Citibank 2011 Annual Report Download - page 205

183
13. BROKERAGE RECEIVABLES AND BROKERAGE
PAYABLES
The Company has receivables and payables for financial instruments
purchased from and sold to brokers, dealers and customers, which arise in
the ordinary course of business. The Company is exposed to risk of loss from
the inability of brokers, dealers or customers to pay for purchases or to deliver
the financial instruments sold, in which case the Company would have to
sell or purchase the financial instruments at prevailing market prices. Credit
risk is reduced to the extent that an exchange or clearing organization acts
as a counterparty to the transaction and performs for the broker, dealer or
customer in question.
The Company seeks to protect itself from the risks associated with
customer activities by requiring customers to maintain margin collateral
in compliance with regulatory and internal guidelines. Margin levels are
monitored daily and customers deposit additional collateral as required.
Where customers cannot meet collateral requirements, the Company will
liquidate sufficient underlying financial instruments to bring the customer
into compliance with the required margin level.
Exposure to credit risk is impacted by market volatility, which may impair
the ability of clients to satisfy their obligations to the Company. Credit limits
are established and closely monitored for customers and for brokers and
dealers engaged in forwards, futures and other transactions deemed to be
credit sensitive.
Brokerage receivables and brokerage payables consisted of the following at
December 31:
In millions of dollars 2011 
2ECEIVABLESæFROMæCUSTOMERS $19,991 
2ECEIVABLESæFROMæBROKERSæDEALERSæANDæCLEARINGæORGANIZATIONS 7,786 
Total brokerage receivables (1) $27,777 
0AYABLESæTOæCUSTOMERS $40,111 
0AYABLESæTOæBROKERSæDEALERSæANDæCLEARINGæORGANIZATIONS 16,585 
Total brokerage payables (1) $56,696 
æ "ROKERAGEæRECEIVABLESPAYABLESæAREæREPORTEDæNETæBYæCOUNTERPARTYæWHENæAPPLICABLEæREQUIREMENTSæFORæ
NETæPRESENTATIONæAREæMET
14. TRADING ACCOUNT ASSETS AND LIABILITIES
Trading account assets and Trading account liabilities, at fair value,
consisted of the following at December 31:
In millions of dollars 2011 
Trading account assets
-ORTGAGEBACKEDæSECURITIESæ
53æGOVERNMENTSPONSOREDæAGENCYæGUARANTEED $ 27,535  
0RIME 877 
!LT! 609 
3UBPRIME 989 
.ON53æRESIDENTIAL 396 
#OMMERCIAL 2,333 
4OTALæMORTGAGEBACKEDæSECURITIES $ 32,739  
53æ4REASURYæANDæFEDERALæAGENCYæSECURITIES
53æ4REASURY $ 18,227  
!GENCYæOBLIGATIONS 1,172 
4OTALæ53æ4REASURYæANDæFEDERALæAGENCYæSECURITIES $ 19,399  
3TATEæANDæMUNICIPALæSECURITIES $ 5,364  
&OREIGNæGOVERNMENTæSECURITIES 79,551 
#ORPORATE 37,026 
$ERIVATIVESæ 62,327 
%QUITYæSECURITIES 33,230 
!SSETBACKEDæSECURITIESæ 7,071 
/THERæDEBTæSECURITIES 15,027 
Total trading account assets $291,734 
Trading account liabilities
3ECURITIESæSOLDæNOTæYETæPURCHASED $ 69,809  
$ERIVATIVESæ 56,273 
Total trading account liabilities $126,082 
æ 4HEæ#OMPANYæINVESTSæINæMORTGAGEBACKEDæANDæASSETBACKEDæSECURITIESæ4HESEæSECURITIZATIONSæAREæ
GENERALLYæCONSIDEREDæ6)%Sæ4HEæ#OMPANYSæMAXIMUMæEXPOSUREæTOæLOSSæFROMæTHESEæ6)%SæISæEQUALæTOæ
THEæCARRYINGæAMOUNTæOFæTHEæSECURITIESæWHICHæISæREFLECTEDæINæTHEæTABLEæABOVEæ&ORæMORTGAGEBACKEDæ
ANDæASSETBACKEDæSECURITIZATIONSæINæWHICHæTHEæ#OMPANYæHASæOTHERæINVOLVEMENTæSEEæ.OTEææTOæTHEæ
#ONSOLIDATEDæ&INANCIALæ3TATEMENTS
æ 0RESENTEDæNETæPURSUANTæTOæMASTERæNETTINGæAGREEMENTSæ3EEæ.OTEææTOæTHEæ#ONSOLIDATEDæ&INANCIALæ
3TATEMENTSæFORæAæDISCUSSIONæREGARDINGæTHEæACCOUNTINGæANDæREPORTINGæFORæDERIVATIVES