Citibank 2007 Annual Report Download - page 5

and strategy. My goal is to have the best risk management in
the business, to transform it into a key competitive advantage
driving bottom-line results.
A key component of excellence in capital allocation is asset
productivity. We are eliminating low-return, nonstrategic
assets that do not support our growth strategy. During
the fourth quarter, we decreased assets by $176 billion, the
rst time in six years that we saw a reduction in Generally
Accepted Accounting Principles (GAAP) assets on a continu-
ing operations basis. This strategy began in the third quarter;
since then we have reduced our positions in mortgage-backed
securities in the U.S. lending business, decreased low-
returning assets in our Markets & Banking business, divested
Nikko Cordial’s Simplex Investment Advisors, and sold a
portion of our stake in Redecard.
We have also ensured that our subprime-related exposures
in Securities and Banking are being managed actively and
separately. As these assets mature or are sold, that capital
will be redirected to higher-return opportunities to drive
shareholder value in the future. We are applying the same
strategy in an ongoing way to segregate other low-returning
assets from those that will increase our earnings power.
n Operations. Core to our priorities are strong expense
management and the ability to execute productively against
our plans. Chief Financial Ofcer Gary Crittenden is leading
our efforts in reengineering and expense management to
make Citi simpler, leaner, and more efcient. Reengineering
has been established as an ongoing process embedded in our
operating culture.
n Client relationships. Citi has been serving clients since 1812.
Our goal is to make nancial matters better and easier for
them in every way that we can. The marketplace is becoming
ever more complex, a situation which encourages a deepening
interdependency between Citi and its clients. During our
business reviews I have found it incredibly gratifying to see the
depth of relationships that Citi enjoys around the world. The
company’s rich and enduring history has enabled global
partnerships that remain strong over time, and we will continue
to augment and prize them as we go forward.
n Technology. Key to deepening our client relationships will be
the benets of emerging technology. As we respond quicker,
communicate more effectively, simplify transactions, and
innovate faster, we will be able to drive superior service to our
clients across the globe. The more we harness emerging
technologies, the easier it will be for our clients to work with
us. As our clients increasingly incorporate technology into their
nancial routines, Citi will be positioned to capitalize on this by
building on our deep history of technological innovation.
Our longstanding presence in growing markets abroad has
allowed us to build a huge repository of information. Our
innovations in technology let us better take advantage of our
size and scope. As Walter Wriston, the longtime chairman of
Citicorp in the 1970s, said, “Information about money is as
important as money itself.” By sharing insights and ideas
across borders, we create protable synergies among our
business segments and ultimately drive down costs.
n Talent. The difference between success and failure in nancial
services is the quality of the people who work with our
clients. Citi has the single largest pool of talent in the
nancial services business. We must manage that talent even
more effectively by rewarding demonstrated performance
and by putting the right people in the right positions. I have
appointed a Chief Talent Ofcer who is mandated to nd,
track, and deploy the best talent. Our goal is to empower our
business leaders and create a more demanding performance-
management system to instill a meritocracy at every level. By
encouraging respect, teamwork, and a supportive culture that
drives excellence in performance, we want Citi to be the
nancial services industry’s employer of choice.
While we approach 2008 with tempered optimism, there are
global economic realities that we cannot ignore. As a worldwide
business, Citi’s nancial results are closely tied to the global
economic environment, and we see a risk of a U.S. and/or a
global downturn in 2008. My decisions and actions will
continue to be rmly rooted in accountability to you, our
owners, and we will continue to be candid about both our
successes and our setbacks.
Before closing, I’d like to thank the board members for their
support. They have been extraordinary in their dedication and
efforts to strengthen the company. The power of the Citi brand
is unparalleled in the world, and each of us is personally proud
to represent that brand every day. Although these are
challenging times in the nancial markets, Citi is a strong
franchise unmatched in scale, expertise, or talent. I have been
inspired by the commitment of our people and the support
from our clients. I look forward to leading this great company
into the future.
Vikram Pandit
Chief Executive Ofcer, Citigroup Inc.