Citi's Value Proposition:
A Mission of Enabling Growth and Progress
What You Can Expect From Us & What We Expect From Ourselves
Citi's mission is to serve as a trusted partner to our clients by responsibly providing financial services that enable growth and economic progress. Our core activities are safeguarding assets, lending money, making payments and accessing the capital markets on behalf of our clients. We have 200 years of experience helping our clients meet the world's toughest challenges and embrace its greatest opportunities. We are Citi, the global bank - an institution connecting millions of people across hundreds of countries and cities.
We protect people's savings and help them make the purchases - from everyday transactions to buying a home - that improve the quality of their lives. We advise people on how to invest for future needs, such as their children's education and their own retirement, and help them buy securities such as stocks and bonds.
We work with companies to optimize their daily operations, whether they need working capital, to make payroll or export their goods overseas. By lending to companies large and small, we help them grow, creating jobs and real economic value at home and in communities around the world. We provide financing and support to governments at all levels, so they can build sustainable infrastructure, such as housing, transportation, schools and other vital public works.
These capabilities create an obligation to act responsibly, do everything possible to create the best outcomes, and prudently manage risk. If we fall short, we will take decisive action and learn from our experience.
We strive to earn and maintain the public's trust by constantly adhering to the highest ethical standards. We ask our colleagues to ensure that their decisions pass three tests: they are in our clients' interests, create economic value, and are always systemically responsible. When we do these things well, we make a positive financial and social impact in the communities we serve and show what a global bank can do.
Financial Summary
In billions of dollars, except per-share amounts, ratios and direct staff
| 2015 | 2014 | 2013 | |
|---|---|---|---|
| Citicorp Net Revenues | $68.5 | $69.4 | $69.9 |
| Citi Holdings Net Revenues | 7.8 | 7.8 | 6.8 |
| Citigroup Net Revenues | $76.3 | $77.2 | $76.7 |
| Citicorp Net Income | 16.2 | 10.8 | 15.5 |
| Citi Holdings Net (Loss) | 1.0 | (3.5) | (1.9) |
| Citigroup Net Income | $17.2 | $7.3 | $13.7 |
| Diluted EPS - Net Income | 5.40 | 2.20 | 4.34 |
| Diluted EPS - Income from Continuing Operations | 5.42 | 2.20 | 4.25 |
| Citicorp Assets | 1,657 | 1,713 | 1,726 |
| Citi Holdings Assets | 74 | 129 | 154 |
| Citigroup Assets | $1,731 | $1,842 | $1,880 |
| Deposits | 907.9 | 899.3 | 968.3 |
| Citigroup Stockholders' Equity | 221.9 | 210.2 | 204.0 |
| Basel III Ratios - Full Implementation | |||
| Common Equity Tier 1 Capital | 12.1% | 10.6% | 10.6% |
| Tier 1 Capital | 13.5 | 11.5 | 11.2 |
| Total Capital | 15.3 | 12.8 | 12.6 |
| Supplementary Leverage | 7.1 | 5.9 | 5.4 |
| Book Value per Share | $69.46 | $66.05 | $65.12 |
| Common Shares Outstanding (millions) | 2,953.3 | 3,023.9 | 3,029.2 |
| Market Capitalization | $153 | $164 | $158 |
| Direct Staff (thousands) | 231 | 241 | 251 |
Letter to Shareholders
Dear Fellow Shareholders:
2015 was a pivotal year for Citi. It was defined by the tangible progress we made in a sustained effort to transform and reshape Citi into a simpler, smaller, safer and stronger institution - more than it has been at any time since the financial crisis.
- Michael L. CorbatChief Executive Officer
From a net income perspective, the over $17 billion we earned in 2015 made it our best year since 2006. Putting that number in context, we generated strong earnings operating as a smaller company, with a lower headcount, more focused footprint, and dramatically different mix of businesses and assets from what Citi was a decade ago. In just the last three years we have strengthened our core businesses while reducing our headcount by 28,000, assets by over $130 billion, and legal entities by over one-third. We have shrunk our branch network by nearly 30 percent and eliminated 182 operations centers, as part of our effort to establish shared service centers and mine the efficiency opportunities in our business model.
Going into 2015 we set three goals for ourselves: to generate top-line growth, deliver modest positive operating leverage on our core expense base and significantly reduce the drag on earnings due to legal and repositioning costs. Even in a challenging economic environment, we achieved each of those objectives last year.
Our performance was driven by the discipline we applied to managing our core businesses. On a constant dollar basis, we grew our revenues by 3 percent, while keeping our core operating expenses essentially flat, and grew our loans and deposits in our core franchise each by 5 percent. We also reduced the overall size of our balance sheet and took assets in Citi Holdings down by over 40 percent from the prior year period.
After completing the sale of $32 billion of assets, including OneMain Financial and our retail banking and credit card businesses in Japan, we closed out 2015 with just under $75 billion in assets in Holdings, amounting to only 4 percent of our balance sheet. More significantly, Holdings was profitable for 2015. And we are committed to keeping Holdings at least at break-even going forward.
We continued to make progress utilizing our Deferred Tax Assets (DTAs). And with a Common Equity Tier 1 Capital Ratio of 12.1 percent and a Supplementary Leverage Ratio of 7.1 percent, our capital position comfortably exceeded the regulatory thresholds for both ratios on a fully implemented basis.
Our robust capital position was instrumental in achieving a positive result from the Federal Reserve's 2015 Comprehensive Capital Analysis and Review (CCAR). It allowed us to start returning meaningful capital to shareholders. We reduced our outstanding common shares by more than 70 million, increased our dividend and thereby returned nearly $6 billion in capital to shareholders.
Passing CCAR was a meaningful milestone in becoming the Citi we want to be. It also underscored our commitment to sustaining a capital planning process that satisfies the deservedly high expectations placed on an institution of true global reach. In keeping with these expectations, we continued to invest in the compliance, control and regulatory functions critical to maintaining our license to do business.
2015 was also a year when we assessed our progress against a series of goals and financial targets I laid out three years ago, just after I became CEO.
Our first goal was to generate consistent and quality earnings. We did that by focusing and reallocating our finite resources while directing targeted investments to select businesses, product offerings, markets, client and customer segments and infrastructure where we saw a clear pathway to future growth.
Our second goal was to bring Citi Holdings to the breakeven point. We did that, and more. In fact, we surpassed our original goal of driving Holdings to breakeven by keeping Holdings profitable for the year.
Our third goal was to utilize our Deferred Tax Assets (DTAs). We did that by consuming over $7 billion of DTAs over three years, $1.5 billion of that in 2015.
All of these results contributed to our progress towards our most important aspiration: to be known as an indisputably strong and stable institution. The combination of net income, Holdings' strong performance and DTA utilization resulted in the generation of $50 billion in regulatory capital over the past three years. Our goal continues to be not only the generation of capital but also increasing the return of that capital to shareholders.
At roughly the same time that we laid out those broad strategic goals we established three more specific financial targets, which we pledged to do our best to achieve within a three-year time horizon.
Three years later, how did we do?
Our first target was to achieve a Return on Assets (ROA) in a range of 90–110 basis points, and by reaching 94 basis points, we hit it. Our second target was to achieve a Citicorp Efficiency Ratio in the mid-fifties range. At 57 percent, we came close. And we made progress toward meeting our target of achieving a 10 percent Return on Tangible Common Equity (ROTCE). We consider the 9.2 percent return we achieved a respectable result in light of the fact that we only began to return meaningful capital to shareholders after passing CCAR last year. We remain committed to achieving an ROTCE in excess of 10 percent.
Many of our efforts in recent years have been to set us up to focus on the future of our two principal businesses. In 2015 we began to shift our strategic posture from defense to offense in a number of areas, markets and businesses critical for future growth. While we remain in a difficult environment, through our expense discipline we are creating the capacity to make targeted investments in businesses that are well positioned to drive revenue growth.
In our Global Consumer Bank, we continue to focus our footprint by exiting a number of markets where we couldn't see a clear path to achieving a rate of return our investors expect and deserve. We are concentrating our physical presence in high-impact locations in leading urban centers. We are keeping pace not just with our competitors but with our clients and customers by prioritizing the rapid digitization, mobilization and seamless connectivity of basic financial transactions.
We are investing in our U.S. Credit Card business and positioning it for greater and faster growth. A significant sign of the success of that strategy was our announcement that we would be partnering with Visa to be the exclusive issuer of a co-branded credit card available to more than 50 million Costco members. Citi worked with Android Pay, Apple Pay and Samsung Pay to make mobile payment solutions available to U.S. customers and teamed with MasterCard to expand global acceptance of the Citi MasterPass digital wallet.
And we continue to satisfy the desire of many of our customers for a more modern physical retail experience by launching Smart Banking® branches in a number of high-growth urban centers around the world. To accelerate this mobile-first approach, we established a new unit, Citi FinTech, to consolidate and concentrate the efforts we devote to the rapid development of a radically simple, connected mobile banking solution.
In our Institutional Clients Group, we intend to build on our market share gains by continuing to focus on a comparatively smaller number of multi-national corporations, financial institutions, asset managers, hedge funds, private equity firms and public sector entities with sophisticated needs for wholesale banking products and services.
Last year, we also helped facilitate a number of landmark transactions, several of them record-setting. These included First Data Corporation's $2.8 billion initial public offering, a $34 billion acquisition financing package on behalf of Teva Pharmaceutical Industries (the second largest loan of the year), and our longtime client General Electric Company's $36 billion debt exchange offer, the largest transaction of its kind in history.
We are confident that we can continue to grow our Treasury and Trade Solutions business (TTS). Through the world's largest proprietary closed-loop payment network, we provide seamless connectivity to the banking systems in nearly 100 countries, facilitating some $3 trillion worth of financial flows each day in over 135 currencies.
Far from seeing ourselves as a monolithic entity intent on crowding out smaller competitors, we define our role as being "scaled to serve" a specific set of clients who rely on our global network, any of whom would simply take their business to global peers if for any reason we were prevented from meeting their needs.
But we don't just serve big businesses. In addition to being a leading provider of financial services to multinational corporations, last year our small business lending in the U.S. surpassed $10 billion, raising our total lending to the sector over four years to just under $40 billion. We also lent and invested nearly $5 billion in affordable housing projects in the U.S. last year, making us the number one financer in a sector crucial to strengthening communities nationwide.
2015 was also a year when we made progress in our role as one of the world's leading global citizens. Over the last year, we were able to provide many of our stakeholders - customers, clients, nonprofit partners and the communities around the world where we live and work - even more tangible support of our thesis that global institutions are uniquely positioned to help society address global problems on a global scale.
It's not easy to think of a greater or more daunting challenge than climate change. We announced our $100 billion Sustainable Progress initiative, furthering our long-term commitment to lend, invest and facilitate financial solutions to reduce the impact of climate change.
We also are investing in the next generation of leaders. The Citi Foundation's $50 million Pathways to Progress initiative in the U.S. is helping to close the skills gap between young prospective employees and employers by helping them to acquire the workplace and leadership skills critical to competing in a 21st century economy. More than a thousand of my Citi colleagues have donated their time and expertise to the program, which has reached more than 70,000 out of our target of 100,000 young people across ten cities. Buoyed by the resonance of this effort, the Foundation began to expand Pathways to Progress internationally.
Citigroup - Key Capital Metrics
Pathways to Progress is just one of a number of examples I could cite of the various programs we have developed to demonstrate our value to society.
And after spending my entire 32-year working career here at Citi, I'm both proud and convinced that the most important thing a leader can do is to work tirelessly to help create a company and a culture that all of its people - from a diversity of backgrounds, nationalities, cultures, interests and perspectives - are proud to go to work for each day.
Last year, in furtherance of our commitment to advancing a more open and collaborative culture and holding ourselves to the highest possible ethical standards, we launched a refined Mission and Value Proposition. For the first time, all of our people can see on one page a succinct description of what we do every day at the world's global bank. You can read it on the inside cover.
We also rolled out a new set of Leadership Standards, reflecting the first significant update of these important cultural, behavioral and ethical guidelines in five years. The overarching goal driving the roll-out of our new standards was to create a common language around what it means to be a leader at Citi.
2015 Citicorp Net Revenues1
Looking back on our progress and performance, I would have to conclude that 2015 was a year when we saw indisputable evidence that our aspiration of returning Citi to its historic roots as the world's most admired global consumer, commercial and institutional bank is in reach.
We are well positioned to navigate an environment likely to remain challenging, whether those challenges arise from market volatility, revised growth expectations or political risk and uncertainty. We entered 2016 with a strong franchise — a clear strategy, an enviable capital position and a balanced and tightly risk-managed portfolio designed to serve discrete sets of clients.
Perhaps our greatest accomplishment wasn't quantifiable according to any metric that I am aware of. Our ongoing investment of time, energy and focus to be constantly creating (and recreating) a company and a culture that I, and my 230,000 Citi colleagues around the world, are proud to work for every day is what matters most, at the end of the day and also at the end of the year.
While such things are never easy to measure, I believe that the fruits of these efforts will provide lasting contributions to society, our communities and economic growth this year, and in the years to come.
Sincerely,
Michael L. Corbat
Chief Executive Officer, Citigroup Inc.
10th Annual Global Community Day
During the past 10 years, Citi volunteers have participated in more than 11,000 Global Community Day activities and contributed over 2 million hours of service.
Global Community Day offers a wide range of service opportunities that harness the enthusiasm and passion of our diverse employees, with family and friends, to help meet the pressing needs of our communities.
In 2015, to celebrate our 10th annual Global Community Day, more than 80,000 Citi volunteers in 487 cities spanning 93 countries and territories engaged in service activities to benefit their local communities. In the days leading up to and including Global Community Day, Citi colleagues, alumni, clients, family and friends worked side by side on more than 1,200 service projects ranging from urban revitalization to literacy and education, career readiness, environmental conservation and disaster relief.
As part of our efforts to enable progress in cities across the globe, this annual event also highlights the depth of engagement Citi has with its partners to address local issues. For example, many U.S. youth who are part of the Citi Foundation's Pathways to Progress initiative planned and participated in volunteer events in 10 cities where the initiative has been implemented.
Global Consumer Banking
Citi's Global Consumer Bank serves more than 100 million customers1 in the fastest-growing cities in 24 countries worldwide.
The Global Consumer Bank (GCB) operates four geographical business lines - Branded Cards, Retail Services, Retail Banking and Commercial Banking - in Citi's four regions: Asia; Europe, the Middle East and Africa (EMEA); Latin America; and North America. With more than a century of enviable brand and market leadership in markets like the U.S., Mexico and Asia, GCB is competitively well-positioned to grow a high creditquality customer base that benefits most from our global capabilities.
In 2015, GCB delivered meaningful progress on strategic initiatives and set the foundation for growth. We streamlined our product suite and sharpened value propositions to drive new customer acquisition, concentrated our retail presence in top urban centers with our distinctive Smart Banking® model and prioritized the digitization of our business today to reflect the massive shift in transaction activity to digital channels. We also continued to simplify and standardize systems and processes to improve efficiency while accelerating the completion of a uniform technology platform in 2016.
To accelerate speed to market with nextgeneration mobile banking capabilities, we established a new unit called Citi FinTech. This agile unit is charged with designing a mobile banking solution that delivers a radically simple, connected customer experience across the full range of client services: Borrow, Pay, Save, Invest and Protect. In addition to benefiting from Citi's distinct strengths, the team will engage the best capabilities, talent and partners in financial technology (FinTech) to deliver a value proposition in the U.S. in fourth quarter 2016.
Operating approximately 3,000 branches2 in more than 100 top cities worldwide, GCB generated $9.8 billion in pretax earnings, representing 43 percent of Citicorp's total. In 2015, the business held $301 billion in deposits, had $391 billion in average assets and included $281.3 billion in average loans.
Credit Cards
Citi is the world's largest credit card issuer, with more than 138 million accounts, $363.9 billion in annual purchase sales and $133.2 billion in average receivables across Citi Branded Cards and Citi Retail Services.
1This includes Citi Retail Services customers.2This does not include approximately 400 Banco de Chile branches, which are part of a joint venture between Citi and Banco de Chile.
Citi's App for Apple Watch
In March 2015, Citi was the first U.S. bank to launch a banking app designed for the Apple Watch™. The app provides Citi U.S. debit and credit card clients with access to their account balances, recent transactions and real-time notifications of credit cards transactions right on their wrist. The app heralded a radically
new visual and navigation style, based on single-mindedly user-centric design. Citi's digital team brought the app from concept to a ready-to-launch product in just under 120 days, illustrating the Global Consumer Bank's transformation into a nimble, open banking model that can plug into the best skills and ideas. This marked the first time Citi was present at the birth of a new device class from Apple.
Citi Branded Cards
Citi Branded Cards provides payment and credit solutions to consumers and small businesses, with more than 48.2 million accounts globally. In 2015, the business generated annual purchase sales of $283.9 billion and had an average loan portfolio of $89.7 billion.
In 2015, Citi Branded Cards continued to simplify and standardize its global product portfolio, further reducing the number of product variations by 61 percent and rolling out common global product platforms that increase product competitiveness while allowing for local customization. We introduced Citi Simplicity®, a card designed for value-focused customers, in Poland and Russia, and Citi Prestige®, geared to affluent customers, in the Philippines, Taiwan, Thailand and the United Arab Emirates. Citi Prestige now is available in a total of 13 markets representing the majority of our retail banking wealth management customer base.
Citi continues to harness the power of its scale and network to create value for partners and customers. We announced a new, expanded global agreement with MasterCard to speed delivery of payment solutions for customers and drive future payment innovation. Building on our industry-leading rewards capabilities, Citi created a single powerful global rewards platform and website that provide access for customers to redeem rewards from more than 20 global points transfer partners. The program is available in Australia, Bahrain, Colombia, Hong Kong, the Philippines, Singapore, Thailand and the U.S., and new relationships with Qantas Airways and Virgin America will empower customers with even more ways to use rewards.
In the U.S., Citi continued to enhance its proprietary and co-brand portfolio with world-class products and rewards. Costco, one of the largest and most respected retailers, selected Citi to become the exclusive issuer of Costco co-brand credit cards. Citi expanded opportunities to earn rewards faster for everyday purchases made with the ThankYou® Premier card, including gas, parking, tolls and public transportation, and also increased the value of ThankYou Points when redeeming for travel.
Through relationships with legendary artists and bands, Citi's award-winning entertainment access program Citi Private Pass® offered unmatched access and VIP experiences to Citi customers in the U.S. In addition, Citi expanded its entertainment marketing offers globally to more than 10 countries, including Australia, China and the United Kingdom. In the U.S., Citi announced the Citi Concert Series on TODAY, a multi-year sponsorship with NBC that provides year-round opportunities for millions of Citi customers to enjoy watching live performances from some of the biggest names in music.
Wherever and whenever customers choose to make purchases - in store, online or on their mobile devices - Citi offers seamless, convenient and fast payment solutions. Citi worked with Android Pay, Apple Pay and Samsung Pay to make mobile payment solutions available to U.S. Citi customers and teamed with MasterCard to expand global acceptance of the Citi MasterPass digital wallet.
Retail Services
Citi Retail Services is one of North America's largest providers of private label and co-brand credit cards for retailers. In addition, the business delivers multi-channel retailing expertise, advanced data analytics and digital solutions to help premier retailers across an array of industries grow their businesses. We serve 90 million accounts for iconic brands such as Best Buy, ExxonMobil, Macy's, Sears, Shell and The Home Depot.
In 2015, Citi Retail Services renewed six relationships and signed new agreements with America's oldest clothing retailer Brooks Brothers and convenience store retailer Wawa. We converted the Macy's credit card portfolio to Citi's systems, providing enhanced efficiency and effectiveness while facilitating advanced analytics to support sales growth. We also completed the first phase of a multiyear digital transformation initiative to build a single modular credit card marketing and servicing framework supporting the digital and mobile needs of our partners and their customers. Experts say the framework is the most advanced and flexible mass customization structure in the retail private label credit card market.
The business, which marked three decades of industry leadership this year, earned several notable awards, including the Institute of Risk Management's Global Risk Award and an American Business Award for Innovation of the Year for its Field Sales Team Enhancement project.
In 2015, Citi Retail Services saw purchase sales of $80 billion and an average loan portfolio totaling $43 billion.
Citi Bike®
In 2015, Citi Bike® riders in New York took a record 10 million trips, a 23 percent increase over 2014. The multi-year, Citi-funded expansion of the program proceeded on schedule with the introduction of stations in new neighborhoods in Manhattan, Brooklyn and Queens and a 25 percent increase in bikes on the street (to 7,500).
Through Citi Bike for Good, Citi supported three of New York City's most impactful not-forprofit organizations: the American Red Cross, No Kid Hungry® and the YMCA of Greater New York. The initiative put hundreds of specially branded bicycles on the streets, and through it, Citi contributed $50,000 to each of the organizations. Citi Bike also launched in Jersey City, New Jersey, and continued to grow in Miami.
Retail Banking
Citibank meets the full range of consumer banking needs, including checking and savings accounts, loans, wealth management advice and small business services. Our Smart Banking branch design and experience, tailored offerings and world-class service continue to set us apart from peers.
Through Citigold® and Citigold Private Client, Citi provides industry-leading, personalized wealth management services and a host of top-tier benefits to clients around the globe. In 2015, Citi opened its first Citigold Client Centers in the U.S. and Colombia, replicating the successful model in place throughout Asia. After its successful introduction in Latin America and EMEA last year, Citi Priority, a unique value proposition designed to meet the needs of the emerging affluent, launched in Hong Kong.
To provide Citi's global financial advisors with premier business and executive training, Citi joined with The Wharton School of the University of Pennsylvania to form the Citi® Wharton® Global Wealth Institute. Part of a three-year executive education initiative, the new institute will benefit the Citigold, Citigold Private Client and Banamex global advisory network.
As Citi expands and enhances its digital capabilities, we also continued to refine our physical footprint, concentrating Smart Banking branches in high-impact locations in fast-growing cities around the world, including Dubai, Jakarta, Los Angeles, Moscow, New York and Quezon City. Smart Banking continues to drive growth in client acquisition, improved satisfaction, and increases in speed of in-branch servicing, sales and brand recognition.
Always looking for innovative ways to improve all aspects of the client experience, Citi continues to test and enhance digital features. In 2015, Citi Handlowy was the first bank in Poland to introduce multi-currency ATMs. Citi introduced Touch ID to its U.S. mobile banking app for iPhone, allowing customers to log in with a mere touch to access a suite of new features, including easier mobile bill pay and check deposit. At the Citi Innovation Lab in New York, Citi initiated testing of a screenless, cardless ATM that uses iris-scan biometric technology for authentication and would enable customers to conduct transactions on their smartphones before visiting the ATM.
"The bank has begun a rollout of a futuristic 'smart branch' model in Manhattan that jettisons the usual branch features in favor of digital services that are more in keeping with the atmosphere of an Apple Store." - New York Times, November 13, 2015
Across the U.S., Citi continues to support the growth of small businesses. After lending $9.2 billion to U.S. small businesses in 2014, more than double that of 2009, Citi increased lending even more in 2015. Over $10 billion in loans were originated in 2015, raising the total amount of U.S. small business lending over the past five years to $46 billion.
The Mortgage business, which provides loans for home purchase and refinance transactions in the U.S., originated $29.5 billion in new loans in 2015. The business continued to focus on client relationships by targeting originations within Citibank's U.S. retail bank footprint, leveraging digital channels, and implementing an enhanced fulfillment process to reduce cycle times and improve the client experience. As part of its ongoing commitment to foreclosure prevention, CitiMortgage conducted its fifth consecutive Road to Recovery Tour, a series of events offering in-person meetings for clients whose financial difficulties affect their ability to make mortgage payments.
Commercial Banking
Citi Commercial Banking provides global banking capabilities and services to mid-sized, trade-oriented companies in more than 100 cities worldwide. As many of these clients expand internationally, Citi helps enable their growth and ability to access capital across multiple countries. In 2015, lending turnaround time improved significantly and client satisfaction reached an all-time high. Citi also became the first large bank awarded Preferred Lender Program status by the Small Business Administration for the Export Working Capital Program, geared toward borrowers that are exporting goods and services and creating U.S. jobs.
Delivering the Citigold Promise in Manhattan
By leveraging innovative technologies and unlocking the power of relationship banking, the opening of the Citigold Client Center at 5th Avenue and 52nd Street in Manhattan marks the opening of a new chapter in how Citi serves clients. It is the first Citigold Client Center in the U.S. and is the physical embodiment of the Citigold value proposition. Citi pioneered this model in Asia with great success and is bringing it to the U.S. with substantial physical investments.
New technology solutions at the branch enable our bankers and advisors to meet clients' current needs as well as proactively identify and deliver the solutions that will fit their lives for the future. Our Citigold Relationship Associates are at the forefront of delivering this differentiated experience to our clients in an advisory relationship. This location boasts one of our finest branch teams - equipped with tablets, new online terminals and Citi's first teller cash recycler in the U.S. — to help customers conduct a wide range of transactions digitally and seamlessly.
Upstairs, the Citigold lounge provides clients with meeting space, free access to Wi-Fi and use of tablets. Whether there to take care of business needs, hold an international video conference or just relax during a busy day, this has become a sought-after destination for clients from New York, elsewhere in the U.S. and around the world.
Institutional Clients Group
Through Citi's network of more than 100 countries, Citi's Institutional Clients Group helps multinational companies grow, hire, and deliver products and services. Citi also provides financing and support to governments at all levels to help them not only conduct day-today operations but also to build sustainable infrastructure, housing, transportation, schools and other vital public works for the future.
Our geographic breadth and product depth help provide institutional investors access to global and local markets. Over the past two centuries, Citi has financed some of the world's most transformative projects, and every day - through lending, cash management, advisory services and much more - we continue to support innovation and growth around the globe.
With trading floors in more than 80 countries, clearing and custody networks in over 60 countries and connections with 400 clearing systems, Citi maintains one of the largest global financial infrastructures and facilitates, on average, over $3 trillion of flows daily. This is what enables Citi to serve its core clients with distinction.
Capital Markets Origination
Citi's Capital Markets Origination business is focused on the capital-raising needs of our institutional clients, from inaugural issuances and exchanges to cross-border transactions and first-oftheir-kind landmark structures. Owing to our unmatched global footprint and diverse range of financial products, Citi aims to be the first choice among issuers for clients' underwriting needs. Citi's track record of successfully executing in both buoyant and challenging market conditions is a testament to our unwavering commitment to provide the highest quality service to clients. Citi's structuring and execution expertise has established the firm as a leader in the equity capital markets, whether measured by innovation or proceeds raised, and has distinguished Citi as the clear choice for debt underwriting, with excellence across a broad range of currencies and markets.
In 2015, Citi was underwriter for several landmark transactions, including joint bookrunner on First Data Corporation's $2.8 billion initial public offering; joint bookrunner, underwriter and mandated lead arranger on a $34 billion acquisition financing package for Teva Pharmaceutical Industries, the second largest loan globally in 2015; and lead dealer manager for General Electric Company on a $36 billion debt exchange offer, the largest corporate debt exchange in history.
Corporate and Investment Banking
Citi's Corporate and Investment Banking franchises provide comprehensive relationship coverage service to ensure the best possible service and responsiveness to clients. With its strong presence in many nations, Citi uses country, sector and product expertise to deliver our global capabilities to clients wherever they choose to compete.
Citi's Corporate and Investment Banking client teams are organized by industry and by country. Each team is composed of two parts: Strategic Coverage Officers focus on mergers and acquisitions and equity and related financing solutions, while Corporate Bankers - in partnership with Citi's Capital Markets specialists and with support from the Global Subsidiaries Group - deliver corporate banking and finance services to global, regional and local clients.
In 2015, Citi played an integral role on several transformational transactions, including sole financial advisor to Danaher Corporation on its agreement to acquire Pall Corporation for approximately $13.8 billion; and advisor to GE Capital on the sale of its U.S. Sponsor Finance business to Canada Pension Plan Investment Board for more than $11 billion, the sale of its Healthcare Financial Services U.S. lending business to Capital One for approximately $9 billion, the sale of its European Acquisition Finance business - representing aggregate ending net investment (ENI) of approximately $2.2 billion - to Sumitomo Mitsui Banking Corporation, and the sale of its equipment lending and leasing business in Mexico (representing ENI of approximately $1.1 billion) to Linzor Capital Partners. Citi also served as a financial advisor to Baxter International on the spin-off of its $20 billion biopharmaceuticals business, Baxalta. The spin-off created two separate global health care companies: Baxter, which will focus on lifesaving medical products; and Baxalta, which will focus on developing and marketing innovative biopharmaceuticals.
Markets and Securities Services
Citi's Markets and Securities Services business provides world-class financial products and services as diverse as the needs of the thousands of corporations, institutions, governments and investors that Citi serves. Citi works to enrich the relationships, products and technology that define its market-making presence. The breadth, depth and strength of Citi's sales and trading, distribution and research capabilities span a broad range of asset classes, currencies, sectors and products, including equities, commodities, credit, futures, foreign exchange (FX), emerging markets, G10 rates, municipals, prime finance and securitized markets. Our Investor Services and Direct Custody and Clearing businesses provide customized solutions that support the diverse investment and transaction strategies of investors and intermediaries worldwide.
The Citi VelocitySM platform delivers electronic access to Citi's global footprint and real-time information, giving clients unprecedented access to capital markets intelligence and services across all product lines. Through web, mobile and trading applications, clients can find Citi research, commentary, and proprietary data and analytics; execute fast, seamless and stable foreign exchange and rates trades; and utilize Citi's suite of sophisticated, post-trade analysis tools.
Private Banking
Citi operates one of the world's leading global private banks, whose teamwork, commitment to service, and ability to see and seize opportunities for clients set it apart. Our 800 private bankers and product specialists, located in 51 offices in 16 countries, act as trusted advisors to many of the world's most successful and influential individuals and families.
Citi's comprehensive services are tailored to individuals and families, including entrepreneurs and business owners, single- and multi-family offices, senior corporate executives, nextgeneration/inherited wealth, law firms and attorneys. Through banking and cash management to lending, investment strategies, and trust and wealth advisory services, Citi's goal is to deliver expertise and a premier level of service while helping grow, manage and preserve wealth. As Citi partners with clients, it can provide global thinking informed by deep local insight and can help deliver the complete financial management strategies that today's wealth requires.
Treasury and Trade Solutions
Citi's Treasury and Trade Solutions(TTS) business provides integrated cash management and trade finance services to multinational corporations, financial institutions and public sector organizations across the globe. With the industry's most comprehensive suite of digital-enabled platforms, tools and analytics, TTS leads the way in delivering innovative and tailored solutions to our clients. Offerings include payments, receivables, liquidity management and investment services, working capital solutions, commercial card programs and trade finance.
Based on the belief that client experience is the driver of sustainable differentiation, TTS has focused its efforts on transforming its business to deliver a seamless, end-to-end client experience through the development of its capabilities, client advocacy, network management and service delivery across the entire organization. New client mandates cemented Citi's position as leading provider for multinational corporations seeking full-scale regional cash management solutions across regions and globally. Shell appointed Citi TTS as its sole bank provider for cash management services across 16 countries in Europe. Samsung Electronics selected Citi to implement a global renminbi (RMB) netting solution, conducting the world's first intercompany cross-border netting transaction using RMB.
Following the successful launch of the same service in the U.S., Citi® Payment Exchange was introduced in Canada. Payment Exchange is an integrated and highly flexible institutional paymentprocessing solution used in making payments to suppliers and third parties.
In strong validation of the strength of its value proposition, CitiDirect BE® and CitiConnect®, TTS' digital banking channels that support over half a million active users in 26 languages, were recognized with industry awards. These included the 2015 Celent Model Bank award for innovation, effective use of technology and integration excellence for the CitiConnect ERP Integrator and the prestigious Best Mobile Service or App for Enterprise by Mobile World Congress for CitiDirect BE Mobile. Citi was the first bank to win in a category dominated by FinTechs.
2015 Highlights
- The Banker named Citi Best Global Transaction Bank, recognizing our unparalleled global connectivity and the value we are creating through the execution of a client-focused strategy. Noting that "Citi stands at the forefront of transaction banking," The Banker called out Citi's focus in three major areas: improving client experience, innovation and digitization and investing in new technologies such as cybersecurity and digital money, which have helped Citi to create true client partnerships, moving away from a product push to a solution consultation.
- Recognizing Citi's efforts to become a simpler, smaller, safer and stronger bank while maintaining a truly global presence, Euromoney named Citi the Best Global Bank, Best Global Emerging Market Investment Bank and Top Bank in Foreign Exchange in 2015. Euromoney noted that, "Citi is a much-changed, smaller, more focused institution. But it still has a truly global presence, in both consumer and wholesale banking, which competitors will struggle to replicate" and that "Citi's management has taken many of the necessary steps to ensure that a global universal banking model works. Our belief is that its clients and its shareholders will increasingly see the benefits of its unique global franchise."
- Global Finance named Citi Best Overall Global Digital Bank, which recognized our continued success in the execution of our digital strategy, which is characterized by innovation and client experience and evidenced by our award-winning transaction services channels: CitiDirect BE® and CitiConnect®. Citi was also included in Global Finance's The Innovator 2015 listing of global firms that are engendering innovation in treasury and transaction processing. Citi's Treasury and Trade Solutions business was also named Global Trade Review's Best Global Trade Finance Banks and Best Global Supply Chain Finance Bank.
- As a testament to Citi's commitment to provide clients with a consistent, full-service product offering in more than 100 countries, International Financing Review (IFR) named Citi the top Global Emerging Markets Bond House and Global Loan House. IFR and Risk Magazine both named Citi the top Global Derivatives House and Global Credit Derivatives House. IFR cited Citi for "taking advantage of being ahead of the curve, and cementing its position as a global full-service provider" amid increasing regulatory pressures that are causing banks to restructure their businesses. IFR also noted Citi's "solid shape" and "superior capital position" as new regulations kicked in during 2015.
- Following a steady improvement in performance over the past several years, Citi secured Greenwich Associates' #1 ranking in Global Fixed Income Market Share, following a survey that polled 4,000 fixed income investors around the world.
- According to the survey, Citi increased its fixed income market share by 60 basis points to 10.2 percent in 2015 and now holds a significant lead over the next closest competitors. Citi has also gained more market share than any other large dealer since 2008 and ranked #1 in both Sales Quality and Trading Quality, as well as #1 in e-Trading, according to the survey.
- PWM/The Banker named Citi Best Private Bank for Customer Service, an accolade that demonstrated Citi's continued commitment to helping our clients build, protect and preserve their wealth legacy through tailored advice. Family Wealth Report also recognized Citi as having the Best Private Client Investment Platform.
Citizenship
Citi is focused on enabling progress in the communities in which we work and live. Together with companies, governments and institutions of all shapes, sizes, scale and scope, we lend, facilitate and invest in products and services that power the global economy. We also recognize that we can play an important role in working with others to address key social and economic challenges facing clients and communities.
We remain committed to deploying the resources of Citi and the Citi Foundation to catalyze innovative solutions and positive measurable outcomes. Issues core to Citi's citizenship efforts include:
Sustainable Progress
Citi continues to advance our goal to lend, facilitate and invest $100 billion in environmental and climate change solutions over the next 10 years. In 2015, we increased our momentum toward meeting this goal and engaged in a record number of transactions with our clients. These new efforts build on a previous goal made in 2007 to direct $50 billion to climate-friendly projects over 10 years, which we met three years early in 2013.
These efforts are part of our Sustainable Progress strategy that includes environmental and social risk management and sustainability goals for Citi's own businesses and operations.
Citi has established new environmental footprint goals for 2020, including 35 percent reduction in greenhouse gas (GHG) emissions, 30 percent reduction in energy and water use, and 60 percent reduction in waste, all against a 2005 baseline. We also used a science-based approach to set a longer-term 2050 GHG emissions reduction goal of 80 percent and plan to seek LEED Platinum certification for our global headquarters at 388 Greenwich Street in New York City.
Environmental and social risk management remains a key priority and policy, and standards will continually evolve in response to emerging risks and new product development.
Citi for Cities
Around the world, local governments are looking for partners to address entrenched challenges to urban progress and help them provide tools and solutions to connect citizens to services. Through supporting modern infrastructure, stimulating local economies, enabling public services to run smoothly and efficiently, and supporting residents to attain financial success, Citi is working to build economically vibrant and inclusive cities and communities.
Citi increased small business lending in the U.S. to more than $10 billion in 2015, raising lending over the last four years to nearly $38 billion. We financed more affordable housing than ever, providing $4.8 billion in financing in 2015.
We are in our second year of our threeyear, $50 million Pathways to Progress initiative to provide 100,000 low-income young people with opportunities to develop workplace and leadership skills critical to competing in a 21st century economy. With the active support of more than 1,000 Citi volunteers to date, 70,000 young people across 10 U.S. cities already have benefited from the program. In 2015, Pathways to Progress expanded globally with the launch of new research connecting the future competitiveness of 35 global cities and investments made to help youth foster the skills and networks needed to succeed.
Citi continues to expand Cities for Citizenship, a program originally launched in 2014 with the mayors of Chicago, Los Angeles and New York that empowers immigrants eligible for citizenship with access to financial and legal assistance in 20 U.S. cities. The program now includes 20 members and has assisted more than 6,000 individuals nationwide in their pursuit of citizenship.
Globally, our partnership with the U.S. government's Overseas Private Investment Corporation has resulted in over $400 million in financing to 44 microfinance institutions in 25 countries, reaching more than 1.2 million entrepreneurs, 92 percent of whom are women.
Talent and Diversity
As a global bank, Citi needs a workforce as diverse as the clients and communities we serve. A diverse workforce stimulates new ideas and fresh ways of thinking and fosters the skills needed to be successful in a dynamic business environment. It also helps us attract the best talent in the industry.
We are proud of our culture of inclusion and collaboration. Citi earned a perfect score on the Human Rights Campaign Foundation's Corporate Equality Index for the 12th year in a row.
To learn more about Citizenship at Citi, visit http://citizenship.citigroup.com.
Sustainable Progress: $100 Billion Environmental Finance Goal
Business activity, such as renewable energy banking and finance and commodity hedging, counts toward our $100 billion environmental finance goal to lend, facilitate and invest $100 billion toward activities that reduce the impacts of climate change and create environmental solutions that benefit people and communities.
In 2015, Citi provided construction financing, tax equity and the commodity hedge to affiliates of Alterra Power Corp. and Starwood Energy Group Global, LLC to finance the Shannon Wind Project (wind turbine pictured below), a 204-megawatt wind facility located in Clay County, Texas.
Citi and other banks provided the $287 million construction loan facility for the project, which consists of a $212 million loan and $75 million in various letters of credit. Subsidiaries of Citi and BHE Renewables provided $219 million of tax equity financing for the project, proceeds of which were used primarily to retire the project's $287 million construction loan facility.
Under a long-term power purchase agreement between Citi and Facebook, the project will provide 100 percent of the power for the foreseeable future for Facebook's newest data center in Fort Worth, Texas.
Citi has been named to the Dow Jones Sustainability and FTSE4Good indices, which have tracked globally recognized corporate responsibility standards every year since 2001 and 2002, respectively. Citi is included in the leadership indices for disclosure and climate performance in the CDP Global Climate Change Report 2015.
ELECTRICITY IS POWERING PROGRESS.
More than half of Ghana's 25 million people live in rural areas, most without access to electricity. It's a problem that affects families on a daily basis and limits their access to quality health care, education and jobs.
The Government of Ghana devised a plan to bring electricity to over 500 remote towns. Citi's long-standing pan-African presence allowed us to work with government leaders to provide long-term financing for this project. The result is better hospitals, schools and opportunities for the Ghanaian people.
For over 200 years, Citi's job has been to believe in people and help make their ideas a reality.
Stockholder Information
Citigroup common stock is listed on the NYSE under the ticker symbol "C" and on the Tokyo Stock Exchange and the Mexico Stock Exchange. Citigroup preferred stock Series AA, C, J, K, L and S are also listed on the NYSE.
Because Citigroup's common stock is listed on the NYSE, the Chief Executive Officer is required to make an annual certification to the NYSE stating that he was not aware of any violation by Citigroup of the corporate governance listing standards of the NYSE. The annual certification to that effect was made to the NYSE on May 20, 2015.
As of January 31, 2016, Citigroup had approximately 81,805 common stockholders of record. This figure does not represent the actual number of beneficial owners of common stock because shares are frequently held in "street name" by securities dealers and others for the benefit of individual owners who may vote the shares.
Transfer Agent
Stockholder address changes and inquiries regarding stock transfers, dividend replacement, 1099-DIV reporting and lost securities for common and preferred stock should be directed to:
Computershare
P.O. Box 43078
Providence, RI 02940-3078
Telephone No. 781 575 4555
Toll-free No. 888 250 3985
E-mail address: shareholder@computershare.com
Web address: www.computershare.com/investor
Exchange Agent
Holders of Golden State Bancorp, Associates First Capital Corporation, Citicorp or Salomon Inc. common stock should arrange to exchange their certificates by contacting:
Computershare
P.O. Box 43078
Providence, RI 02940-3078
Telephone No. 781 575 4555
Toll-free No. 888 250 3985
E-mail address: shareholder@computershare.com
Web address: www.computershare.com/investor
On May 9, 2011, Citi effected a 1-for-10 reverse stock split. All Citi common stock certificates issued prior to that date must be exchanged for new certificates by contacting Computershare at the address noted above.
Citi's 2015 Form 10-K filed with the SEC, as well as other annual and quarterly reports, are available from Citi Document Services toll free at 877 936 2737 (outside the United States at 716 730 8055), by e-mailing a request to docserve@citi.com or by writing to:
Citi Document Services
540 Crosspoint Parkway
Getzville, NY 14068
Stockholder Inquiries
Information about Citi, including quarterly earnings releases and filings with the U.S. Securities and Exchange Commission, can be accessed via its website at www.citigroup.com. Stockholder inquiries can also be directed by e-mail to shareholderrelations@citi.com.
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Cover photograph — A rendering of 388 Greenwich Street in New York City, which is now Citi’s Global Headquarters and undergoing a renovation.