Citibank 2014 Annual Report Download - page 3

Letter to Shareholders
Let me now review our firm’s progress in 2014 toward each
of these goals and also update you on other important
achievements — as well as some setbacks — of the year.
There is no question that we have made strong progress
on the first two goals. Our deferred tax assets — crisis-era
write-offs against future earnings — will not be going away
anytime soon. But we have shown that we can utilize these
assets on a consistent basis, and at higher levels than many
predicted or expected, generating additional regulatory
capital. In utilizing $3.3 billion of our deferred tax assets
in 2014, we exceeded 2013’s level by $800 million and now
have utilized $5.8 billion in the last two years.
Regarding the second goal, we worked hard to drive Citi
Holdings to break-even by 2015 and did so in 2014, sooner
than even I expected. While there may be fluctuations from
quarter to quarter, we are committed to keeping Holdings at
or slightly better than break-even for the foreseeable future.
Additionally, in 2014 we reduced Holdings’ assets by a further
16%, driven by ongoing run-off and asset sales. During the
course of last year, we also took important steps toward the
sale of OneMain — which we announced recently and expect
Michael L. Corbat
Chief Executive Officer
Dear Fellow Shareholders,
2014 was for Citi an important chapter in a multi-year story
of radical, yet thoughtful and prudent, transformation of
the size, scope and structure of our firm. It was also a year
of challenges — that much is obvious — and significant
accomplishment, which may not seem quite so evident.
Yet if we step back and view the year in context, we can see
how far our company has come in a short time.
By virtually any measure, Citi is a stronger, safer, simpler and
smaller institution than it was before, during or just after
the financial crisis — and even compared with two years ago
when I assumed the role of CEO.
It’s a vast understatement to say that we merely “rebuilt” our
capital position since the crisis. In fact, our capital strength
now far exceeds even pre-crisis levels, with nearly $140
billion in regulatory capital and a Tier 1 Common capital ratio
of 10.6%. And we hold more than $400 billion in high-quality
liquid assets.
That Citi is also smaller and simpler can be seen through
many metrics. Our headcount now stands at 241,000 — down
from a peak of 375,000. We’ve shed more than 60 non-core
businesses. Our balance sheet is smaller and consists of
higher quality assets. Assets in Citi Holdings — which once
topped $700 billion — are now below $100 billion. And we’ve
shrunk the number of our legal entities to further simplify
our structure and governance.
In short, today’s Citi is not the bank that entered, endured, or
emerged from the financial crisis. It’s a very different firm —
one that has returned to its roots as the world’s most global
consumer, commercial and institutional bank, a trusted
partner of choice for multinationals and globally-minded
customers who do business in every time zone.
When I took over as CEO, my overarching goal was — and
remains — to build on this progress, to position our firm to
realize the full value of our network and all its potential. To that
end, I set four specific goals for Citi: first, to utilize our deferred
tax assets; second, to drive Citi Holdings to break-even; third,
to generate quality and consistent earnings; and fourth, to be
known as an indisputably strong and stable institution.
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