CORPORATE AND INVESTMENT BANKING for Citigroup (C)

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C » Topics » CORPORATE AND INVESTMENT BANKING

This excerpt taken from the C 10-Q filed May 5, 2006.

CORPORATE AND INVESTMENT BANKING


		*Excludes Other Corporate and Investment Banking loss of $12 million.		*Excludes Other Corporate and Investment Banking loss of $12 million.

Corporate and Investment Banking (CIB) provides corporations, governments, institutions and investors in approximately 100 countries with a broad range of financial products and services. CIB includes Capital Markets and Banking, Transaction Services and Other CIB.

		First Quarter						% Change
In millions of dollars		First Quarter						% Change
In millions of dollars		2006			2005			1Q06 vs. 1Q05
Revenues, net of interest expense, by region:
	U.S.	$	2,923		$	2,779		5	%
	Mexico		186			159		17
	Latin America		446			310		44
	EMEA		2,296			1,694		36
	Japan		296			180		64
	Asia		1,132			915		24

Revenues, net of interest expense		$	7,279		$	6,037		21	%
Operating expenses			4,757			3,668		30
Provision for credit losses			—			(56	)	100

Income before taxes and minority interest			2,522			2,425		4	%
Income taxes			574			735		(22	)
Minority interest, net of taxes			19			11		73

Net income		$	1,929		$	1,679		15	%

Net income by region:
	U.S.	$	515		$	893		(42	)%
	Mexico		78			83		(6	)
	Latin America		202			145		39
	EMEA		635			188		NM
	Japan		85			48		77
	Asia		414			322		29

Net income		$	1,929		$	1,679		15	%

Average risk capital(1)		$	20,593		$	20,779		(1	)%
Return on risk capital(1)			38	%		33	%
Return on invested capital(1)			28	%		24	%

(1): See footnote 3 to the table on page 4.
NM: Not meaningful.

This excerpt taken from the C 8-K filed Jan 20, 2006.

CORPORATE AND INVESTMENT BANKING

	Fourth Quarter Revenues						Fourth Quarter Net Income
	Fourth Quarter Revenues				% Change		Fourth Quarter Net Income				% Change
(In Millions of Dollars)	2005		2004		% Change		2005		2004		% Change
Capital Markets and Banking	$	4,919	$	4,347	13	%	$	1,421	$	1,257	13	%
Transaction Services		1,317		1,104	19			275		262	5
Other(1)		—		14	(100	)		351		168	NM

Corporate and Investment Banking	$	6,236	$	5,465	14	%	$	2,047	$	1,687	21	%

(1)

Includes a $600 million pre-tax, $375 million after-tax, release of WorldCom/Research litigation reserves.

•

Capital Markets and Banking

—: Fixed income markets revenues decreased 9%, reflecting lower results in commodities and structured corporate finance.
—: Equity markets revenues increased 39%, driven by improved performance and growth in cash trading, derivatives, and structured products.
—: Investment banking revenues increased 3%, as record advisory revenues, up 25%, were offset by a decline in debt and equity underwriting.
—: Lending revenues increased 31%, driven by hedging gains in credit derivatives.
—: Results include a $386 million pre-tax gain on the sale of Nikko Cordial shares, and a $160 million pre-tax charge to increase reserves for previously disclosed legal matters.
—: Credit costs increased $105 million, due to a $79 million pre-tax charge to increase loan loss reserves and the absence of a $131 million pre-tax loan loss reserve release recorded in the fourth quarter of 2004, partially offset by increased credit recoveries. The increase in loan loss reserves reflected growth in unfunded commitments and direct outstandings.

•

Transaction Services

—: Record revenues, up 19%, were driven by higher customer volumes, reflecting increased liability balances held on behalf of customers, up 12%, assets under custody, up 9%, and the positive impact of rising short-term interest rates.
—: Expenses increased 18%, primarily due to the impact of new acquisitions, investment in organic growth opportunities and an increase in new business volumes.
—: Credit costs increased $43 million, reflecting the absence of a $19 million pre-tax loan loss reserve release recorded in the fourth quarter of 2004.

These excerpts taken from the C 10-Q filed Nov 4, 2005.

CORPORATE AND INVESTMENT BANKING

Corporate and Investment Banking (CIB) provides corporations, governments, institutions and investors in approximately 100 countries with a broad range of financial products and services. CIB includes Capital Markets and Banking, Transaction Services and Other Corporate.

Capital Markets and Banking offers a wide array of investment banking and commercial banking services and products, including the underwriting and distribution of fixed income and equity securities for U.S. and multinational corporations and for state, local and other governmental and government-sponsored authorities. In addition, Capital Markets and Banking also provides capital raising, advisory, research and other brokerage services to its customers, acts as a market-maker and executes securities and commodities futures brokerage transactions on all major U.S. and international exchanges on behalf of customers and for its own account. Capital Markets and Banking is a major participant in foreign exchange markets and in the over-the-counter (OTC) market for derivative instruments involving a wide range of products, including interest rate, equity and currency swaps, caps and floors, options, warrants and other derivative products. It creates and sells various types of structured securities, as well as provides traditional bank lending products to its clientele.

Transaction Services is comprised of Cash Management, Trade Services and Global Securities Services (GSS). Cash Management and Trade Services provide comprehensive cash management and trade finance for corporations and financial institutions worldwide. GSS provides custody and fund services to investors such as insurance companies and pension funds, clearing services to intermediaries such as broker/dealers and depository and agency/trust services to multinational corporations and governments globally.

CORPORATE AND INVESTMENT BANKING

	Three Months Ended September 30,								Nine Months Ended September 30,
In millions of dollars	Three Months Ended September 30,						% Change		Nine Months Ended September 30,						% Change
In millions of dollars	2005			2004			% Change		2005			2004			% Change
Revenues, net of interest expense	$	6,434		$	4,780		35	%	$	17,627		$	16,321		8	%
Operating expenses		3,856			3,055		26			10,892			17,224		(37	)
Provision for credit losses		43			(405	)	NM			(27	)		(812	)	97

Income before taxes and minority interest	$	2,535		$	2,130		19	%	$	6,792		$	(91	)	NM
Income taxes		704			634		11			1,859			(526	)	NM
Minority interest, net of tax		34			44		(23	)		55			80		(31	)

Net income	$	1,797		$	1,452		24	%	$	4,848		$	355		NM

Average Risk Capital(1)	$	21,383		$	20,543		4	%	$	21,087		$	18,546		14	%
Return on Risk Capital(1)		33	%		28	%				31	%		3	%
Return on Invested Capital(1)		25	%		21	%				23	%		2	%

(1): See Footnote (5) to the table on page 6 and discussion of Risk Capital on page 42.
NM: Not meaningful

CIB reported net income of $1.797 billion and $4.848 billion in the 2005 third quarter and nine months, an increase of $345 million and $4.493 billion from the 2004 third quarter and nine months, respectively. Other Corporate in the 2004 nine months reflects the $4.95 billion after-tax WorldCom and Litigation Reserve Charge, partially offset by a $378 million after-tax gain on the sale of Samba. Capital Markets and Banking increased $265 million in the 2005 third quarter and decreased $232 million in the 2005 nine months. Transaction Services increased $41 million in the 2005 third quarter and increased $77 million in the 2005 nine months.

Capital Markets and Banking net income of $1.424 billion in the 2005 third quarter increased $265 million, or 23%, from the 2004 third quarter, while net income of $3.906 billion in the 2005 nine months decreased $232 million, or 6%, from the 2004 nine months. Fixed Income Markets revenues in the 2005 periods increased, driven by strong performance in interest rate products, foreign exchange and commodities. Equity Markets revenues increased in the 2005 periods, driven by improved performance and growth in cash trading, alternative execution and derivatives products. Investment Banking revenues increased in the 2005 periods, driven by an increase in advisory fees, which reflected strong growth in completed M&A transactions, and growth in equity underwriting. Capital Markets and Banking net income in the 2005 periods was reduced by an increased provision for credit losses in the 2005 third quarter and nine months, versus loan loss reserve releases in the 2004 periods.

Transaction Services net income of $327 million and $860 million in the 2005 third quarter and nine months increased $41 million, or 14%, from the 2004 third quarter and $77 million, or 10%, from the 2004 nine months, respectively. The increases in net income in 2005 were primarily due to higher revenues reflecting growth in assets under custody and liability balances, and the positive impact of rising short-term interest rates, partially offset by higher expenses. Results also include a $26 million tax benefit from provisions of the Homeland Investment Act.

The businesses of CIB are significantly affected by the levels of activity in the global capital markets which, in turn, are influenced by macroeconomic and political policies and developments, among other factors, in approximately 100 countries in which the businesses operate. Global economic and market events can have both positive and negative effects on the revenue performance of the businesses and can affect credit performance. This statement is a forward-looking statement within the meaning of the Private Securities Litigation Reform Act. See "Forward-Looking Statements" on page 68.

This excerpt taken from the C 8-K filed Sep 9, 2005.

CORPORATE AND INVESTMENT BANKING

In millions of dollars	2004			2003			2002
Revenues, net of interest expense	$	21,786		$	20,032		$	19,174
Operating expenses	20,530			11,460			12,099
Provision for credit losses	(975		)	732			2,255
Income before taxes and minority interest	2,231			7,840			4,820
Income taxes	96			2,429			1,621
Minority interest, after-tax	93			37			25
Net income	$	2,042		$	5,374		$	3,174

Average risk capital (1)	$	19,047		$	16,266
Return on risk capital (1)	11		%	33		%
Return on invested capital (1)	8		%	25		%

(1) See Footnote (7) to the table on page 3.

This excerpt taken from the C 10-Q filed Aug 4, 2005.

CORPORATE AND INVESTMENT BANKING

Capital Markets and Banking offers a wide array of investment banking and commercial banking services and products, including the underwriting and distribution of fixed income and equity securities for U.S. and multinational corporations and for state, local and other governmental and government-sponsored authorities. In addition, Capital Markets and Banking also provides capital raising, advisory, research and other brokerage services to its customers, acts as a market- maker and executes securities and commodities futures brokerage transactions on all major U.S. and international exchanges on behalf of customers and for its own account. Capital Markets and Banking is a major participant in foreign exchange and in the over-the-counter (OTC) market for derivative instruments involving a wide range of products, including interest rate, equity and currency swaps, caps and floors, options, warrants and other derivative products. It creates and sells various types of structured securities, as well as provides traditional bank lending products to its clientele.

This excerpt taken from the C 8-K filed Jun 7, 2005.

CORPORATE AND INVESTMENT BANKING

In millions of dollars	2004			2003			2002
Revenues, net of interest expense	$	21,774		$	20,021		$	19,165
Operating expenses	20,525			11,455			12,093
Provision for credit losses	(975		)	732			2,255
Income before taxes and minority interest	2,224			7,834			4,817
Income taxes	93			2,426			1,620
Minority interest, after-tax	93			37			25
Net income	$	2,038		$	5,371		$	3,172

Average risk capital (1)	$	19,045		$	16,264
Return on risk capital (1)	11		%	33		%
Return on invested capital (1)	8		%	25		%

(1) See Footnote (7) to the table on page 3.

EXCERPTS ON THIS PAGE:

10-Q	May 5, 2006

8-K	Jan 20, 2006

10-Q (2 sections)	Nov 4, 2005

8-K	Sep 9, 2005

10-Q	Aug 4, 2005

8-K	Jun 7, 2005

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