Citibank

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Citibank was founded in 1812 as the City Bank of New York. Citibank is now the consumer and corporate banking arm of financial services giant Citigroup, the largest company of its kind in the world. It is the third largest bank by holdings behind Bank of America and JP Morgan Chase & Co.

Contents

1 History
2 Citibank subsidiaries
3 Miscellaneous financials
4 Key people
5 Other Commercial Banks
6 Trivia
7 See also
8 External links

History

Manhattan Chinatown Citibank branch (New York City, USA).

Founded in 1812 as the City Bank of New York by a group of New York merchants, the bank's first head was Samuel Osgood, who had been the U.S.'s first Postmaster General. Subsequently, ownership and management of the bank was taken over by Moses Taylor, a protégé of John Jacob Astor and one of the giants of the business world in the 19th century. During Taylor's ascendancy, the bank functioned largely as a treasury and finance center for Taylor's own extensive business empire.

In 1865 the bank joined the U.S.'s new national banking system and became The National City Bank of New York. By 1894, it was considered one of the largest banks in the United States, and in 1897, it became the first major U.S. bank to establish a foreign department. In 1913 it was the first contributor to the Federal Reserve Bank of New York.

National City became the first U.S. national bank to open an overseas banking office when its branch in Buenos Aires, Argentina was opened in 1914. Many of Citi's present international offices are older; offices in London, Shanghai, Calcutta and elsewhere were opened in 1901 and 1902 by the International Banking Corporation (IBC), a company chartered to conduct banking business outside the U.S., at that time an activity time forbidden to U.S. national banks. In 1918, IBC became a wholly owned subsidiary and was subsequently merged into the bank. By 1919 the bank had become the first U.S. bank to have $ 1 billion in assets.

Charles E. Mitchell was elected president in 1921 and in 1929 was made chairman, a position he held until 1933. Under Mitchell the bank expanded rapidly and by 1930 had 100 branches in 23 countries outside the United States.

In 1952, James Stillman Rockefeller was elected president and then chairman in 1959, serving until 1967. Following its merger with the First National Bank, the bank changed its name to The First National City Bank of New York in 1955, then shortened it to First National City Bank in 1962, and ultimately changed it to Citibank in 1976. By that time, the bank had created its own "one-bank holding company" and had become a wholly-owned subsidiary of that company, Citicorp (all shareholders of the bank became shareholders of the new corporation, which became the bank's sole owner).

In the 1960's the bank entered into the credit card business. In 1965, First National City Bank bought Carte Blanche from Hilton Hotels. However after three years, the bank (under pressure from the U.S. government) was forced to sell this division. By 1968, the company created its own credit card. The card, known as "The Everything Card," was promoted as a kind of East Coast version of the BankAmericard. By 1969, First National City Bank decided that the Everything Card was too costly to promote as an independent brand and joined Master Charge (now MasterCard).

In 1981, Citibank chartered a South Dakota subsidiary to take advantage of new laws that raised the state's maximum permissible interest rate on loans to 25 percent (then the highest in the nation). In many other states, usury laws prevented banks from charging interest in keeping with the extremely costs of borrowing in the late 1970s and early 1980s, making consumer lending unprofitable.

1998 Citibank logo

Citibank was one of the first U.S. banks to introduce automatic teller machines in the 1970s, in order to give 24-hour access to accounts.

Citibank's operations in California are fairly recent, since it bought out Cal-Fed in 2001. Also in 2001, Citibank settled a class action lawsuit for improperly assessing late fees. The suit was for 45 million dollars. Following this Citibank lobbied in Congress to pass legislation that would limit class action lawsuits to 5 million dollars unless they were initiated on a federal level. Some consumer advocate websites report that Citibank is still improperly assessing late fees.

In August of 2004, Citibank entered the Texas market with the purchase of First American Bank of Bryan, Texas. The deal established Citigroup's retail banking presence in Texas, giving Citibank over 100 branches, $3.5 billion in assets and approximately 120,000 new customers in the state. First American Bank was renamed Citibank Texas after the take-over was completed on March 31, 2005.

It is hoped that with both California and Texas markets, Citibank can appeal to both states' Latino population, and offer products on both sides of the border through Citibank in the U.S., and Banamex (Citigroup's Mexican division) in Mexico.

Citibank has operations in more than 100 countries and territories around the world. More than half of its 1,400 offices are in the United States, mostly in the New York City, Chicago, Miami, and Washington DC metropolitan areas, as well as in California.

In addition to the standard banking transactions, Citibank offers insurance, credit card and investment products. Their online services division is among the most successful in the field, claiming about 15 million users.

In April of 2006, Citibank struck a deal with 7-Eleven to put its ATMs in over 5,500 convenience stores in the U.S. In the same month, it also announced it would sell all of its Buffalo and Rochester New York branches and accounts to M&T Bank.

Citibank subsidiaries

Citibank, N.A. - The "original" Citibank, primarily doing business in New York State and the tri-state New York City metropolitan area. Also the parent company of the other subsidiaries.
Citibank Texas, N.A. - The former First American bank.
Citibank (West), F.S.B. - The former Citicorp Savings (a savings and loan operating in California), as well as the former California Federal Bank and Golden State Bank.
Citibank, F.S.B. - The primary Citibank subsidiary serving all other states, based in Chicago.
Citibank (South Dakota), N.A. - A credit card and lending-only bank based in South Dakota, including the former Universal Bank and Associates National Bank.

Miscellaneous financials

Fiscal year end: December
2005 Sales (in mil.) $83,642
2005 Net Income (mil.) $24, 589
2006 Employees 300,000

2005 Year End Assets $1.5 Trillion

Key people

William R. Rhodes — Chairman, Citibank N.A.
Chuck Prince — Chairman and CEO, Citigroup
Sallie Krawchek — Chief Financial Officer
Shaukat Aziz — Former Executive Vice President & Head of Global Private Banking Division of Citibank, Prime Minister of Pakistan
Alwaleed bin Talal — Shareholder

Other Commercial Banks

Trivia

In early 2006 Citibank began operating ATM's at 7-Eleven stores.
In April 2006, CitiBank announced it would sell all of it's Buffalo and Rochester New York branches and accounts to M&T Bank.

External links

Commercial banks in the United States