Citigroup (C)

INTERNATIONAL CONSUMER OUTLOOK

International Consumer is diversified across a number of geographies, product groups, and customer segments. In 2008, International Consumer expects to drive growth in loans, deposits and investment product sales from expanding its customer base through organic growth, investments in expanding the branch network, and the benefit from 2007 acquisitions. As a result, International Consumer expects earnings growth in 2008.

Revenues and credit costs are expected to be affected by global economic conditions, including the level of interest rates, the credit environment, unemployment rates, and political and regulatory developments in the U.S. and around the world.

The International Consumer business could be negatively affected by the “Economic Environment” discussed on page 5.

The Japan Consumer Finance business environment is expected to remain difficult. The impact of changes to consumer lending laws enacted in 2006 as well as deteriorating consumer credit conditions are expected to drive credit costs higher in the Japan Consumer Finance business. The Company will continue to actively monitor developments in customer refund claims and defaults, political developments and the way courts view grey zone claims, refunds and defaults. The Company continues to evaluate the positioning and prospects of the business as the environment changes.

In addition to Japan Consumer Finance, increased credit costs are expected across all international businesses as their growing portfolios season or mature, and are expected to be affected by economic and credit conditions in the U.S. and around the world.

INTERNATIONAL CONSUMER OUTLOOK

Certain of the statements below are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. See “Forward-Looking Statements” on page 97.

International Consumer is diversified across a number of geographies, product groups, and customer segments and monitors the economic situation in all of the countries in which it operates. In 2007, International Consumer will continue to invest to build on the competitive advantages of its existing global network of branches, offices and sales professionals. The business expects earnings growth from expanding its customer base through organic growth, investments in expanding the branch network, and the benefit from strategic investments and 2006 acquisitions, as well as the recently announced acquisition of Egg. The Egg acquisition when combined with the U.K. Consumer operations will create a broad-spectrum consumer financial services provider. These key variables are expected to drive growth in loans, deposits and investment product sales. The businesses will also focus on tight expense control, productivity improvements and effective credit management. Revenues and credit costs will be affected by global economic conditions, including the level of interest rates, the credit environment, unemployment rates, and political and regulatory developments around the world. International economies are expected to be stable, with an improvement in economic activity expected in Western Europe and many Asian nations.

International Cards — In 2007, continued investment in customer acquisition in both new and existing markets is expected to drive increased purchase sales and loan volumes. Credit costs are expected to show some deterioration as the growing portfolio seasons, while the underlying credit environment is forecast to remain stable.

International Consumer Finance — In 2007, investment in new branches and sales professionals will continue in key expansion markets. In Japan, the impact of the changes to consumer lending laws enacted in 2006 will continue to affect the operating environment. The repositioning of the Japan business is consistent with the Company’s efforts to establish a lower-cost platform and will enable it to compete more effectively in the new interest rate environment. The business expects to break even during 2007. Excluding  Japan, organic growth in existing branches, coupled with new branch openings, is expected to drive revenue and earnings growth. Offerings of new loan products and services in new markets will continue, and gains in market share across several key international regions are forecast. The credit environment in Japan will be impacted by the changes enacted in 2006. Outside of Japan, credit costs are expected to increase slightly, in line with the growing portfolio.

International Retail Banking — In 2007, the business will continue to invest in branch expansion and build on a strong presence in several key

International Consumer Outlook

        Certain of the statements below are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. See "Forward-Looking Statements" on page 95.

        Consumer is well diversified across a number of geographies, product groups, and customer segments and monitors the economic situation in all of the countries in which it operates. In 2006, International Consumer will continue to invest aggressively to build on the competitive advantages of its existing global network of branches, offices and sales professionals. The business expects earnings growth from expanding its customer base, which is expected to drive growth in loans, deposits and investment product sales.    Revenues and credit costs will be affected by global economic conditions, including the level of interest rates, the credit environment, unemployment rates, and political and regulatory developments around the world. International economies are expected to be stable to improving, with an improvement in economic activity expected in Western Europe and a self-sustaining recovery in Japan, two of International Consumer's most important markets. Citigroup's operations in Korea are currently experiencing labor actions that are impairing its ability to offer its full range of products and services. The Company is in active negotiations to reach an expeditious agreement with the union.

        International Cards—In 2006, continued investment in customer acquisition in both new and existing markets is expected to drive increased purchase sales and loan volumes. The credit environment is forecast to remain stable.

        International Consumer Finance—In 2006, investment in new branches and sales professionals will continue in key expansion markets. Organic growth in existing branches, coupled with new branch openings, is expected to drive revenue and earnings growth. Offerings of new loan products and services in new markets will continue, and gains in market share across several key international regions are forecast. The credit environment is expected to remain stable.

        International Retail Banking—In 2006, the business will continue to invest in branch expansion, building on a strong presence in several key markets and establishing its presence in new markets. The business is expected to generate revenue and earnings growth through an expanded base of customers, as well as increases in loan and deposit balances and increased investment product sales.

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