Citibank 2012 Annual Report Download - page 241

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20. REGULATORY CAPITAL AND CITIGROUP INC.
PARENT COMPANY INFORMATION
Citigroup is subject to risk-based capital and leverage guidelines issued by
the Federal Reserve System (FRB). Citi’s U.S. insured depository institution
subsidiaries, including Citibank, N.A., are subject to similar guidelines issued
by their respective primary federal bank regulatory agencies. These guidelines
are used to evaluate capital adequacy and include the required minimums
shown in the following table. The regulatory agencies are required by law
to take specific prompt actions with respect to institutions that do not meet
minimum capital standards.
The following table sets forth Citigroup’s and Citibank, N.A.’s regulatory
capital ratios as of December 31, 2012:
In millions of dollars
Required
minimum
Well-
capitalized
minimum Citigroup Citibank, N.A.
Tier 1 Common $123,095 $116,633
Tier 1 Capital 136,532 117,367
Total Capital (1) 167,686 135,513
Tier 1 Common ratio N/A N/A 12.67% 14.12%
Tier 1 Capital ratio 4.0% 6.0% 14.06 14.21
Total Capital ratio 8.0 10.0 17.26 16.41
Leverage ratio 3.0 5.0 (2) 7.48 8.97
(1) Total Capital includes Tier 1 Capital and Tier 2 Capital.
(2) Applicable only to depository institutions.
N/A Not Applicable
As indicated in the table above, Citigroup and Citibank, N.A. were well
capitalized under the current federal bank regulatory definitions as of
December 31, 2012.
Banking Subsidiaries—Constraints on Dividends
There are various legal limitations on the ability of Citigroup’s subsidiary
depository institutions to extend credit, pay dividends or otherwise supply
funds to Citigroup and its non-bank subsidiaries. The approval of the Office
of the Comptroller of the Currency is required if total dividends declared
in any calendar year exceed amounts specified by the applicable agency’s
regulations. State-chartered depository institutions are subject to dividend
limitations imposed by applicable state law.
In determining the dividends, each depository institution must also
consider its effect on applicable risk-based capital and leverage ratio
requirements, as well as policy statements of the federal regulatory agencies
that indicate that banking organizations should generally pay dividends out
of current operating earnings. Citigroup received $19.1 billion in dividends
from Citibank, N.A. in 2012.
Non-Banking Subsidiaries
Citigroup also receives dividends from its non-bank subsidiaries. These
non-bank subsidiaries are generally not subject to regulatory restrictions
on dividends.
The ability of CGMHI to declare dividends can be restricted by capital
considerations of its broker-dealer subsidiaries.
In millions of dollars
Subsidiary Jurisdiction
Net
capital or
equivalent
Excess over
minimum
requirement
Citigroup Global Markets Inc. U.S. Securities and
Exchange
Commission
Uniform Net
Capital Rule
(Rule 15c3-1) $6,250 $5,659
Citigroup Global Markets Limited United Kingdom’s
Financial
Services
Authority $6,212 $3,594