INTERNSHIP REPORT

CITI BANK LIMITED

SUBMITTED TO:
Head of internship committee.
Department Of Business Administration
Bahauddin Zakariya University Multan
Sub Campus Sahiwal

SUBMITTED BY:
Muhammad Umair Waqas
BBA(Hons.) 6th semester
Roll no: BBS-06

Department Of Business Administration

Bahauddin Zakariya University

Multan
Sub Campus Sahiwal

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 PREFACE

Banking sector owes a pivotal importance in the economy of any country

through its vibrant functions. That is why being a banking and finance student it
was necessary for me to select a bank for learning purpose so that I can learn
various banking methods and technique not only to enhance my knowledge but
also to implement them on practical grounds
This report is an upshot of my internship experience in Citi Bank, Main Branch,
Garden Town, Lahore . CITI Bank posses an imperative and historical importance
in the banking sector of Pakistan.

My work of these six weeks gave me great practical knowledge banking system
but I strongly belief in a proverb" nothing is perfect" there remains a room of
improvement in every effort for new ideas and more research and knowledge. My
present effort is also a ring of this chain.
I have strong belief that this report will guide and ease the readers to understand
the operations of banking system and more prominently have good knowledge
about CITI BANK, one of the most trusty and Leading banks in Pakistan

Muhammad Umair Waqas

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 ACKNOWLEDGEMENT

I am highly grateful to Almighty Allah who gave me the power to

complete this report. After that without the encouragement and help of my fellows
& my teachers, I perhaps would not been able to write what I have written, it
would be almost an unending list of persons who helped me in one way or other
but then it would be great injustice on my part not to mention the names of those
who provided me the required information and cooperation.

I pay thanks to Mr. Tanvir Bashir “Management & Analytical unit N.A” and
especially “Mr. Abrar Najeeb from the bottom of my heart for their direction &
guidance throughout my project. They not only provided the necessary material &
thoughts, but also encouraged me to do new things that promote a very creative
environment for research. Moreover, they allowed me to expand my expertise in
many areas of banking sector.

A special thanks to Mr. Aamir Ali Mehdi Collection Head of the North Region ,
and also to all related departments and above all my own department of Citi Bank
main branch Lahore who helped me a lot in preparing my report . I am really
thankful to all Heads of the departments in the main branch for their co-operation
during my Internship. At the end I am very thankful to all those persons who
helped me in completing this report.

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 EXECUTIVE SUMMARY

Consistent with Citi’s goal of being the most respected financial services
company, and its corporate philosophy which emphasizes shared responsibility to
the communities where we live and work, Citi Pakistan strives to join its partners
in addressing community challenges through honest, constructive and meaningful
dialogue.

In Pakistan, Citi has been, and continues to be energetic in its support for projects
and initiatives that seek to develop the community. Be it through its philanthropic
arm ‘the Citi Foundation,’ or through timely transfer of expertise particularly in
areas related to the advancement of the local financial sector and employee
volunteerism, Citi Pakistan remains committed to making a difference.

In 2007, Citi Pakistan developed industry-leading initiatives and delivered best-

in-class programs, products, and services to our nonprofit partners and the
communities they serve.

In 2008, we will continue to engage in open and honest dialogue with our partners
and to work with them to proactively seek solutions. And in order to fulfill our
global corporate responsibilities, we are committed to providing programs and
solutions that meet the needs of communities across Pakistan.

We take our responsibility towards our community very seriously. Therefore, we

remain committed to fulfilling our corporate responsibilities through initiating
programs that meet the needs of communities across the country.

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 TABLE OF CONTENTS

Introduction to city bank

Early history
Citi bank Pakistan
Citi bank’s world
Global consumer bank
Global corporate and investment bank
Milestones
Commercial banking
Corporate banking
Work done by me
Financial analysis
Latest news about Citi bank
Bibliography

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 INTRODUCTION TO CITI BANK

Citibank is a major international bank, founded in 1812 as the City Bank

of New York, later First National City Bank of New York. Citibank is now the
consumer and corporate banking arm of financial services giant Citigroup, one of
the largest companies in the world. As of March 2007, it is the largest bank in the
United States by holdings.

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.

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Citigroup Inc. (Citigroup and, together with its subsidiaries, the Company, Citi or
Citigroup) is a global diversified financial services holding company whose
businesses provide a broad range of financial services to consumer and corporate
customers. Citigroup has more than 200 million customer accounts and does
business in more than 100 countries. Citigroup was incorporated in 1988 under
the laws of the State of Delaware. The Company is a bank holding company
within the meaning of the U.S. Bank Holding Company Act of 1956 registered
with, and subject to examination by, the Board of Governors of the Federal
Reserve System (FRB). Some of the Company’s subsidiaries are subject to
supervision and examination by their respective federal and state authorities. At
December 31, 2008, the Company had approximately 134,400 full-time and 4,100
part time employees in the United States and approximately 188,400 full-time
employees outside the United States. During 2008, the Company benefited from
substantial U.S. government financial involvement, including (i) raising an
aggregate of $45 billion through the sale of Citigroup non-voting perpetual,
cumulative preferred stock and warrants to purchase common stock to the U.S.
Department of the Treasury, (ii) entering into a loss-sharing agreement with
various U.S. government entities covering $301 billion of Company assets, and
(iii) issuing $5.75 billion of senior unsecured debt guaranteed by the Federal
Deposit Insurance Corporation (FDIC) (in addition to $26.0 billion of commercial
paper and inter bank deposits of Citigroup’s subsidiaries guaranteed by the FDIC
outstanding at the end of 2008). In connection with these programs and
agreements, Citigroup is required to pay consideration to the U.S. government,
including in the form of dividends on the preferred stock and other fees. In
addition, Citigroup has agreed not to pay common stock dividends in excess of
$0.01 per share per quarter for three years (beginning in 2009) or to repurchase its
common stock without the consent of U.S. government entities. On January 16,
2009, the Company announced realignment, for management and reporting

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purposes, into two businesses: Citicorp, primarily comprised of the Company’s
Global Institutional Bank and the Company’s international regional consumer
banks; and Citi Holdings, primarily comprised of the Company’s brokerage and
asset management business, local consumer finance business, and a special asset
pool. Citigroup believes that the realignment will optimize the Company’s global
businesses for future profitable growth and opportunities and will assist in the
Company’s ongoing efforts to reduce its balance sheet and simplify its
organization. See “Outlook for 2009—Changes to Citi’s Organizational
Structure” on page 7. On February 27, 2009, the Company announced an
exchange offer of its common stock for up to $27.5 billion of its existing
preferred securities and trust preferred securities at a conversion price of $3.25
per share. The U.S. government will match this exchange up to a maximum of
$25 billion of its preferred stock at the same conversion price. These transactions
are intended to increase the Company’s tangible common equity (TCE) and will
require no additional U.S. government investment in Citigroup. The principal
executive offices of the Company are located at 399 Park Avenue, New York,
New York 10022, telephone number 212 559 1000. Additional information about
Citigroup is available on the Company’s Web site at www.citigroup.com.
Citigroup’s recent annual reports on Form 10-K, quarterly reports on Form 10-Q,
current reports on Form 8-K, as well as the
Company’s other filings with the Securities and Exchange Commission
(SEC) are available free of charge through the Company’s Web site by clicking
on the “Investors” page and selecting “All SEC Filings.”

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10
 CITI BANK PAKISTAN

History

Citi’s goal is to be the most respected global financial services company.

As a great institution with a unique and proud history, it aims to play an important
role in the global economy and stands by its principle of always putting its clients’
interests first, acting with the highest level of integrity, respecting local cultures
and taking an active role in the communities it operates in.

Citi has been operating in Pakistan since 1961 and has a highly respected
franchise through its successful delivery of innovative, high-quality banking
products and services to its customers. It has many ‘firsts’ to its credit including
launching the first Credit Card in Pakistan, pioneering Consumer Asset financing
and introducing the first 24x7 call centre.   

Citibank has been at the forefront of the financial sector reform process and has
been the lead bank in taking the Government to international capital markets,
including issues of the 1st Foreign Currency Sukuk, the 1st 30 year US$
Sovereign Bond and the first equity offering in over a decade. It is also the
leading bank in Pakistan for delivering Export Agency and Multilateral financing
and has been instrumental in the development of Pakistan’s market for derivatives
and other treasury products.

Business

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 With more than 1,100 employees, Citi Pakistan operates through two
major business lines- the Global Consumer Group and Citi Markets & Banking,
providing a variety of services to more than 200,000 consumer & corporate
clients.Citi has steadily expanded its network over the last two years and now has
23 branches and 39 customer contact points across 10 cities in Pakistan.

Community

In an effort to play an active role in the development of the communities it

operates in, Citi, through its philanthropic arm, the Citi Foundation, continues to
support several initiatives in Pakistan in the areas of Corporate Governance,
Microfinance development and Financial Education. Over the past 4 years a total
of $2,658,000 has been allotted as grants to various social sector partners in
pursuance of this goal.   

CITI BANKS WORLD

Combining some of the most respected brands in the financial services

business -- the Global Consumer Bank and the Global Corporate Investment Bank
- are uniquely positioned to offer a complete array of financial products. Citigroup
operates in a global economic environment which requires the expertise of a true
market leader.

Global Consumer Bank

Citibank Pakistan has demonstrated its ability to identify market needs and
develop products which are unique in concept and fulfill customer requirements.

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The aptitude to develop lifelong relationships while maintaining quality measures
and technological efficiencies has assisted Citibank in becoming a true market
leader.

Powerful distribution networks, electronic channels, myriad of financial products

which cater to customer mix, broad product capabilities - this is what is needed to
succeed in the volatile markets of today. This is what allows us to offer institutes
worldwide the right financial solutions - every time, all the time.

Global Corporate and Investment Bank

Corporate and investment banking clients include corporations at every

stage of development. Catering to the changing needs of corporations and
leveraging on long term relationships, we execute transactions of almost any size,
of every level of complexity, and back them with a wide distribution network.

Every customer is served by a versatile team of relationship managers who ensure

in-depth knowledge of trends and opportunities while synchronizing their
financial activities.

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 MILESTONES

Citibank Pakistan's Milestones of the 90's

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 The nineties were a decade of domination and leadership for Citibank in
the Pakistani marketplace and the trend continues into the new millennium.

199  Consumer Bank was established.

0
199  Consumer Asset Business is launched.
2  Car Financing is introduced.
 CitiGold Priority Banking is established.

 CitiPhone Banking launched.

199
 Citibank Visa Card (Gold and Silver) is launched.
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199
 Self-Service Banking launched.
5
199  Citibank, N.A. launches its Intranet System in April.
6
 First bank to launch a Photo Credit Card.
199  Citibank wins over 35 awards under the Euromoney Excellence
7 Awards. These awards included "Best Bank" and "Best Emerging
Market Bank" for two successive years.
 Citibank and IBA develop an MBA program focused on Marketing
of Financial Services (MFS).
 Citibank, N.A. pledges a donation to LUMS for their "Students Aid
Program".
 Citibank, N.A. in November holds its first ever Car Financing

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 Dealer conference in Bhurban.

 Citibank, N.A. opens its sixth branch on Shahra-e-Faisal in Karachi

in December. This branch has the first 24-hour zone with ATMs
and CitiPhone booths.
199  Citibank launched Pakistan's first affinity card known as the
8 "Citibank-Shaheen Credit Card". 
199  First foreign bank to launch MasterCard in Pakistan.
9  Citibank Home Loans is launched.
 Car Financing Product Feature enhancement (25% Down Payment,
Free Pre-approved Credit Card with each car).
 0% Down Payment product for your second car.

 Complaint Tracking System (CTS) launched.

200  Citibank, N.A. is the first Financial Institution to launch Personal
0 Loans in Pakistan.
 The cards business launches the first ever Co-brand Credit Card in
Pakistan with Caltex.
 Dewan Farooq Motors Limited manufacturers of KIA and Hyundai
cars in Pakistan, and Citibank joint label financing program.
 Suzuki Car Financing private label Car Financing loan financing
program.
 The Paktel-Citibank Credit Card is launched in June.
 LG-Citibank Installment Plan is launched in June.
 The liabilities business launches the "Karobar Account".

 CitiPhone Banking introduces Self Service Banking

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 COMMERCIAL BANKING

The Commercial Banking Group offers comprehensive solutions to meet

the needs of small and medium sized companies. Its portfolio management team
is specialized in sectors such as Textiles, Food & Allied, Chemicals, Auto
Vendors, Consumer Durables, Traders, and Educational Institutions, which
constitute Pakistan’s core business environment.

The Citibank brand has been built on our overarching belief that customer trust
and satisfaction are the basis of business success. We are committed to delivering
the best possible products and services and our success is continually
acknowledged through recognition such as Euro week magazine’s award for best
book runner of Asian currency bonds and Finance Asia magazine’s award for
Best Cash Management Bank.

Citibank performs banking activities over 100 countries around the world and
now brings its experience to those companies who think big. Small and medium
sized companies have started finding solutions to their banking needs through the
Commercial Banking Group. You can benefit from Citibank’s support.

In Pakistan, Citi has been, and continues to be energetic in its support for projects
and initiatives that seek to develop the community. Be it through its philanthropic
arm ‘the Citi Foundation,’ or through timely transfer of expertise particularly in
areas related to the advancement of the local financial sector and employee
volunteerism, Citi Pakistan remains committed to making a difference.

In 2007, Citi Pakistan developed industry-leading initiatives and delivered best-

in-class programs, products, and services to our nonprofit partners and the
communities they serve.

18
In 2008, we will continue to engage in open and honest dialogue with our partners
and to work with them to proactively seek solutions. And in order to fulfill our
global corporate responsibilities, we are committed to providing programs and
solutions that meet the needs of communities across Pakistan.

We take our responsibility towards our community very seriously. Therefore, we

remain committed to fulfilling our corporate responsibilities through initiating
programs that meet the needs of communities across the country.

Personal Banking

1. Local Currency Deposits

2. Foreign Currency Deposits

3. Credit Cards

4. Debit Cards

5. Home Loans

6. Insurance

1. Local Currency Deposits

1. Rupee Current Account

2. Rupee Savings Account
3. Rupee Citi Ultimate Account
4. Current Account Premium
5. Citibank Premium Profit
6. CitiOne

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2. Foreign Currency Accounts

Citibank Foreign Currency Account provide you financial value and great
transactional convenience, 24 hours a day, 365 days a year. Take a look at their
features and you will know why.

1. Premium FCY Accounts

2. Savings Account
3. Term Deposit

CURRENCIES:
You can open an account in any of the below mentioned currencies.

1. US Dollar.
2. Great Britain Pound Sterling.
3. Euro.

SERVICES OFFERED:

i. Premium FCY Accounts

ii. Savings Account

iii. Term Deposit

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 Credit Cards:

1. Gas Stations Spending Limit

2. New Minimum Pmt Policy
3. Citi Mobilink Credit Card
4. Citibank Caltex Credit Card
5. Citibank Clear Card
6. Citibank Gold & Silver Cards
7. E-card
8. Citibank Shaheen –
9. Affinity Credit Card

Citi Classic & Gold Cards

  Get a low rate and all the buying power  
you need

       

Citi Mobilink Card

  Earn 5 Talk Points to redeem for Free  
Air Time

       

Citi Caltex Card

  Earn up to Five Points to redeem for  
Free Fuel

       

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 Citi Clear Card
  Fantastic discounts at your favorite  
spots

Citibank Clear Card

My Choices in life are CLEAR...

so is my CARD!

Overview

Here is a Credit Card that not only looks good, but gives you more out of
life. With your Citibank Clear Card, you can look and feel good and stay ahead in
life.

It comes with 3 Free Supplementary Cards and not only Mega Deals! but
exciting discounts from leading brands but also free tickets, Lucky Draw Prizes
and privileges to Fun filled, Hip & Happening Events and Entertainment.

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An extraordinary complimentary package filled with free gifts & leading
incredible discounts on everything from dining to music to travel, & a whole lot
more.

Citibank Gold & Silver Credit Cards

Citibank Gold Credit Card

The Citibank Gold Credit Card is specially designed for you, your
exclusive life style and your special needs. As a Gold Credit Card member you
enjoy a higher Credit Limit throughout the world. If you have a monthly income
of Rs.50,000 or above, and you are a Pakistani citizen, then you are eligible to
apply for a Citibank Gold Credit Card.

Citibank Silver Credit Card

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 The Citibank Silver Credit Card brings you the convenience and financial
flexibility you can expect from the World's No. 1 Credit Card. The Silver Card is
a truly international Credit Card offering unmatched features and benefits and
complete peace of mind. If you have a monthly income of Rs.16,000 (Rs 8,000
for selected corporate employees) and are a citizen of Pakistan then you are
eligible to apply for a Citibank Silver Credit Card.

Citibank e-card

Shop with peace of mind on the Internet through your Citibank E-Card!

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As the first Internet Shopping Card in Pakistan, the Citibank E-Card is packed
with unique advantages for shopping on the Internet. This means convenience,
security, fabulous discounts and much more

Citibank Debit Card

Introducing the new Citibank Debit Card

More than an ATM Card with everything you want from a Credit Card

1. Secure:
It is safer than carrying cash, has your signature for easy identification,
and allows you to define your monthly purchase limit. You can even opt
for a Photo Debit Card for added security.

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 2. Convenient:
Pay directly from your account for purchases made using your Citibank
Debit Card which is accepted at over 10,000 retail outlets in Pakistan.
3. Global Acceptability:
Citibank Visa Debit Card is accepted at all VISA merchants having
4. electronic terminals, in Pakistan and around the world.

Insurance

1. Health Forever
2. Life Plus

3. Credit Shield Plus

4. Family Protection Plan

5. Secure Wallet Plan

6. Savings Plan

Health Forever

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Life is all about being prepared

Life is all about being prepared. That’s why it is important to plan ahead
for emergency medical costs, so that you stay prepared for any eventuality. Health
forever assures you of the best medical treatment, With Health Forever Citibank
customers get protection against medical costs arising as a result of an accident
or sickness and include life insurance as a built-in feature. Health forever protects
you against these costs for a small premium payment, so you can forget about
what might happen tomorrow and start living today.

Citibank Credit Shield Plus

If the unexpected happens, you are covered.

Credit Shield Plus is now available with Double Indemnity which

provides for an additional payment equal to the outstanding on Citibank Credit
Card to the beneficiary nominated in case of accidental death. Citibank Credit

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Shield Plus gives you total peace of mind by insuring you against unforeseen
emergencies concerning your health and life. Under this cover, if you are unable
to pay the minimum amount because of temporary disability, the underwriter will
pay on your behalf. In the unfortunate event of prolonged critical illness,
permanent disability or even death, the underwriter will pay the entire total
balance on your Citibank Credit Card. In the event of an accidental death, the
underwriter will pay the beneficiary ( appointed by the Card member ) an equal
amount of the outstanding on Citibank Credit Card balance.

Credit Shield Plus offers you peace of mind by helping you pay your Citibank
Card payments when you are not able to, so your loved ones will not be burdened
with these payments.

Citibank Credit Shield Plus provides insurance coverage on occurrence of the

following events

Family Protection Plan

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Express your love...
Protect your family's future

Express love for your family by ensuring their lifetime happiness & security. Get
a continued insurance cover for them with the Family Protection Plan by AIG.
The Family Protection Plan is a personal accident insurance policy that provides
coverage on a 24-hour worldwide basis against the following:

 Accidental Death
 Permanent Total Disability
 Accidental Medical Expenses

Premium will be charged on your credit card or debited from your bank account
on easy monthly instalments. The sums insured and monthly premium amount
payable on account of sums insured are stated below:

Benefit Coverage Premium

Accidental Death (AD) & Permanent Total Disability (PTD) Rs. 1,000,000
Rs. 165
Medical Reimbursement per month Rs. 25,000

Secure Wallet Plan

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There is a better way to secure your wallet.

Insure your wallet against loss or theft!

Citibank Secure Wallet Plan is the ultimate protection for your wallet. This is the
only insurance plan that covers you against all the following risks:

 Loss or theft of your credit card(s)

 Loss or theft of your keys and identification papers
 Death or disability (due to theft/robbery)
 ATM Cash Withdrawal Cover (due to theft/robbery)

Enjoy complete peace of mind while you are shopping, at work or anywhere in
the world, as Secure Wallet Plan provides your wallet with the protection it needs
- securing your credit cards, be they of Citibank or any other bank, keys and
identification papers.

Insurance coverage is available worldwide for 24 hours a day. All financial losses
are underwritten by AIG - the leading insurance company in the world.

Savings Plan

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Your Family’s Hopes Depend on you. Saving Plan ensures it doesn’t end with
you!

Why Savings Plan?

This plan offers you a Financial Solution enabling you to spread the financial
outlay of regular premium payments over the term of the policy. It’s a flexible
policy that combines Savings with Life Cover.

Key Benefits of Savings Plan Policy

 Lump sum payment of Rs.1,000,000 without any extra charge in the event
of Accidental Death of the parent (life assured).
 Guaranteed minimum Annual Yield of 4% on accumulated cash value.
 No Medical Checkups required.
 Partial Withdrawal & Loan Facility available for key milestones in your
child’s life.
 Hedging option available to protect accumulated cash value against
inflation.

Global Access

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Citibank ATMs

At Citibank, our goal has always been to provide you with better facilities
and greater convenience.

1. Access to over 850 machines in 30 cities & over 360,000 ATMs

worldwide
2. Withdraw up to Rs. 160,000 per day.
3. Make a deposit (cash or cheque) – this feature is only available at ATMs
located in Citibank branches.
4. Get US dollars – this feature is only available at ATMs located in Citibank
branches.
5. Get a Mini-Statement.
6. Transfer funds with-in your Citibank accounts

CITIBANK ONLINE (CBOL)

Citibank Online Internet banking gives you the power and convenience to
perform most of your banking activities from the comfort of your home or office,
any time of the day or night. You can:

 Check your account details including balances, Credit card balances and
other loan details
 Transfer between your accounts with Citibank Pakistan
 Transfer money to another Citibank customer in a matter of seconds
 Make a Request for demands drafts and local currency manager’s checks
 Pay your Utility bills
 Order account statements or new cheque books

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 CORPORATE BANKING

Citibank Merchant Services

Become a Citibank Merchant

Citibank has the distinct advantage of being the largest acquiring bank in
Pakistan. Currently, we have approximately 5000 merchants.

We provide state of the art merchant services that are distinctively superior to any
other acquiring bank in Pakistan. Citibank offers Electronic Data Capturing
machine for card acceptance at the POS through ORIX network. Additionally,
Citibank gives you the convenience of a back up manual machine, in case of
power failures.

The payment process is graphically presented below:

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 Corporate Banking

1. Cash Management
2. Treasury

3. Corporate Bank

4. Financial Institutions

5. Investment Banking

Cash Management

Corporate and financial institutions are constantly faced with practical

problems of handling and collecting cash under various diverse regulatory,
political and cultural environments. How does a company collect its sale proceeds
from remote upcountry regions? Which instruments ensure both quicker receipt of
funds and minimize credit risks? How does a company pay its regular suppliers

34
without keeping numerous bank accounts for various locations and then
reconciles them periodically in a highly manual / paper-based environment?

Cash management is a core business for Citibank. Commitment to service quality

and an ability to adopt new technologies are the components of Citibank's Cash
Management strategy. Our experience in the local Pakistani market along with our
ability to provide global solutions enables us to offer a full range of cash
management products and solutions. These products are aimed to help maximize
resources while providing you with value-added solutions to meet your needs.

Citibank Pakistan offers its cash management products and services aimed to
improve the cash flow side of the business and operations. Citibank also focuses
on delivering time critical information to directly impact the business efficiency.
Through its elaborate product offering, Citibank aims to:

 Manage the increasing complexity of cross-border and domestic payments

 Improve cash flow forecasting under a cost control environment
 Limit the exposure to risk associated with growth
 Enhance security of the cash flows and reduce the possibilities of fraud
 Improve overall working capital flows via adding efficiency to the overall
operations

Treasury

In an exceedingly volatile economic environment, Citibank's Treasury department

emerges as a leader in the local interbank market, as well as the institution of
choice amongst importers and exporters, by providing superior treasury products
to its clients.

35
Apart from dealing in Foreign Exchange (FX) and Money Markets, the Interbank
desk participates actively in all Central Bank operations, including T-Bill
Auctions and Open Market Operations. The main products traded on the FX desk
include Ready and Spot Outright Purchases/Sales as well as Swaps, while the
Money Market desk deals primarily in Repo and Reverse Repo transactions.

The Treasury Marketing Unit (TMU) has been designed to serve the needs of
corporate customers. With the recent deregulation in the foreign exchange market
and the resulting increase in volatility, Citibank has tailored its products to cater
to specific customer requirements by providing unmatched service and
customized hedging options.

Corporate Bank

CustomerSatisfaction
The Corporate Banking Group at Citibank in Pakistan is committed to
providing its clients the highest level of service possible. Recognized as a leader
and a trendsetter in the financial markets, the Corporate Bank strives to achieve
Citibank's global objective of customer satisfaction and quality through a well-
diversified product offering and a team of highly professional Relationship
Managers. The Corporate Bank manages a high quality asset portfolio being an
active player in many sectors including textile, sugar, leather, pharmaceutical,
fertilizer, petrochemical, power, aviation, automative, telecommunications, oil
and gas distribution and fast moving consumer goods industries. Companies in
our client base include leading multinational corporations, top tier local corporate

36
organizations and public sector entities. Citibank has been instrumental in
bringing together local companies with international players in several Joint
Ventures. This has been possible because of Citibank's Global Relationship and
transnational network.

Financial Institutions

The Premier Correspondent Bank

While systems and technology are an important component of global

banking, our business relies on the strengths of the people dedicated to meeting
your needs. With this in mind, we have organized around what we call
"local/global team" a group of Citibankers who work closely together to provide
you with seamless delivery of financial solutions in your own markets, as well as
globally. This team includes your local relationship managers, account managers
at major financial centers and client services and trade services representatives.
Our goal is to ensure that, when you deal with any Citibank center worldwide,
you receive the same level of personalized, high quality service from individuals
who know you and your business

Investment Banking

CitiGroup world leader in Invest Banking

Citigroup has been recognised as the best arranger of syndicated loans. In

January 2000, IFR recognised Citigroup as the overall "Bank of the Year" and
"Loan House of the Year" for 1999. [link to ssb and Citibank sites] In January
1998, Citibank was awarded Best Arranger of Syndicated Loans by Euroweek.

37
Citibank was also voted Best Foreign Bank for 31 of the 69 countries reviewed in
July 1998.

Capital Markets

1. Foreign Capital Market Transactions

Citibank is the leader in international capital market transactions for Pakistani

issuers. Through the development of innovative financial products and the ability
to successfully tap international capital markets, Citibank has raised long term
financing in the form of Global Depository Receipts ("GDRs"), Euro-convertibles
and Floating Rate Notes ("FRN")

2. Local Capital Market Transactions

Citibank has been the leading player in the syndicated loans business. It
has nurtured a diverse local investor base, demonstrated by its unmatched track
record of raising financing in excess of PKR 20 billion for the local market.

Citibank is also one of the leading players in the distribution business, which
involves arranging syndicates for Initial Public Offerings ("IPOs"), rights
issues and distribution of term finance certificates. As a result of its involvement
in these transactions, Citibank has achieved a clear understanding of the various
complex regulatory, legal and business issues, that form an integral part of the
capital markets business.

3. Securitisation

Securitisation offers a strategic funding alternative, since it allows for the

conversion of assets, with strong cash flows, into a capital source. Citibank has
pioneered both local and foreign currency securitisation transactions. It has

38
completed local currency transactions worth PKR 2.5 M. Moreover, Citibank
successfully arranged the first ever local currency future receivables securitisation
in Pakistan.

39
 Work Done By Me

Collection Training
Collection MIS
Objectives:
 To become familiar with the basic collection operations and terminologies
 To understand the core operations of collection MIS
 To become familiar with the reporting and monitoring of collections
 To understand the collection MIS reports and analyze them

COLLECTION MIS COVERAGE

• Covers the North region for Auto, PIL, Card and Recoveries

40
 • Cities under the coverage area:
– Faisalabad
– Lahore
– Rawalpindi
– Islamabad
– Sialkot
– Gujranwala
– Multan

REPORTS
• Reports made on daily and monthly basis and also per the cycle cut
• Reports made covering the banking products of:
– Autos
– PIL (Personal Loan)
– Credit Cards
• Reports made for collection HR including
– Incentives
– Payrolls
– Resign and hiring status
– Employee performances
– Other HR related issues

DAILY REPORTS
• Delinquency Reports:
[The defaulted credit obligations (unpaid credits) are called delinquency]
 For Autos and Personal Loans (Banking):
– 30+ delinquency ( 30 + Exposure/ Total Exposures)

41
 – 60+ delinquency ( 60 + Exposure/ Total Exposures)
 For Credit Cards
– 30+ delinquency ( 30 + Exposure/ Total Exposures)
– 90+ delinquency ( 90 + Exposure/ Total Exposures)
• Was/IS Reports:

 Operations of collection process

– Buckets
– Forward Flow [FF]
– Normalization
– Stabilization
– Roll Back

Buckets:
– A measure that helps understands how the portfolio is doing. It
helps measure the degree of delinquency
PIL Lahore, 25th June, 2007.

Productivity Index:

 P.I. is a tool that measures collector productivity and performance

 It is composed of system measured factors that are combined to
arrive at a single score
 P.I. takes in to account the following factors

42
 • Contact Ratio
• Promise to Pay
• Promise kept ratio
• Money Collected
• Calls per day
• Hours worked
 P.I. is used for collector evaluation and incentive preparation

Daily Status [cards]:

– Includes bucket and cycle wise number of accounts
– Balances including EPP (Easy Payment Plan)

Daily Recovery Reports:

– Includes the payment recovered on daily basis from transaction
journals (TJ’s)
– Division by negotiation and legal .
Asset Available for sale [Autos] (AAFS):
– Includes the repossessed vehicles inventories
– Aging report of these vehicles

Salary Compensation:
– Basic salary
– Overtime
– Fuel
– Other incentives

43
 Charge offs [Cards, Autos, PIL]:
 Charge off Portfolio Report – includes all accounts written off
 Recovery accounts Report – includes accounts which are recovered
 Charge/Recovery Breakup by Balance Report – includes the year
in which the account was charged off and the year in which it was
recovered
 No activity Report – includes account detail on which no activity
has taken place

Collection WAS/IS [Cards, Autos, PIL]:

– Calculate incentives according to the Forward Flow and
Normalization by achieving the benchmark

Incentives Report:
– Reports made according to the benchmark achieved over the
previous month of Forward Flow and Normalization

CITY Buckets FE 30 60 90 Over All

Accounts 8675 1597 920 602 11794
KHI Collectors 20 11 8 8 47
ACR 434 145 115 75 251
Accounts 3239 583 467 394 4683
FSD Collectors 9 5 4 3 21
ACR 360 117 117 131 223
Accounts 8012 1489 914 705 11120
LHR Collectors 18 13 9 11 51
ACR 445 115 102 64 218

44
 Accounts 4544 867 606 434 6451
RWP/ISD Collectors 10 6 5 6 27
ACR 454 145 121 72 239
Accounts 16911 3147 2073 1654 23785
North Collectors 40 25 19 21 105
ACR 423 124 110 79 227

CARDS COLLECTION:

 To standardize & streamline the process / procedures for the management

of bank card account while these are under collection control.
 Collections responsibility will commence from the time an account
becomes current due, delinquent or over limit until it is regularized by
means of payment or its closure and full payment is collected.

GOALS OF THE COLLECTION:

PROGRAM
 The primary goal of the collections process is to obtain payments
promptly while minimizing collection expense and write-off cost as well
as maintaining customers` goodwill by a high standard of service.
 The secondary goal of collections is to protect the losses of the bank. This
can be achieved by identifying early indications of delinquent customers
and thus minimizing losses.

ACCOUNT CATEGORIES IN COLLECTION

a)  NONSTARTER ACCOUNTS.

45
 Is one in which customer does not pay on the first billing date.
b)      There are two types of non-starter accounts with spending and without
spending. With spending is high risk account is one in which customer delay the
pmt on the first billing date and without spending is one in which card is not
used just annual membership fee is charged & if the card moves to 75 dpd
collection will fwd the referral for reversal.
c)      OVERLIMIT ACCOUNTS.
An account is considered over limit when the outstanding balance exceeds
the limit by RS 1 .In over limit high risks account with 10% over limit will be
blocked by H & 20% with block I & above 20% is block with J.

d)      DELINQUENT ACCOUNTS.

An account is considered delinquent in CACS when the minimum amount
due is not paid until the cycle cut date.
e) CURRENT DUE BUT NOT DELINQUENT.
An account is classified as current due but not delinquent in CACS if the
current minimum amount due is not paid ….these account appear in CACS
after due date & called (preemptive).

Management Information System

The MIS reports generated are utilized to evaluate and report performance
achievement of the Collection Department, team or an individual. These reports
are based on each CACS location, according to product for individual billing
cycles as they are cut.

46
The MIS reports are thus tools for the Collections Department and the
management for analyzing our present position and planning future Collection
strategies.
a. MIS reports are produced based on CARDPAC and CACS data,
downloaded on daily weekly or monthly basis.
b. MIS reports are useful tools for Supervisors and Managers for monitoring
and analysis purposes. For example, Supervisors and Managers can find
out the reason for a particularly high delinquency in a cycle or region by
looking at flows from one bucket to another or due to higher balance in
particular buckets.
c. The performance of an individual CO or a team looking after a billing
cycle can also be judged by reviewing at both the lag/flow as well as the
collector performance report.
d. The number of accounts appearing in each individual bucket helps in
reviewing the collector capacity of each region.

Collection MIS Reports

CACS generates reports on a daily/weekly or monthly basis. Some of
these reports pertain to system activities and maintenance whiles other help
towards the collection efforts and results. Some of these reports are:

Cycle Cut Report

This report is a detailed summary of each billing cycle by each billing
cycle by region, indicating the cycle delinquency as well as the net flow analysis
in comparison to the past months.

Sum of Cycle Report

47
 This report is summary of the delinquency of each billing cycle as well as
the overall delinquency of each product and the total portfolio.

Productivity/Effectiveness Report
This report shows the results of individual efforts by CO while giving
information like:
1. Hours worked
2. Attempts
3. Calls
4. Contacts
5. Promise taken
6. Promises kept%
7. Amount collected.
These reports along with the results of decline or rise in delinquency of a cycle
within a region help to track team performance for a particular day and month to
date. These reports are also available for respective functional areas.

CACS Aging
This report indicates normalization, roll backs, stabilization and forward
flows of respective cycle during the month. By looking this report Managers can
easily monitor any individual’s performance for that month. This report triggers
the exact reasons of any increase/decrease in delq /flows.

Daily MIS Monitoring

All Collection shops prepare daily delinquent/flows monitoring MIS. It
helps Managers to evaluate shop’s current status so that they can easily strategies
their collection efforts as per requirement.

48
Performance Evaluation
Collections evaluate performance of each and every CO/FC the defined
criteria monthly basis.

1. Calls/CO/day
2. Contact ratio
3. PTP ratio
4. PK ration
5. Normalization ratio
6. Forward ratio

All shops will display the monthly evaluation MIS on the notice board so
that each and every Co can see his/her performance. This process will create a
healthy competition among the collection staff and should form the basis of
counseling by Supervisors/Managers.

Daily PI Monitoring
This MIS helps the Supervisor to evaluate each CO’s productivity on daily
or MTD basis. PI (Productivity Index) is an established measure to monitor FE
productivity which is calculated as per following method.

MTD
a) Is Month to date performance

Forward Flows

49
 b) The accounts within each delinquency bucket which move to next
bucket during the course of one reporting period.
GCWO (Gross Credit Write Off)
GCL (Gross Credit Loss)

Recoveries
The amount recovered from write off portfolio is called recovery
NCL (Net Credit Loss)
GCL - Recovery

Normalization
 A delinquent account which was cured back to current bucket.
Stabilization
 A delinquent remains in the same bucket due to payment of one bucket
minimum amount.
Lag/flow
Includes summary of each billing cycle by region indicating the cycle deq
as well as the net flow analysis in comparison with the past months

DAILY CARD WAS/IS REPORT

 The report is about the collection of the card status
 Was and is represent that the standing of the amounts that were due
yesterday and today
 There must ber appositive percentage change to justify the
correction of was and is report

50
  If there will be any negative percentage that means your report is
incorrect
 Cities covered in this report are
LHR,FSD,RWD,MUL,KHI,HYD,GUJ and SLK
 Buckets are current, past due ,30,60,90,120 and 150
 The formula of bucket is 1-29 days = bucket 30
 The column of grand total represents that how much amount is still
to be collected from the customer

DAILY CARD RECOVERY REPORT

 The purpose of the report is to have a look on the figures that how much
amount has been recovered in the whole month from cards.
 The figures are collected on the daily basis
 Managers require these amounts to see how well their recovery
department is performing
 The report shows the figures of Pakistan

GCL TRACKER
 The report is about the GCL (Gross credit loss) of the bank across
Pakistan
 The products covered in this report are autos and PIL
 The amounts in these heads describes the figures in million dollars
 For each month the dollar rate is provided by the financial analytical
department to convert these figures in PKR
 The conversion of figures is required to find out the exact GCL in Pak
rupees.

51
 DELINQUENCIES REPORT
 The report shows the number of accounts that are still delinquent(to be
recovered) in all the regions
 The report gives the picture about the number of accounts in each
bucket
 As well as also gives a clear picture about the amounts pending
 The report is very much important for the managers because whole
working of the day and for the month is dependent on this report
 Any error in this report will result a great change in the projections of
the month
 The report describes the delinquent accounts for 30+ and 60+ days

PRINCIPAL RECOVERY
 The most important report for the heads of CITI is principal recovery
 The report describes that how much amount has been recovered in the
products AUTO and PIL across Pakistan
 This recovery has been made from the customers who default from the
bank
 This is the loss of the bank but when the recovery is made the bank lessens
its loss
 That is why the report bears heavy importance
 The amounts are in million dollars again these amounts are converted into
PKR by the exchange rate of the dollars that has been provided by the
financial analytical department
 The report is designed in such a way that it reflects the heads about three
months comparison of the figures

52
  That makes them easy to analyze and understand what is the present
scenario and where we were standing on the same day in the last two
months
 The report also shows the figures of expenses that has been occurred
during the recovery of thee amounts
 As well as also tells us about the amounts that has been recovered by the
outsource department of city

OTHER RESPONSIBILITIES
 My other responsibilities are of HR coordinator of the North region.
 To prepare the salary of about 550 staff members that are under the head
of North region
 To prepare the incentive of these 550 staff members on monthly basis
 To prepare the salary of the Regional Managers and Managers on monthly
basis
 To prepare the incentive of the above mentioned Managers on monthly
basis
 My other responsibility is to complete the hiring document of the new
staff members and to coordinate with HR Head Karachi for their hiring
 Completing the document of the resigning staff is also under my JD
 Moreover maintaining the record of leave status of the permanent staff
 The major responsibility of mine is to conduct different sort of trainings in
the Main branch for Collection staff
 Before conducting that training the training Managers trained me for such
sort of training(some results and training certificates are attached)

53
Financial analysis

54
2008 FINANCIAL RESULTS

We reported a loss of $27.7 billion in 2008. This unacceptable result

reflects the impact of a weak economy and a lack of market liquidity on various
assets we carried into this downturn. As previously disclosed our results included
$32 billion of revenue mark-to-market losses on assets in our Securities and
Banking business. In addition, like all major banks, we are experiencing elevated
credit losses as our customers struggle to repay loans. As credit quality
deteriorated, we added to loan loss reserves. Our 2008 results reflect a net build of
$14.7 billion to our loan loss reserves. We ended the year with total loan loss
reserves of $30 billion. Our financial results this year were very disappointing.
However, away from these losses, our core franchises are performing well and our

55
customers remain active and engaged with Citi around the world. We will build
on this to achieve our highest priority—returning Citi to profitability.

RESTRUCTURING CITI

We accelerated the second stage of our drive for value creation—

Restructuring Citi—by realigning Citi into two operating units—Citicorp and Citi
Holdings. This structure highlights the value of our core franchise and reflects the
rapid and dramatic changes in funding markets, operating models, and client
needs. The new structure simplifies Citi, and sets out a clear path to profitability
and value creation. In the new structure, Citicorp is our global bank for businesses
and consumers. Citicorp consists of the Global Institutional Bank, which includes
Global Transaction Services, Corporate and Investment Bank, Citi Private Bank,
and the Retail Bank. The Retail Bank includes regional consumer and commercial
banking and card franchises around the world. Approximately two thirds of
Citicorp’s balance sheet is deposit-funded. It has relatively low-risk, high-return
assets and it operates in the fastest-growing areas of the world. On a stand-alone
basis, I believe there is no stronger financial services firm than Citicorp. Citi
Holdings includes some great businesses that have strong market positions but are
not central to our core operating strategy. Citi Holdings is made up of brokerage
and asset management; consumer finance, mortgage loans, and private label credit
cards; and a special asset pool. Approximately one third of our headcount
supports Citi Holdings and it includes the $301 billion of assets covered by our
loss-sharing agreement with the U.S. government. We will continue to manage
these businesses and assets to ensure we maximize their value to our shareholders
and will be alert to sensible dispositions or combinations. With lower risk and a
streamlined set of businesses, we expect Citicorp to be a high-return and high
growth business. With Citi Holdings, we will be able to tighten our focus on risk

56
management and credit quality. And, with the right structure and management in
place, we’ll be able to turn our attention to the third stage of our growth strategy:
Maximizing Citi.

2009 AND BEYOND

The best way to make good on our commitments to investors, clients,

policymakers, employees, and citizens is to return Citi to profitability as soon as
possible. As a Citi shareholder, you have experienced an extremely disappointing
year and I know that any return to profitability is long overdue. You should know
that we are doing everything in our power to accelerate that return. We recognize
that industry profitability may continue to be affected by asset price volatility and
credit deterioration. But we also see that the policies implemented thus far are
setting the stage for recovery.
We enter 2009 with the drivers of profitability in place. Our funding, risk capital,
and underlying revenue levels are strong. Our expenses and risks have been
reduced. We are taking control of what is within our control. Although 2009 will
likely remain a challenging year—particularly in terms of credit costs—we
believe that as the economic environment begins to recover, as it inevitably will,
Citi will be well positioned to create the kind of shareholder value of which we all
know Citi is capable and which you should reasonably expect

57
58
2008 IN SUMMARY

Citigroup reported a $32.1 billion loss from continuing operations ($6.42

per share) for 2008. The results were impacted by continued losses related to the
disruption in the fixed income markets, higher consumer credit costs, and a
deepening of the global economic slowdown. The net loss of $27.7 billion ($5.59
per share) in 2008 includes the results and sales of the Company’s German retail
banking operations and Citi Capital (which were reflected as discontinued
operations), as well as a $9.568 billion Goodwill impairment charge based on the
results of its fourth quarter of 2008 goodwill impairment testing. The goodwill
impairment charge was recorded in North America Consumer Banking, Latin
America Consumer banking and EMEA Consumer Banking. During 2008, the
Company benefited from substantial U.S. government financial involvement,
including (i) raising an aggregate $45 billion in capital through the sale of
Citigroup non-voting perpetual, cumulative preferred stock and warrants to
purchase common stock to the U.S. Department of the Treasury (UST), (ii)
entering into a loss-sharing agreement with various U.S. government entities
covering $301 billion of Company assets, and (iii) issuing $5.75 billion of senior
unsecured debt guaranteed by the Federal Deposit Insurance Corporation (FDIC)
(in addition to $26.0 billion of commercial paper and interbank deposits of
Citigroup’s subsidiaries guaranteed by the FDIC outstanding as of December 31,
2008). In connection with these programs and agreements, Citigroup is required
to pay consideration to the U.S. government, including in the form of dividends
on the preferred stock and other fees. In addition, Citigroup has agreed not to pay
common stock dividends in excess of $0.01 per share per quarter for three years
(beginning in 2009) or to repurchase its common stock without the consent of
U.S. government entities. In addition to the equity issuances to the UST under
TARP, Citigroup raised $32 billion of capital in private and public offerings

59
during 2008. In addition, on January 16, 2009, the Company announced a
realignment, for management and reporting purposes, into two businesses:
Citicorp, primarily comprised of the Company’s Global Institutional Bank and the
Company’s regional consumer banks; and Citi Holdings, primarily comprised of
the Company’s brokerage and asset management business, local consumer finance
business, and a special asset pool. Citigroup believes that the realignment will
optimize the Company’s global businesses for future profitable growth and
opportunities and will assist in the Company’s ongoing efforts to reduce its
balance sheet and simplify its organization. On February 27, 2009, the Company
announced an exchange offer of its common stock for up to $27.5 billion of its
existing preferred securities and trust preferred securities at a conversion price of
$3.25 per share. The U.S. government will match this exchange up to a maximum
of $25 billion of its preferred stock at the same conversion price. These
transactions are intended to increase the Company’s tangible common equity
(TCE) and will require no additional U.S. government investment in Citigroup.
During 2008, the Company also completed 19 strategic divestitures which were
designed to strengthen our franchises. Revenues of $52.8 billion decreased 33%
from 2007, primarily driven by significantly lower revenues in ICG due to write-
downs related to subprime CDOs and leveraged lending and other fixed income
exposures. Revenues outside of ICG declined 6%. The Company’s revenues
outside North America declined 4% from 2007. Net interest revenue grew 18%
from 2007, reflecting the lower cost of funds, as well as lower rates outside the
U.S. The lower cost of funds more than offset the decrease in the asset yields
during the year. Net interest margin in 2008 was 3.06%, up 65 basis points from
2007. Excluding the goodwill impairment charge, expenses have declined for four
consecutive quarters, due to lower incentive compensation accruals and continued
benefits from re-engineering efforts. Headcount was down 52,000 from December
31, 2007. The Company’s equity capital base and trust preferred securities were

60
$165.5billion at December 31, 2008. Stockholders’ equity increased by $28.2
billion during 2008 to $141.6 billion, which was affected by capital issuances
discussed above, and the distribution of $7.6 billion in dividends to common and
preferred shareholders. Citigroup maintained its “well capitalized” position with a
Tier 1 Capital Ratio of 11.92% at December 31, 2008. Total credit costs of $33.3
billion included NCLs of $19.0 billion, up from $9.9 billion in 2007, and a net
build of $14.3 billion to credit reserves. The build consisted of $10.8 billion in
Consumer ($8.2 billion in North America and $2.6 billion in regions outside
North America), $3.3 billion in ICG and $249 million in GWM. The Consumer
loan loss rate was 3.75%, a 149 basis-point increase from the fourth quarter of
2007. Corporate cash-basis loans were $9.6 billion at December 31, 2008, an
increase of $7.8 billion from year-ago levels. This increase is primarily
attributable to the transfer of non-accrual loans from the held-for-sale portfolio to
the held-for-investment portfolio during the fourth quarter of 2008. The allowance
for loan losses totaled $29.6 billion at December 31, 2008, a coverage ratio of
4.27% of total loans. The effective tax rate (benefit) of (39)% in 2008 primarily
resulted from the pretax losses in the Company’s Securities and Banking business
taxed in the U.S. (the U.S. is a higher tax-rate jurisdiction). In addition, the tax
benefits of permanent differences, including the tax benefit for not providing U.S.
income taxes on the earnings of certain foreign subsidiaries that are indefinitely
invested, favorably affected the Company’s effective tax rate. At December 31,
2008, the Company had increased its structural liquidity (equity, long-term debt
and deposits) as a percentage of assets from 62% at December 31, 2007 to
approximately 66% at December 31, 2008. Citigroup has continued its
deleveraging, reducing total assets from $2,187 billion at December 31, 2007 to
$1,938 billion at December 31, 2008. At December 31, 2008, the maturity profile
of Citigroup’s senior long-term unsecured borrowings had a weighted average
maturity of seven years. Citigroup also reduced its commercial paper program

61
from $35 billion at December 31, 2007 to $29 billion at December 31, 2008.
Recently, Robert Rubin, Sir Win Bischoff and Roberto Hernández Ramirez
announced they would not stand for re-election at Citigroup’s 2009 Annual
Meeting of Stockholders. On February 23, 2009, Richard Parsons became the
Chairman of the Company.

OUTLOOK FOR 2009

We enter the challenging environment of 2009 after a difficult and

disappointing 2008. While numerous risks remain, the Company has made
progress in decreasing the risks arising from its balance sheet and building capital
to generate future earnings. As examples, and as more fully disclosed throughout
this MD&A:
• Our total allowance for loan losses was $29.6 billion at December 31, 2008;
• As part of the decreasing of risks, we completed the loss-sharing agreement with
various U.S. government entities, which provides significant downside protection
against losses on $301 billion of assets; and
• We have reclassified certain assets from mark-to-market classification to held-to
maturity which could provide some reduction in earnings volatility.

Changes to Citi’s Organizational Structure

On January 16, 2009, given the economic and market environment, Citi
announced the acceleration of the implementation of its strategy to focus on its
core businesses. As a result of its proposed realignment, Citigroup will be

62
comprised of two businesses, Citicorp and Citi Holdings. Citigroup believes that
the realignment will optimize the Company’s global businesses for future
profitable growth and opportunities and will assist in the Company’s ongoing
efforts to reduce its balance sheet and simplify its organization. Citigroup’s plan
is to transition to this structure as quickly as possible, taking into account the
interests of all stakeholders, including customers and clients, debt holders,
preferred and common stockholders, employees, and the communities it serves.
The Company recognizes that major legal vehicle restructuring changes such as
the realignment will require regulatory approvals and the resolution of tax and
other issues. Citigroup has, however, managed the Company consistent with this
structure since February 2009 and management reporting will reflect this structure
starting with the second quarter of 2009.

Citicorp

Citicorp, a global bank for businesses and consumers, will have two
primary underlying businesses: the Global Institutional Bank serving corporate,
institutional, public sector and private banking clients; and Citigroup’s regional
consumer banks which provide traditional banking services, including branded
cards as well as small and middle market commercial banking. It is anticipated
that Citicorp will focus on its unique competitive advantage of having a strong
presence in the fastest-growing areas of the world.

CitiHoldings

Citi Holdings will have three primary segments: brokerage and asset
management, local consumer finance and a special asset pool. Citigroup continues
to believe that many of Citi Holdings’ businesses are attractive long-term

63
businesses with strong market positions, but they do not sufficiently enhance the
capabilities of Citigroup’s core businesses. Citi Holdings will continue to focus on
risk management and credit quality as it seeks to build value in these businesses.

Goals in 2009

• Returning to profitability
• Risk reduction and mitigation
• Implementation and management of TARP and TARP funds
• Expense reduction
• Headcount reduction
• Asset reduction
• Implementing organizational changes/management realignment

Economic Environment

Citigroup’s financial results are closely tied to the global economic

environment. The global markets are experiencing the impact of a significant U.S.
and international economic downturn. This is restricting the Company’s growth
opportunities both domestically and internationally. Should economic conditions
not improve or further deteriorate, the Company could experience continued
revenue pressure across its businesses and increased costs of credit. In addition,
continuing deterioration of the U.S. or global real estate markets could adversely
impact the Company’s revenues, including additional losses on subprime and
other exposures, additional losses on leveraged loan commitments and cost of
credit, including increased credit losses in mortgage-related and other activities.
Further adverse rating actions by credit rating agencies in respect of structured

64
credit products or other credit-related exposures, or of monocline insurers, could
result in revenue reductions in those or similar securities.

Credit Costs
We believe that credit costs are expected to increase during 2009.
• As we go into the first half of 2009, we expect NCLs for our consumer
portfolios could be $1 billion to $2 billion higher each quarter when compared to
the NCLs in the third quarter of 2008. At this time we believe that we will be at
the higher end of this range.
• Our assumption on unemployment is that it could peak as late as the first half of
2010. This implies that we will most likely continue to add to our Consumer
reserves until the end of 2009.

65
• Corporate credit is inherently difficult to predict given the economic
environment. It is expected that corporate loan default rates will increase. As
such, we expect to continue to add to reserves and will likely see higher Corporate
NCLs.

2008 vs. 2007

66
 Net interest revenue increased 16%. Global Cards growth of 13% was
driven by 12% growth in purchase sales and 18% growth in average loans.
Consumer Banking, excluding Consumer Finance Japan (CFJ), grew by 10%,
driven by growth of 6% in average loans and 4% growth in deposits. Transaction
Services exhibited strong growth across all products resulting in 19% growth.
S&B grew 90%, or $966 million, reflecting better spreads during the year and
higher dividend revenue. Growth was also positively impacted by FX translation,
acquisitions and portfolio purchases. Non-interest revenue decreased 43% as S&B
continued to be impacted by market volatility and declining valuations. Outside of
S&B, non-interest revenue decreased 2% due to the absence of gain on Visa
shares compared to the prior year, in Transaction Services and Global Cards.
Excluding this, revenue was flat with strong growth in Global Cards, Transaction
Services and GWM, offset by lower Investment Sales in Consumer Banking and
GWM. Results included a $31 million gain on the sale of DCI, partially offset by a
$21 million gain on the sale of MasterCard shares in the prior year. Growth was
also negatively impacted by foreign exchange, acquisitions and portfolio
purchases. Operating expenses increased 19% reflecting the impact of
acquisitions, a $937 million Nikko Asset Management intangible impairment
charge, theimpact of the strengthening of local currencies and restructuring/
repositioning charges, partially offset by the benefits of reengineering efforts.
Provisions for loan losses and for benefits and claims increased 51% primarily
driven by a $574 million incremental pretax charge to increase loan loss reserves,
increased credit costs in India, acquisitions and portfolio growth. Taxes included a
$994 million tax benefit related to the legal vehicle restructuring of the CFJ
operations.

Asia Excluding CFJ

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As disclosed in the table above, NIR excluding CFJ increased 25% during 2008.
Operating expenses excluding CFJ increased 22% during 2008 and Net Income
excluding CFJ decreased 71%.

FORWARD-LOOKING STATEMENTS

These forward-looking statements are based on management’s current

expectations and involve external risks and uncertainties including, but not
limited. Other risks and uncertainties disclosed herein include, but are not limited
to:
• Levels of activity and volatility in the capital markets;
• 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 impact the elimination of QSPEs from the guidance on SFAS 140 may have
on Citigroup’s consolidated financial statements;
• The difficult environment surrounding the Japan Consumer Finance business
and the way courts will view grey zone claims;
• The effect continued deterioration in the U.S. housing market could have on the
Consumer Banking business’ cost of credit in the first mortgage and second
mortgage portfolios;
• The effect of default rates on the cost of credit;
• The dividending capabilities of Citigroup’s subsidiaries;
• The effect that possible amendments to, and interpretations of, risk-based capital
guidelines and reporting instructions might have on Citigroup’sreported capital
ratios and net risk-weighted assets;

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• The possibility of further adverse rating actions by credit rating agencies in
respect of structured credit products or other credit-related exposures or of
monoline insurers;
• The effectiveness of the hedging products used in connection with Securities
and Banking’s trading positions in U.S. subprime RMBS and related products,
including ABS CDOs, in the event of material changes in market conditions; and
• The outcome of legal, regulatory and other proceedings

Comparison of Five-Year Cumulative Total Return

The following graph compares the cumulative total return on Citigroup’s

common stock with the S&P 500 Index and the S&P Financial Index over the
five-year period extending through December 31, 2008. The graph assumes that
$100 was invested on December 31, 2003 in Citigroup’s common stock, the S&P
500 Index and the S&P Financial Index and that all dividends were reinvested.

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70
Latest news about Citi Bank
Citi Pakistan secures top honors
Citi Pakistan that its trade capabilities received top honors with a total of
19 awards in Euro money’s Trade Finance magazine fifth annual client poll of the
world's best trade banks. Citi was named 'Best Trade Services
Bank' and 'Best short-term Finance Bank' once again this year. Citi was also
named 'Best Export Finance Arranger,' 'Best Forfeiting Institution' and 'Best
Supply Chain Bank' in the highly commended category. Several regional and
country awards were received as well including 'Best Trade Finance Bank in Asia'
for the fourth year in a row. In the countries, 'Best' awards were given to
Indonesia, Korea, Vietnam, Taiwan and Hong Kong and "Highly Commended”
nods went to China, India, Malaysia, Thailand and Singapore, totaling 10
countries wins overall.
Central and Eastern Europe again received the "Highly Commended" award for
Best Trade Finance Bank. And, first time winners, Pakistan and Russia were
awarded "Highly Commended" designations for Best International Trade Bank. ,
Salman Riaz Head of Global' Transactions Services (GTS) at Citi Pakistan said,
"The recognition Citi Pakistan has received in this year's Trade Finance poll
underscores our commitment to our clients and is a reflection of the trust and
confidence they place in us, a fact that makes us very proud indeed." These results
are based on a readers' poll and online voting through Trade Finance's website,
and have become an industry benchmark for institutions in gauging their value
proposition. This year's ballots saw over 12,000 entries throughout the world.
ineffectiveness resulting from the hedging relationship is recorded in current
earnings. Alternatively, an economic hedge, which does not meet the SFAS 133

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hedging criteria, would involve only recording the derivative at fair value on the
balance sheet, with its associated changes in fair value recorded in earnings.
CONCLUSION

In such challenging times it is worth taking stock of what is truly valuable

about Citi. I’m convinced there are some enduring truths that will stand the test of
the coming years.
The first is that our competitive advantage will remain our global presence, which
is rich both in history and in client relationships. At the heart of Citi is an
irreplaceable franchise built over nearly 200 years, with more than 200 million
customer accounts in over 100 countries. Through this unique global network, we
enable people to reach out and to work together across the world. Second, we will
continue to build on our rich legacy of innovation: innovation to ensure that we
can address the needs of a highly mobile population that is increasingly urban and
international in outlook; innovation to help people and companies work more
collaboratively across multiple networks and time zones; innovation to facilitate
new ways of thinking about money and the role it plays in everyday life and
business.

Third, we will remain determined to build a culture of meritocracy where talent is

recognized and rewarded with opportunity, where each employee has a chance to
achieve his/her potential, and where the best do better. Fourth, we’ll continue to
make a difference in the communities where we work and live.

In November, 50,000 Citi colleagues and friends came together in 550 cities
around the world in a single day to repair schools, deliver food, and help people in
need. With so many people now feeling pressure, Citi is more devoted than ever
to improving society and the environment in the communities where we work

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through our philanthropy, volunteerism, public policy engagement, and our core
business activities. Every Citi employee is acutely aware of the challenges ahead.
We all know people whose economic struggles are unprecedented and
overwhelming. It is our commitment to Citi’s customers, shareholders, and
employees to create solutions that mitigate the impact of these difficult times.
With the top team in the industry, we will succeed

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Bibliography
http://www.citi.com/pakistan.
www.google.com
www.citibank.com

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REFERENCES

Mr. Amir Ali Mehdi (Collection Head, North)

Mr. Tanveer Bashir (Management & Analytical unit, Lahore)
Mr. Abrar Najeeb (Management & Analytical unit, Lahore)
Miss Habiba Butt (HR coordinator Lahore)
Mr. Kashif Salahuddin (Manager AUTOS Collection)
Mr. Numan (Shop Coordinator)
Mr. Shehbaz (Shop Coordinator)

1. FINANCIAL DEPARTMENT CITI BANK KARACHI

2. HUMAN RESOURCE DEPARTMENT CITI BANK KARACHI
3. MANAGEMENT AND ANALYTICAL UNIT LAHORE MAIN
BRANCH
4. GARDEN TOWN CITI BANK BRANCH
5. COLLECTION DEPARTMENT LAHORE

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