Citibank 2008 Annual Report Download - page 22

Latin America
Acquisition of Grupo Financiero Uno
In 2007, Citigroup completed its acquisition of Grupo Financiero Uno
(GFU), the largest credit card issuer in Central America, and its affiliates,
with $2.2 billion in assets. The results for GFU are included in Citigroup’s
Global Cards and Latin America Consumer Banking businesses from
March 5, 2007 forward.
Acquisition of Grupo Cuscatlán
In 2007, Citigroup completed the acquisition of the subsidiaries of Grupo
Cuscatlán for $1.51 billion ($755 million in cash and 14.2 million shares of
Citigroup common stock) from Corporacion UBC Internacional S.A. Grupo.
The results of Grupo Cuscatlán are included from May 11, 2007 forward and
are recorded in Latin America Consumer Banking.
Asia
Acquisition of Bank of Overseas Chinese
In 2007, Citigroup completed its acquisition of Bank of Overseas Chinese
(BOOC) in Taiwan for approximately $427 million. Results for BOOC are
included in Citigroup’s Asia Consumer Banking, Global Cards and
Securities and Banking businesses from December 1, 2007 forward.
EMEA
Acquisition of Quilter
In 2007, the Company completed the acquisition of Quilter, a U.K. wealth
advisory firm, from Morgan Stanley. Quilter’s results are included in
Citigroup’s Smith Barney business from March 1, 2007 forward. Quilter is
being disposed of as part of the sale of Smith Barney to Morgan Stanley
described in Subsequent Events.
Acquisition of Egg
In 2007, Citigroup completed its acquisition of Egg Banking plc (Egg), a
U.K. online financial services provider, from Prudential PLC for
approximately $1.39 billion. Results for Egg are included in Citigroup’s
Global Cards and EMEA Consumer Banking businesses from May 1, 2007
forward.
Purchase of 20% Equity Interest in Akbank
In 2007, Citigroup completed its purchase of a 20% equity interest in Akbank,
the second-largest privately owned bank by assets in Turkey for
approximately $3.1 billion. This investment is accounted for using the equity
method of accounting.
Sabanci Holding, a 34% owner of Akbank shares, and its subsidiaries have
granted Citigroup a right of first refusal or first offer over the sale of any of
their Akbank shares in the future. Subject to certain exceptions, including
purchases from Sabanci Holding and its subsidiaries, Citigroup has otherwise
agreed not to increase its percentage ownership in Akbank.
OTHER ITEMS
Sale of MasterCard Shares
In 2007, the Company recorded a $367 million after-tax gain ($581 million
pretax) on the sale of approximately 4.9 million MasterCard Class B shares
that had been received by Citigroup as a part of the MasterCard initial public
offering completed in June 2006. The gain was recorded in the following
businesses:
In millions of dollars
2007
Pretax
total
2007
After-tax
total
2006
Pretax
total
2006
After-tax
total
Global Cards $466 $296 $ 94 $59
Consumer Banking 96 59 27 18
ICG 19 12 2 1
Total $581 $367 $123 $78
Redecard IPO
In 2007, Citigroup (a 31.9% shareholder in Redecard S.A., the only merchant
acquiring company for MasterCard in Brazil) sold approximately
48.8 million Redecard shares in connection with Redecard’s initial public
offering in Brazil. Following the sale of these shares, Citigroup retained
approximately 23.9% ownership in Redecard. An after-tax gain of
approximately $469 million ($729 million pretax) was recorded in
Citigroup’s 2007 financial results in the Global Cards business.
Visa Restructuring and Litigation Matters
In 2007, Visa USA, Visa International and Visa Canada were merged into Visa
Inc. (Visa). As a result of that reorganization, Citigroup recorded a $534
million (pretax) gain on its holdings of Visa International shares primarily
recognized in the Consumer Banking business. The shares were then
carried on Citigroup’s balance sheet at the new cost basis. In addition,
Citigroup recorded a $306 million (pretax) charge related to certain of Visa
USA’s litigation matters primarily recognized in the North America
Consumer Banking business.
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