama, and Manila.
Hubbard, who had previously worked as financial officer for Southern Pacific Railway, assumed the presidency following Marcellus Hartley's death in early 1902.
The International Banking Corporation, later acquired by National City Bank, set up its first branch in Mexico City in 1903 and a second in Monterrey the following year.
On August 17, 1904, at the United States government's request, IBC opened a branch in Panama City, followed two years later by one in Colón, on the Atlantic side of the young country.
In 1904, the bank began to put out a monthly bulletin, United States Securities and Government Finance, written by vice president Frank Vanderlip, formerly assistant treasury secretary in Washington.
By 1906, Union Pacific Railway had acquired shares in five railroads that now lay at the core of the National City Bank's activities.
By 2011, Li & Fung was a multinational group employing close to 37,000 people in 40 economies. It was founded in 1906 by Fung Pak-liu, a Hong Kong-educated schoolteacher who had recently returned to Guangzhou, and Li To-ming, a Chinese merchant whose family owned a porcelain shop.
One of Stillman's colleagues commented, "The idea of occupying an entire city block with a bank was something that made everyone raise his hands in consternation." In 1907, the bank commissioned the leading architects of the day, McKim, Mead and White, to adapt the building.
Over $70 million in cash and $500 million in securities were transferred by hand to the two-story steel vault, and the new building was opened to the public on December 21, 1908.
Over the next three years, the National City Company expanded significantly. It was modeled on the First Security Co. founded in 1908 by First National Bank, a blue- ribbon corporate bank which National City Bank acquired almost half a century later.
Additional branches were established in the Chinese cities of Beijing and Hankou in 1909.
Two years later, the company arranged a $19.9-million bond issue for Oriental Development Co., the Japanese government agency responsible for developing Korea, who had been annexed by Japan in 1910.
In 1911, National City Bank set up an investment affiliate.
The establishment of National City Company as an affiliated securities firm in 1911 gave rise to advertising activities soon transferred to the bank itself.
By 1912, National City Bank had correspondent banking relationships with 132 banks worldwide and deposits with them amounting to $6 million.
Following the passing of the Federal Reserve Act in 1913, National City Bank became the first nationally chartered bank to establish branches abroad.
Vanderlip worked long and hard to change the government’s policy and eventually won in 1913, when Congress passed the Federal Reserve Act.
After the bank began setting up foreign branches in 1914, a new monthly publication known as The Americas was launched.
National City Bank's first foreign outpost, the Buenos Aires branch, opened in late 1914, was almost immediately profitable thanks in part to a large foreign-exchange business.
In 1914, chairman James Stillman offered his Paris residence to the French government for use as a hospital.
A second foreign branch was established in Rio de Janeiro, Brazil, in April 1915, with a sub-branch in Santos, the coffee-trading center.
In 1916, the affiliate acquired Wall Street securities firm N.W. Halsey and Co. with branches in four cities on the United States East Coast and two in Europe.
Although much of Europe was at war, National City Bank opened a branch in the Italian port city of Genoa in 1916.
In 1917, National City Bank abandoned the system of automatic salary increases at the beginning of January, relegating it to "the limbo of mid-Victorian business methods." From now on, salaries would be based on merit.
Partly buoyed by the government drive to sell war bonds to the public in 1917, the National City Company began merchandising corporate bonds like any other daily household item.
Over six weeks in 1917, former librarian Florence Spencer and another assistant chief clerk interviewed more than 1,000 candidates.
The United States, after initial efforts by the government to resist involvement, entered the fray in 1917 following a sea-change in United States public opinion.
1918: Foreign operations are enlarged through the purchase of International Banking Corporation.
Until then "it was considered almost unethical for bond dealers to seek business in ways approved by general merchandisers," the president of National City Company, Charles Mitchell, told trainees in 1919.
By 1919, National City Bank had a fully fledged publicity department.
In 1919 Frank Vanderlip resigned in frustration over his inability to secure a controlling interest in the company, and James A. Stillman, the son of the previous Stillman, became president.
1919: NCB is the first United States bank to reach $1 billion in assets.
George Kurz spent considerable time flying in Europe while posted in Berlin as the bank's representative to Central Europe and the Balkans during the 1920s.
Senior officers of the bank were no strangers to air travel in the 1920s.
Advertising grew as the bank ventured into retail banking from 1921.
In 1921, the company introduced the first Australian borrower to the United States market by arranging a $12-million issue of 20-year bonds for the state of Queensland.
The year 1921 saw the acquisition of the Commercial Exchange Bank, and three domestic branches as part of the bargain.
Charles E. Mitchell, Stillman’s successor in 1921, completed much of what Vanderlip had begun, creating the nation’s first full-service bank.
In 1922, National City Bank also acquired a controlling interest in Banque Nationale de la République Haiti.
In 1923, staff produced 80,000 copies of an eight-page booklet containing the financial statement for March 31 plus lists of directors, executives, overseas branches, as well as a letter from president Charles Mitchell.
Among domestic deals, the company set a world record in 1923 when it teamed up with the Guaranty Co. of New York to arrange a $100-million issue of bonds and debentures for a leading copper and mining company.
The year 1924 thus saw National City Bank represented by branches at 42nd Street and Madison Avenue; at 28th Street and 5th Avenue; at the Bowery branch; at 57th Street and 7th Avenue; and at 72nd Street and Amsterdam Avenue.
The bank's presence in northern Italy was expanded in 1925 with the opening of a branch in Milan.
The Art Deco-style former Canal Street/Broadway branch, which is still standing, was opened in 1927.
In 1928, Elida Arias was appointed as subaccountant of the Panama branch of National City Bank, and so became the only woman among approximately 500 signing officers of the bank worldwide.
And in 1928 Citibank began to offer personal consumer loans.
The merger was ratified by the boards of both companies on June 29, 1929.
Ripley was also a director of Pacific Zeppelin Transportation Corp., an affiliate of Goodyear Zeppelin Corp. which began building the world's largest airship, the ZRS-4, in Akron at the end of 1929.
William Hoffman, another vice president, got a first-hand look at the latest German aeronautical technology in 1929.
Following a change in the law that allowed national banks to have full-service branches as long as they conformed to state law, by the end of 1929 National City Bank had 37 domestic branches in Manhattan, Brooklyn, Queens, and the Bronx, the fifth-largest domestic branch system in the country. It is not hard to see a family resemblance between this and its grander cousin in Buenos Aires, opened in 1929.
The first trip took place in mid-1931.
He first became a client of National City Bank in 1931.
According to James Perkins, who succeeded Charles Mitchell as the bank's chairman in 1933, average gross deposits fell from $1.26 billion in the week ending February 18 to $967 million in the week ending March 25.
During the bank moratorium of 1933, declared by President Roosevelt to prevent a bank run due to lack of public confidence, National City Bank's competitors predicted that the overseas branches would bleed the bank dry of funds.
But in 1933, at the height of the Depression, Congress passed the Glass-Steagall Act, which restricted the activities of banks by requiring the separation of investment and commercial banking.
Despite the Glass-Steagall Act of 1933, which forbade banks from owning insurers and insurers from owning banks, the merger was approved by the Federal Reserve Board.
1933: Passage of the Glass-Steagall Act forces NCB to divest its securities affiliate and greatly reduce its financial services offerings.
Colonel Samuel Osgood founded City Bank of New York in 1812, later renamed National City Bank of New York. It became the first commercial bank to offer consumer loans and by 1939 had more than 100 offices in foreign lands.
Titled "First in Worldwide Banking," and launched in 1946, this was the United States financial industry's first nationwide advertising campaign.
In the United States, the Ships Sales Act of 1946 released a large number of vessels onto the market, including many of those known as Liberty ships.
Wriston, a product of Wesleyan University and the Fletcher School, had worked his way up through the company’s ranks since joining the bank in 1946.
Citi financed the construction of Onassis' first supertanker in 1948.
Under this initiative, later known as the Marshall Plan, National City Bank arranged a large number of commercial letters of credit for shipments to countries receiving United States government aid. It was not until mid-1948 that the bank reopened the Paris branch of the International Banking Corporation, its foreign banking subsidiary.
By the time the program came to an end in 1951, the United States had channeled almost $13 billion to Western European countries and Turkey.
The main recipients were Britain, France, and the new Federal Republic of Germany, where the bank established a representative office in Frankfurt at the beginning of 1953.
The bank merged with First National Bank of New York in 1955, becoming the First National City Bank of New York in 1955.
Six years later, in an attempt to circumvent federal regulations restricting a bank's activities, Citibank created a one-bank holding company (a type of company the Bank Holding Company Act of 1956 had overlooked) to own the bank but also engage in lines of business the bank could not.
By 1957, however, the bank had just about depleted its bond reserve.
In 1958, First National City Bank decided to join the exodus.
Travelers introduced its logo—a red umbrella to symbolize protection—in 1960.
The new premises at 399 Park Avenue were officially opened on March 27, 1961.
While it had also moved into long-term corporate lending, aircraft leasing, and factoring, First National City Bank's biggest coup was to pioneer the negotiable certificate of deposit (CD) in 1961.
The squeeze on funds only became more acute until 1961, when the bank introduced a new and ingenious product: the negotiable certificate of deposit.
1962: The name of the bank is shortened to First National City Bank.
The "New York" was dropped in 1962 on the 150th anniversary of the company's foundation.
The Gulf presence expanded to include a Dubai branch in 1964.
In 1965 the company was renamed The Travelers Corporation.
As Fortune noted, "the new instrument took the banking community by storm," with the value of outstanding negotiable CD issues reaching $15 billion by 1965.
In 1967 Walter Wriston assumed the presidency.
In 1967, a second branch opened in Saudi Arabia, in Riyadh.
According to Al Costanzo, who took over the overseas division in 1967, management began to analyze "where you made money and where you lost money.
Also in 1967, First National City Bank reorganized as a one-bank holding company, First National City Corporation, or "Citicorp" for short.
The bank introduced its First National City Charge Service credit card—popularly known as the "Everything card" and later to become MasterCard—in 1967.
A solution was found in moving these processes to a dedicated new building at 111 Wall Street in 1968.
As a first step, shareholders approved the establishment of a holding company, First National City Corporation, in 1968.
1968: A one-bank holding company, First National City Corporation (FNCC), is created and becomes the parent of the bank.
He became a director in 1969.
Walter Wriston became chairman in 1970.
For instance, Richard Braddock, a former brand manager at General Foods, was recruited in 1973.
In 1973 Citi appointed its first woman director, Eleanor Sheldon, a sociologist and president of the Social Science Research Council.
Leindorf, David, and Donald Etra, Ralph Nader’s Study Group Report on First National City Bank, New York: Grossman, 1973.
An office in Tehran followed in 1974, the same year that First National City Bank opened a Jordan branch.
Although it was costly to set up, the global consumer business, established in 1975, became a vital pillar of the group.
In 1975, a new branch was opened in North Yemen.
Following a one-year trial, the system was extended in late 1975 to give customers with checking accounts the four most frequently sought pieces of information, including the account balance at 8:00 a.m., and the date the customer's last check had cleared the account.
In 1975, however, the company’s fortunes fell dramatically.
In 1976, Ho was named as a director of a finance and investment subsidiary of Li & Fung, and later he became group managing director.
The bank changed its name to Citibank, N.A. (National Association), in 1976, following its parent holding company's change to Citicorp.
Our first was to introduce a complete system for the City of New York." The ATM was launched at a branch in Queens in 1977.
The former Citicorp Center, completed in 1977, is one of the most distinctive features of the New York skyline, and one of the most robustly built.
Citibank entered the credit card market and became the largest issuer in the United States by 1977.
Another notable appointee was Brazilian financial technocrat Mario Simonsen, who joined the board in 1980 when he was vice chairman of the Brazilian Institute of Economics.
But the oil shock following the revolution in Iran sent interest rates soaring in the opposite direction: Citicorp lost $450 million in 1980 alone.
To add insult to injury, Citibank purchased $3 billion in government bonds at 11%, in the belief that interest rates would continue a decline begun during the summer of 1980.
John S. Reed was elected CEO in 1984, and Citi became a founding member of the CHAPS clearing house in London.
Citibank entered the credit card market and became the largest issuer in the United States by 1977. It was also the first bank to present ATMs (automatic teller machines). John Reed, the individual behind the creation of these machines, became Citicorp's chairman in 1984.
During this period, Travelers acquired Shearson Lehman—a retail brokerage and asset management firm that was headed by Weill until 1985—and merged it with Smith Barney.
Citicorp bought the stock quotation service for $680 million in 1986 at a time when the company was hoping to expand in the information business.
1987: Citicorp sets aside a $3 billion reserve fund as a provision against potentially bad Third World loans and also posts a $1.2 billion loss for the year.
Citibank had established a Polish subsidiary in 1991.
Third quarter financial statements for 1991 reflected the impact of restructuring charges, asset write-downs, and additions to reserves necessary for coverage of non-performing loans: Citicorp reported an $885 million loss.
By 1991 the company had lost $457 billion, and fears of total failure plagued the minds of investors and analysts.
Quotron Systems, Inc. could not compete with the updated technology of its rival, Automatic Data Processing (ADP). In 1992 Citicorp sold two Quotron divisions to ADP, the leader in the computer services market.
In addition, Citicorp’s freedom to make loans was abridged in 1992 when it was placed under regulatory supervision.
However, Citicorp sold approximately 60 percent of its holdings in 1993 at a loss.
The Asia Pacific region remained a prosperous area of growth for Citicorp, reaping profits in 1994 of $781 million, more than one-fifth of the company's total profits.
Zweig, Phillip L., Wriston: Walter Wriston, Citibank, and the Rise and Fall of American Financial Supremacy, New York: Crown, 1995.
Credit cards, in turn, churned up $1.2 billion for the company in 1995.
holland, kelley. "the ceo who never sleeps." business week, 29 january 1996.
loomis, carol j. "citicorp: john reed's second act." fortune, 29 april 1996.
marcial, gene g. "irate at a miserly student loan." business week, 27 may 1996.
Under the direction of chief executive officer Sanford I.Weill, Primerica renamed itself Travelers Group and in 1996 bought the casualty and property insurance businesses of the Aetna Life and Casualty Company.
In 1996, the Citi Islamic Investment Bank was set up in Bahrain.
In 1996 a Citibank employee was accused of helping Raul Salinas, brother of Mexican president Carlos Salinas, sneak out of Mexico funds acquired by illegal means.
Bank Handlowy returned to the Warsaw Stock Exchange in 1997, after an absence of almost 60 years.
Global corporate banking net income was $753 million in the first quarter, up $104 million or 16 percent from 1997.
Officers: John S. Reed, Chmn., 58, 1997 base salary $31,100,792; Paul J. Collins, VChmn.
By 1997 Citicorp obtained more than half of its profits from new, developing international markets.
On April 2, 1998, Citibank completed the acquisition of AT&T Universal Card Services.
chase, brett. "chase profits down 22% slim 7% rise for citicorp." american banker, 22 april 1998.
glasgall, william. "just the start?" business week, 20 april 1998.
aley, james. "john reed speaks." fortune, 11 may 1998.
Citigroup was founded on October 8, 1998 and is headquartered in New York, NY.“
One spring evening in 1998, Citibank's chairman, John Reed, sat down to dinner with Sanford I. Weill, the chief executive of Travelers Group.
Further embarrassment from Mexico ensued for Citicorp when its 1998 purchase, Banco Confia, was brought up on charges of laundering drug money.
The rift between Citibank and Travelers Group became apparent in late 1998 when Jamie Dimon, likely successor to Citibank’s joint chairmen Weill and Reed, abruptly quit.
The projected target date is the third quarter 1998.
“Financial Mergers: Complex Equations,” Economist, June 5, 1999.
Not coincidentally, former United States Treasury Secretary Robert E. Rubin had joined Citi as an adviser in 1999.
In 1999 Citibank announced a project to simplify its service offerings in an effort to reduce costs.
Citibank Mortgage was similarly renamed CitiMortgage, Inc. in April 2000.
In fall of 2000 Bank of America launched a one-year, $100 million advertising campaign.
2000: Associates First Capital Corporation, a consumer finance company specializing in subprime loans, is acquired and merged into CitiFinancial.
Competitors, among them JPMorgan Chase, Bank of America, Merrill Lynch, and Morgan Stanley, worked to chip away at Citibank's market share. It included television, radio, and print advertising and was introduced during the 2000 Olympic Games.
In 2001, Citigroup made additional acquisitions: European American Bank, in July, for $1.9 billion, and Banamex in August, for $12.5 billion.
With the help of newly hired advertising agency Fallon Worldwide of Minneapolis, Citibank launched the "Live Richly" advertising campaign in 2001.
In a 2001 press release Fallon Minneapolis president and executive creative director David Lubars commented, "Citibank's new creative is a significant departure from advertising traditionally seen in this category.
In 2001 Chase Manhattan and JP Morgan & Company merged to form JPMorgan Chase.
The new financial services conglomerate came under Weill’s leadership and assumed the red umbrella logo, retaining it even after spinning off, in 2002, the property and casualty insurance business to form a new, publicly traded firm called Travelers Property Casualty Corp.
In 2002, it paid the second-largest settlement in securities history, $2.7 billion, to WorldCom investors and bondholders over fraud charges.
They're saying: 'Concentrate on the things that make life rewarding; we'll take care of the complicated stuff.' It's a great message." The advertising industry agreed, and "Live Richly" won a Gold EFFIE Award in 2002.
In July 2003 Citigroup and J.P. Morgan reached an agreement with the SEC and others whereby they would pay a total of $305 million to settle the Enron case, with Citigroup's share being $145.5 million.
Meantime, two other July 2003 announcements signaled that Citigroup had weathered the scandal storm: the firm said that it would increase its dividend by 75 percent and that it would acquire the huge credit card business of Sears, Roebuck and Co. for about $3 billion.
In July 2003 Weill made headlines through a long-anticipated announcement: the tapping of a successor.
The Salomon Smith Barney name was abandoned in October 2003 after a series of financial scandals that tarnished the bank's reputation.
In 2003, it renamed Salomon Smith Barney "Citigroup Global Markets Inc." "Smith Barney" became a private wealth management division.
Weill said that he would step down as CEO at the end of 2003, and Charles O. Prince was named to succeed him.
In 2003 the Rainforest Action Network, an environmental organization, launched a contest calling for fake advertisements that highlighted Citibank's allegedly corrupt business practices and environmental and social destruction.
Weill said that he would step down as CEO at the end of 2003, and Charles O. Prince was named to succeed him. For example, Citigroup announced that at the beginning of 2003 it would begin expensing the cost of all stock options for employees, management, and board members, a move that many observers believed was necessary to provide a more accurate accounting of the finances of a company.
Citigroup reportedly reaped $47 million in net profits a day in 2004 and ruled the financial-services industry.
Also in 2004 JPMorgan Chase acquired Bank One, the sixth-largest bank in the United States.
The "Live Richly" campaign's "Tire Swing" commercial was named one of Adweek magazine's "Best Spots" of 2004.
Travelers merged with The St Paul Companies Inc. in 2004 forming The St Paul Travelers Companies.
Established in 2005, Citi Inclusive Finance (founded as Citi Microfinance) is a commercial initiative.
Citigroup retained the life insurance and annuities underwriting business; however, it sold those businesses to MetLife in 2005.
The subsequent investigation revealed that the Consumer Lending Group had suffered a breakdown of internal controls since 2005.
Starting in June 2006, Senior Vice President Richard M. Bowen III, the chief underwriter of Citigroup's Consumer Lending Group, began warning the board of directors about the extreme risks being taken on by the mortgage operation that could potentially result in massive losses.
When Bowen first became a whistleblower in 2006, 60% of the mortgages were defective.
Although Citigroup's reputation had certainly been tarnished by the firm's involvement in the wave of corporate scandals that rocked the United States in the early 2000s, Weill tried to win the public relations battle by adopting reform measures ahead of the regulators and legislators. It also was announced that the head of the Citigroup consumer banking operation, Robert B. Willumstad, would succeed Prince as COO. Weill planned to stay on as chairman through early 2006.
Facing significant losses on its mortgage portfolio, Citigroup commenced raising capital through public and private offerings that raised more than $30 billion over two months in late 2007.
While the new company maintained Citicorp's "Citi" brand in its name, it adopted Travelers' distinctive "red umbrella" as the new corporate logo, which was used until 2007.
The number of bad mortgages began increasing throughout 2007 and eventually exceeded 80% of the volume.
With the crisis worsening, Citigroup announced on January 7, 2008, that it was considering cutting another 5 percent to 10 percent of its 327,000 member-workforce.
However, in 2008, economic conditions deteriorated further, culminating in the collapse of the 158-year-old Lehman Brothers investment bank in September, and prompting further upheavals in the credit and equity markets.
By November 2008, Citigroup was insolvent, despite its receipt of $25 billion in taxpayer-funded federal Troubled Asset Relief Program funds.
On November 24, 2008, the United States government announced a massive bailout for Citigroup designed to rescue the company from bankruptcy while giving the government a major say in its operations.
In January 2009 Citigroup announced plans to split the firm into two new companies, Citicorp and Citi Holdings.
In January 2009, Citi announced a reorganization that would allow it to focus on its core banking franchise while reducing non-core assets over time.
On January 16, 2009, Citigroup announced its intention to reorganize itself into two operating units: Citicorp for its retail and institutional client business, and Citi Holdings for its brokerage and asset management.
On January 13, 2009, Citi announced the merger of Smith Barney with Morgan Stanley Wealth Management.
On June 1, 2009, it was announced that Citigroup would be removed from the Dow Jones Industrial Average effective June 8, 2009, due to significant government ownership.
By December 2009, the United States government stake was reduced from a 36% stake to a 27% stake, after Citigroup sold $21 billion of common shares and equity in the largest single share sale in United States history, surpassing Bank of America's $19 billion share sale 1 month prior.
After the introduction of the new branches, Citi was soon ranked as top retail bank in Japan by Nihon Keizai Shimbun, the financial newspaper, as compared with 57th place in 2009.
In 2009, Jane Fraser, the CEO of Citi Private Bank, stopped paying its bankers with a commission for selling investment products, in a move to bolster Citi Private Bank's reputation as an independent wealth management adviser, as opposed to a product pusher.
The Financial Crisis Inquiry Commission asked him to testify about Citigroup's role in the mortgage crisis, and he did so, appearing as one of the first witnesses before the Commission in April 2010.
McLean's company evolved into Maersk Sea-Land, which, by 2011, was shipping more than a million containers a year.
In 2011, Citi was the first bank to introduce digitized Smart Banking branches in Washington, D.C., New York, Tokyo and Busan (South Korea) while it continued renovating its entire branch network.
By June 2012, the year of Citi's 200th anniversary, Citigroup had built up $420 billion in surplus cash reserves and government securities.
In 2012, the Global Markets division and Orient Securities formed Citi Orient Securities, a Shanghai-based equity and debt brokerage operating in the Chinese market.
In June 2013, Citi sold its remaining 49% stake in Smith Barney to Morgan Stanley Wealth Management for $13.5 billion following an appraisal by Perella Weinberg.
In 2013, Sanjiv Das was replaced as head of CitiMortgage with Jane Fraser, former head of Citi Private Bank.
To comply with the Volcker Rule, which limits bank ownership in hedge funds to no more than 3%, Citi spun off its hedge fund unit in 2013 and gave a majority of the company to its managers.
In October 2014, Citigroup announced its exit from consumer banking in 11 markets, including Costa Rica, El Salvador, Guatemala, Nicaragua, Panama, Peru, Japan, Guam, the Czech Republic, Egypt, South Korea (consumer finance only), and Hungary.
The company's remaining foreign exchange sales & trading businesses continued operating in the wake of this deal under the leadership of James Bindler, who succeeded Jeff Feig as the firm's global head of foreign exchange in 2014.
On March 11, 2015, Citi has passed its first CCAR test, allowing it to raise its dividend to 5 cent a share and unveiling a plan for a $7.8 billion share repurchase.
In May 2015, the bank announced the sale of its margin foreign exchange business, including CitiFX Pro and TradeStream, to FXCM and SAXO Bank of Denmark.
In November 2015, Springleaf acquired OneMain Financial from Citigroup.
In February 2016, the company was subject to a lawsuit as a result of the bankruptcy of a Mexican oil services firm.
In February 2016, Citi sold its retail and commercial banking operations in Panama and Costa Rica to the Bank of Nova Scotia (Scotiabank) for $360 million.
In April 2016, Citigroup announced that it would eliminate its bad bank, Citi Holdings.
On June 23, 2016, Federal Reserve handed Citi a passing grade on its stress test the second time in a row, giving permission to triple its dividend to 16 cents a share and approving an $8.6 billion stock repurchase program,
Citigroup's head office remained at 399 Park Avenue for more than 50 years before 388 Greenwich Street became our headquarters in 2016.
In August 2020, Citi wrongly wired $900 million to one of its clients, the American corporation, Revlon.
In April 2021, Citi announced it would exit its consumer banking operations in 13 markets, including Australia, Bahrain, China, India, Indonesia, South Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand and Vietnam.
In January 2022, Citi further announced its plan to exit consumer banking in Mexico, as well as small-business and middle-market banking operations.
"Citicorp ." International Directory of Company Histories. . Encyclopedia.com. (June 22, 2022). https://www.encyclopedia.com/books/politics-and-business-magazines/citicorp-0
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Citi competitors
| Company name | Founded date | Revenue | Employee size | Job openings |
|---|---|---|---|---|
| Morgan Stanley | 1935 | $3.0B | 68,097 | 1,106 |
| BNY Mellon | 2007 | $16.4B | 48,400 | 1,241 |
| Merrill Lynch | 1914 | $13.8B | 15,100 | - |
| Credit Suisse | 1856 | $3.1B | 47,860 | - |
| Bank of America | 1998 | $85.5B | 200,000 | 5,981 |
| Goldman Sachs | 1869 | $434.4M | 40,500 | 575 |
| HSBC Bank | 1880 | $5.2B | 15,650 | 168 |
| JPMorgan Chase & Co. | 2000 | $2.4B | 255,351 | 12,121 |
| Wells Fargo | 1852 | $2.4B | 268,531 | 2,279 |
| Capital One | 1994 | $26.0B | 51,985 | 6,469 |
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