Citibank 2014 Annual Report Download - page 173

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Sale of Egg Banking plc Credit Card Business
In April 2011, Citi completed the sale of the Egg Banking plc (Egg) credit
card business. Summarized financial information for Discontinued
operations for the operations related to Egg follows:
In millions of dollars 2014 2013 2012
Total revenues, net of interest expense (1) $ 5 $ — $ 1
Income (loss) from discontinued operations $(46) $(62) $ (96)
Gain (loss) on sale —— (1)
Provision (benefit) for income taxes (16) (22) (34)
Income (loss) from discontinued
operations, net of taxes $(30) $(40) $ (63)
(1) Total revenues include gain or loss on sale, if applicable.
Cash flows from Discontinued operations related to Egg were not
material for all periods presented.
Audit of Citi German Consumer Tax Group
Citi sold its German retail banking operations in 2007 and reported them
as Discontinued operations. During the third quarter of 2013, German
tax authorities concluded their audit of Citi’s German consumer tax group
for the years 2005-2008. This resolution resulted in a pretax benefit of
$27 million and a tax benefit of $57 million ($85 million total net income
benefit) during the third quarter of 2013, all of which was included in
Discontinued operations. During 2014, residual costs associated with
German retail banking operations resulted in a tax expense of $20 million.
Combined Results for Discontinued Operations
The following is summarized financial information for Credicard, CCA, Egg
and previous Discontinued operations for which Citi continues to have
minimal residual costs associated with the sales:
In millions of dollars 2014 2013 2012
Total revenues, net of interest expense (1) $74 $1,086 $1,106
Income (loss) from discontinued operations $10 $ (242) $ (109)
Gain on sale —268 (1)
Provision (benefit) for income taxes 12 (244) (52)
Income (loss) from discontinued
operations, net of taxes $ (2) $ 270 $ (58)
(1) Total revenues include gain or loss on sale, if applicable.
Cash Flows from Discontinued Operations
In millions of dollars 2014 2013 2012
Cash flows used in operating activities $— $ 154 $(209)
Cash flows from investing activities —(207) 199
Cash flows from financing activities —43 16
Net cash provided by discontinued operations $— $ (10) $ 6
Significant Disposals
The following sales were identified as significant disposals, including the
assets and liabilities that were reclassified to held-for-sale within Other assets
and Other liabilities on the Consolidated Balance Sheet and the Income
(loss) before taxes (benefits) related to each business.
Agreement to Sell Japan Retail Banking Business
On December 25, 2014, Citi entered into an agreement to sell its Japan
retail banking business that will be reported as part of Citi Holdings effective
January 1, 2015. The sale, which is subject to regulatory approvals and other
customary closing conditions, is expected to occur by the fourth quarter of
2015 and result in an after-tax gain upon completion. Income before taxes
for the period in which the individually significant component was classified
as held-for-sale and for all prior periods are as follows:
In millions of dollars 2014 2013 2012
Income before taxes $(5) $31 $(4)
The following assets and liabilities for the Japan retail banking business
were identified and reclassified to held-for-sale within Other assets and
Other liabilities on the Consolidated Balance Sheet at December 31, 2014:
In millions of dollars December 31, 2014
Assets
Cash and deposits with banks $ 151
Loans (net of allowance of $2 million) 544
Goodwill 51
Other assets, advances to/from subs 19,854
Other assets 66
Total assets $20,666
Liabilities
Deposits $20,605
Other liabilities 61
Total liabilities $20,666