SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Date of Report (Date of earliest event reported): April 19,
1994
CITICORP
(Exact name of registrant as specified in charter)
Delaware 1-5738 13-2614988
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
399 Park Avenue, New York, New York 10043
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code: (212)559-1000
Not Applicable
(Former name or former address, if changed since last report)
Item 5. Other Events
On April 19, 1994 Citicorp reported operating earnings of
$609 million, or $1.12 per common share fully diluted, in the
first quarter of 1994. These results were up from $370 million,
or $0.67 per share, in the same year-earlier quarter.
Including the cumulative effect of adopting the new
accounting standard for postemployment benefits, net income was
$553 million, or $1.01 per common share fully diluted. In the
year-earlier quarter, including the cumulative effect of a new
accounting method for income taxes, net income was $670 million,
or $1.24 per common share fully diluted.
John S. Reed, Chairman, said: "We had a good quarter. Our
strong emerging markets businesses, continued good operating
expense management, and significant improvement in credit costs
more than offset weak trading results."
Revenues, adjusted for credit-related costs, the effect of credit
card securitization and nonrecurring asset sales, declined by
approximately $100 million to $4.1 billion from the 1993 first
quarter; trading declined by $386 million to $71 million while
all other revenues increased by $269 million or 7%, chiefly in
businesses in emerging markets. Adjusted operating expenses at
$2.4 billion were approximately even with the 1993 first quarter
- -- despite increased spending for continued business expansion
in emerging countries -- and an improvement of $180 million from
the 1993 fourth quarter.
Both commercial and consumer credit costs declined.
Commercial credit costs decreased for the ninth straight quarter,
to $60 million from $126 million in the 1993 fourth quarter and
from $380 million in the 1993 first quarter. Commercial cash-
basis loans and Other Real Estate Owned together dropped by $319
million in the quarter to $5.0 billion. Consumer credit costs
declined to $614 million in the quarter from $651 million in the
1993 fourth quarter and from $716 million in the 1993 first
quarter.
First quarter earnings included a net pretax gain from asset
sales of $23 million ($14 million after tax). Net gains on asset
sales for the same 1993 quarter were $75 million pretax ($41
million after tax).
The company further strengthened its balance sheet during
the quarter by building commercial and consumer loan loss
reserves by $100 million to $4.2 billion, compared with $3.7
billion a year ago. The reserve for the cross-border refinancing
portfolio was unchanged from the 1993 year-end total of $238
million after a pretax release to earnings of $34 million.
Total regulatory capital was increased to $23.5 billion, up $2.5
billion from $21.0 billion a year ago.
Citicorp estimated that its Tier 1 capital ratio increased to
6.8% at quarter-end from 6.6% at December 31, 1993, and its
combined Tier 1 and Tier 2 capital ratio remained unchanged from
11.5% at year-end 1993. A year ago the Tier 1 ratio was 5.2% and
the combined ratio was 10%.
In adopting Statement of Financial Accounting Standards (SFAS)
No. 112 (accounting for postemployment benefits) as of January 1,
1994, Citicorp took an after-tax charge of $56 million as the
cumulative effect of the new standard.
Also in the quarter, Citicorp adopted SFAS No. 115
(accounting for certain investments in securities), which
increased stockholders' equity by $227 million after tax at March
31, 1994, and Interpretation No. 39 (covering reporting of off-
balance sheet contracts), which increased assets and liabilities
by approximately $15 billion at March 31. (Neither of these two
accounting changes affected the company's earnings or its Tier 1
and Tier 2 capital ratios, but they have the effect of reducing
return ratios.)
RESULTS OF BUSINESS OPERATIONS
Global Consumer
Net income in the Global Consumer businesses increased 44%
to a record $427 million in the quarter, compared with $296
million in the 1993 first quarter. The improvement was due to
strong revenues in the emerging economies and private banking
activities as well as to lower credit losses in the U.S.
businesses.
Net income from the consumer businesses in North America,
Europe and Japan was $256 million, compared with $154 million in
the year-earlier quarter. Net income from consumer businesses in
the emerging economies was $171 million, compared with $142
million in the same 1993 quarter.
Adjusted revenues of $2.8 billion were 6% higher than in the
1993 first quarter, with revenues from the emerging economies up
19% and those from North America, Europe and Japan up slightly,
chiefly from strong private banking activity.
Consumer expenses in the quarter were $1.5 billion, a 5%
rise from a year ago, primarily in emerging markets.
Credit costs of $614 million, adjusted for the effect of
credit card securitization, fell by $102 million from the 1993
first quarter and $37 million from last year's fourth
quarter -- their lowest level since 1990. Net credit losses
continued to decline from the 1993 fourth quarter in the U.S.
credit card portfolio, with improvement also noted in U.S.
branches. Consumer loans on the balance sheet that are
delinquent 90 days or more were $3.5 billion at the quarter-end,
down from $3.9 billion a year earlier and virtually unchanged
from the 1993 year-end.
Global Finance
Global Finance businesses earnings were $264 million for the
first quarter, compared with $380 million for the same 1993
quarter.
The businesses in North America, Europe and Japan earned $86
million for the quarter, while businesses in the emerging
economies earned $178 million. These results compared with $233
million and $147 million, respectively, in the year-ago quarter.
Global Finance adjusted revenues were $1.2 billion, an 18%
decline from the same 1993 quarter and 23% lower than the fourth
quarter of 1993. Revenues from trading-related activities for
the quarter were substantially lower compared with both periods
of the prior year. Interest rate and currency environments in
Europe and North America were volatile, and market prices
declined in Latin American securities. Global Finance revenues
excluding trading, however, remained strong, with good gains from
emerging countries.
Operating expenses were lower by 4% and 7% compared with the
first and fourth quarters of 1993, respectively. Expenses for
the 1993 fourth quarter reflected higher incentive compensation
related to trading activity and for the year-ago quarter included
a pretax charge of $64 million ($35 million after tax) for
withdrawal from the portfolio management business for customers
in India.
In the quarter, Global Finance recoveries, chiefly in North
America and Europe, exceeded write-offs by $46 million. In
addition, other positive credit-related items in the quarter
totaled $12 million. These contrasted with credit costs in the
1993 first quarter of $69 million. Cash-basis loans of $699
million compared with $1.3 billion a year ago and $755 million at
the end of 1993.
North America Commercial Real Estate
North America Commercial Real Estate reported continued
improvement in its portfolio. Cash-basis loans and OREO declined
to $3.8 billion at the end of the quarter, an improvement of $1.8
billion and $267 million, respectively, from the first and fourth
quarters of 1993. The reduction was due to multiple initiatives,
including restructurings, sales, paydowns, writeoffs and
writedowns.
Cash-basis loans of $1.7 billion were down from $2.6 billion
at the end of the 1993 first quarter and even with $1.7 billion
at year-end 1993. OREO property decreased to $2.1 billion from
$3.0 billion a year ago and from $2.3 billion at year-end 1993.
Consistent with the reduction of problem credits in the North
America Commercial Real Estate portfolio, its total exposure was
reduced $900 million during the quarter to $12.7 billion -- down
from $16.5 billion at the end of the 1993 first quarter.
North America Commercial Real Estate reported a net loss of
$76 million, a sharp reduction from a $204 million loss in the
1993 first quarter, due to lower credit costs. Net write-offs
and writedowns declined to $104 million, compared with $260
million in the same 1993 quarter.
Cross-Border Refinancing Portfolio
The cross-border refinancing portfolio reported net income
of $49 million, reflecting the release of $34 million of
reserves; net income in the same 1993 quarter amounted to $37
million, when there was no release of reserves. The first-
quarter results included the recognition of $22 million of
interest from Brazil, compared with $42 million in the year-ago
quarter.
On April 15, 1994 the Government of Brazil completed its
external-debt financing package covering essentially all of its
medium- and long-term commercial-bank debt. Citicorp exchanged
approximately $2.7 billion in face value of Brazilian debt for
$1.3 billion of Debt Conversion Bonds, $1.2 billion of Front
Loaded Interest Reduction Bonds, $122 million of New Money Bonds
and $60 million of Investment Feature Cruzeiro Bonds. In
addition, Citicorp purchased $221 million of New Money Bonds and
has received $274 million of an expected total of approximately
$325 million in bonds covering past due interest.
In March the Government of Poland and its Bank Advisory
Committee reached a preliminary agreement on a financing package,
and negotiations are underway between the Governments of Panama
and Ecuador and their bank committees.
TAXES
The effective tax rate in the quarter was 39%, down from 45%
in the 1993 first quarter.
Following are tables of financial highlights, an analysis of
operating margin pretax earnings, business results and credit
indicators are available on request, along with financial
statements. Further details concerning the financial results
will be available in May in Citicorp's Form 10-Q.
KEY RATIOS & OTHER CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
First Quarter
1994 1993
----- -----
<S> <C> <C>
NET INCOME ($M):
Before Cumulative Effect
of Accounting Changes.................. $ 609 $ 370
After Cumulative Effect
of Accounting Changes(A)............... $ 553 $ 670
NET INCOME PER COMMON SHARE:
On Common & Common
Equivalent Shares
Before Cumulative Effect
of Accounting Changes.................. $ 1.24 $ 0.71
After Cumulative Effect
of Accounting Changes(A)............... $ 1.11 $ 1.38
Assuming Full Dilution
Before Cumulative Effect
of Accounting Changes.................. $ 1.12 $ 0.67
After Cumulative Effect
of Accounting Changes(A)............... $ 1.01 $ 1.24
COMMON STOCKHOLDERS' EQUITY PER SHARE(B). $27.90 $23.21
CLOSING STOCK PRICE
AT QUARTER END.......................... $37.50 $29.50
PROFITABILITY RATIOS (Annualized):
Return on Total Assets(C):
Before Accounting Changes............... 0.98% 0.67%
After Accounting Changes(A)............. 0.95% 0.80%
Return on Common Stockholders' Equity(B):
Before Accounting Changes............... 20.1% 14.3%
After Accounting Changes(A)............. 19.5% 17.9%
Return on Total Stockholders' Equity(B):.
Before Accounting Changes............... 17.1% 12.9%
After Accounting Changes(A)............. 16.7% 15.5%
CAPITAL:
Tier 1 ($B)............................. $ 13.9 $ 10.9
Tier 1 & 2 ($B)(D)...................... $ 23.5 $ 21.0
Tier 1 Ratio (D)........................ 6.8% 5.2%
Tier 1 & 2 Ratio(D)..................... 11.5% 10.0%
Common Equity as a
% of Total Assets(B)(C)............... 4.5% 4.0%
Total Equity as a
% of Total Assets(B)(C)............... 6.1% 5.5%
DIVIDENDS DECLARED ($M):
Preferred............................. $ 87 $ 73
(A) First quarter 1994 includes the cumulative effect of adopting
Statement of Financial Accounting Standards No. 112,
"Employers' Accounting for Postemployment Benefits", as of
January 1, 1994. The 1993 results include the cumulative
effect of adopting Statement of Financial Accounting
Standards No. 109 "Accounting for Income Taxes", as of
January 1, 1993.
(B) First quarter 1994 reflects the effect of adopting Statement
of Financial Accounting Standards No. 115, "Accounting for
Certain Investments in Debt and Equity Securities", as of
January 1, 1994
(C) First quarter 1994 reflects the effect of adopting FASB
Interpretation No. 39, "Offsetting of Amounts Related to
Certain Contracts", as of January 1, 1994.
(D) Estimated.
</TABLE>
OPERATING MARGIN
($ Millions)
<TABLE>
<CAPTION>
First Quarter
1994 1993
---- ----
<S> <C> <C>
Total Revenue ................... $3,861 $3,885
Effect of Credit Card
Securitization.................. 268 359
Net Cost to Carry(A)............. 29 83
Capital Building
Transactions.................... (23) (75)
----- -----
Adjusted Revenue................. $4,135 $4,252
----- -----
Total Operating Expense.......... $2,447 $2,526
Net OREO Costs (B)............... (28) (115)
----- -----
Adjusted Operating
Expense......................... $2,419 $2,411
----- -----
Operating Margin................. $1,716 $1,841
Consumer Credit
Costs (C)....................... 614 716
Commercial Credit
Costs (D)....................... 60 380
----- -----
Operating Margin
Less Credit Costs............... $1,042 $ 745
Additional Provision(E):
- -Consumer........................ 50 75
- -Commercial...................... 50 75
- -Refinancing Portfolio........... (34) -
Capital Building
Transactions ................... 23 75
----- -----
Income Before Taxes and
Cumulative Effect of
Accounting Changes............. $ 999 $ 670
===== =====
(A) Principally the net cost to carry commercial cash-basis
loans and Other Real Estate Owned (OREO).
(B) Principally net write-downs and direct revenues and
expenses related to OREO.
(C) Principally consumer net credit write-offs adjusted for
the effect of securitization of credit card receivables.
(D) Includes commercial net credit write-offs, net cost to
carry, net OREO write-downs and direct revenues and
expenses related to OREO.
(E) Represents provision for credit losses above(below)
net write-offs.
</TABLE>
BUSINESS FOCUS
Net Income (Loss)
($ Millions)
<TABLE>
<CAPTION>
First Quarter
1994 1993(A)
------ ------
<S> <C> <C>
Global Consumer:
North America, Europe
and Japan...................... $ 256 $ 154
Emerging Economies............... 171 142
----- -----
Total Global Consumer............. $ 427 $ 296
----- -----
Global Finance:
North America, Europe
and Japan...................... $ 86 $ 233
Emerging Economies............... 178 147
----- -----
Total Global Finance.............. $ 264 $ 380
----- -----
North America Commercial
Real Estate..................... $ (76) $ (204)
Cross-Border Refinancing
Portfolio....................... 49 37
Corporate Items(B)................ (55) (139)
----- -----
$ 609 $ 370
Cumulative Effect of
Accounting Changes(C)........... (56) 300
----- -----
Citicorp.......................... $ 553 $ 670
===== =====
(A) Reclassified to conform to current quarter's presentation.
(B) Corporate Items includes the effects of capital building
transactions and the offset created by attributing income
taxes to business activities on a local tax basis.
(C) First quarter 1994 includes the cumulative effect of
adopting Statement of Financial Accounting Standards
No. 112, "Employers' Accounting for Postemployment
Benefits", as of January 1, 1994. The 1993 results
include the cumulative effect of adopting Statement
of Financial Accounting Standards No. 109, "Accounting
for Income Taxes", as of January 1, 1993.
</TABLE>
GLOBAL CONSUMER
($ Millions)
<TABLE>
<CAPTION>
First Quarter %
1994 1993(A) Chg
------ ------ ----
<S> <C> <C> <C>
Total Revenue................ $2,490 $2,238 11
----- -----
Total Operating Expense...... $1,493 $1,427 5
----- -----
Provision For
Credit Losses .............. $ 378 $ 411 (8)
----- -----
Income Before Taxes.......... $ 619 $ 400 55
Income Taxes................. 192 104 85
----- -----
Net Income................... $ 427 $ 296 44
===== =====
OTHER DATA:
Average Assets ($B).......... 102 99 3
Return on Assets............. 1.70% 1.21% -
Adjusted for Credit-
Related Items:
Total Revenue(B)
North America, Europe
and Japan............... $2,147 $2,086 3
Emerging Economies....... 613 515 19
----- -----
Total Global Consumer.... $2,760 $2,601 6
----- -----
Other Operating
Expense(C)
North America, Europe
and Japan............... $1,146 $1,130 1
Emerging Economies....... 331 280 18
----- -----
Total Global Consumer.... $1,477 $1,410 5
----- -----
Credit Costs (D)
North America, Europe
and Japan............... $ 575 $ 681 (16)
Emerging Economies....... 39 35 11
----- -----
Total Global Consumer.... $ 614 $ 716 (14)
----- -----
(A) Reclassified to conform to current quarter's presentation.
(B) Adjusted principally for the effect of credit card
securitization.
(C) Excludes net write-downs and net direct expenses related
to OREO for certain real estate lending activities.
(D) Principally net credit write-offs adjusted for the effect
of credit card securitization. Includes U.S. credit card
net credit losses for both held and securitized receivables
of $381 million for 1994 first quarter and $471 million
for the comparable period of 1993.
</TABLE>
GLOBAL FINANCE
($ Millions)
<TABLE>
<CAPTION>
First Quarter %
1994 1993(A) Chg
------ ------ ----
<S> <C> <C> <C>
Total Revenue................ $1,204 $1,445 (17)
----- -----
Total Operating Expense...... $ 786 $ 838 (6)
----- -----
Provision For
Credit Losses .............. $ (34) $ 111 N/M
----- -----
Income Before Taxes.......... $ 452 $ 496 (9)
Income Taxes................. 188 116 62
----- -----
Net Income................... $ 264 $ 380 (31)
===== =====
OTHER DATA:
Average Assets ($B)(B)....... 134 104 29
Return on Assets............. 0.80% 1.48% -
Adjusted for Credit-
Related Items:
Total Revenue(C)
North America, Europe
and Japan............... $ 677 $ 950 (29)
Emerging Economies....... 528 518 2
----- -----
Total Global Finance..... $1,205 $1,468 (18)
----- -----
Other Operating
Expense(D)
North America, Europe
and Japan............... $ 535 $ 518 3
Emerging Economies....... 264 310 (15)
----- -----
Total Global Finance..... $ 799 $ 828 (4)
----- -----
Credit Costs (E)
North America, Europe
and Japan............... $ (47) $ 54 N/M
Emerging Economies....... (11) 15 N/M
----- -----
Total Global Finance..... $ (58) $ 69 N/M
----- -----
(A) Reclassified to conform to current quarter's presentation.
(B) First quarter 1994 reflects the effect of adopting FASB
Interpretation No. 39 "Offsetting of Amounts Related to
Certain Contracts" as of January 1, 1994.
(C) After adding back the net cost to carry cash-basis loans
and OREO.
(D) Excludes net write-downs (recoveries) and direct revenues
and expenses related to OREO.
(E) Includes net write-offs, the net cost to carry cash-basis
loans and OREO, as well as net write-downs (recoveries)
and direct revenues and expenses related to OREO.
N/M Not meaningful as percentage exceeds 100%.
</TABLE>
NORTH AMERICA COMMERCIAL REAL ESTATE
($ Millions)
<TABLE>
<CAPTION>
First Quarter %
1994 1993(A) Chg
------ ------ ----
<S> <C> <C> <C>
Total Revenue................ $ 19 $ (20) N/M
----- -----
Total Operating Expense...... $ 60 $ 127 (53)
----- -----
Provision For
Credit Losses............... $ 106 $ 168 (37)
----- -----
(Loss) Before Taxes.......... $ (147) $ (315) 53
Income Taxes................. (71) (111) 36
----- -----
Net (Loss)................... $ (76) $ (204) 63
===== =====
OTHER DATA:
Average Assets ($B).......... 10 13 (23)
Adjusted for Credit-
Related Items:
Total Revenue (B).......... 45 36 25
Total Operating
Expense (C)............... 35 39 (10)
Credit Costs (D)........... 119 312 (62)
(A) Reclassified to conform to current quarter's presentation.
(B) After adding back the net cost to carry cash-basis loans
and OREO.
(C) Excludes net write-downs and direct revenues and expenses
related to OREO.
(D) Includes net write-offs, the net cost to carry cash-basis
loans and OREO, as well as net write-downs and direct
revenues and expenses related to OREO.
N/M Not meaningful as percentage exceeds 100%.
</TABLE>
CROSS-BORDER REFINANCING PORTFOLIO
($ Millions)
<TABLE>
<CAPTION>
First Quarter %
1994 1993(A) Chg
------ ------ ----
<S> <C> <C> <C>
Total Revenue ............... $ 28 $ 47 (40)
----- -----
Operating Expense............ $ 6 $ 6 -
----- -----
Provision For
Credit Losses............... $ (35) $ (1) N/M
----- -----
Income Before Taxes $ 57 $ 42 36
Income Taxes................. 8 5 60
----- -----
Net Income................... $ 49 $ 37 32
===== =====
OTHER DATA:
Average Assets($B)........... 2 3
CORPORATE ITEMS
($ Millions)
First Quarter %
1994 1993(A) Chg
------ ------ ----
Total Revenue ............... $ 120 $ 175 (31)
----- -----
Total Operating Expense...... $ 102 $ 128 (20)
----- -----
Income Before Taxes.......... $ 18 $ 47 (62)
Income Taxes................. 73 186 (61)
----- -----
Net (Loss)(B)................ $ (55) $ (139) 60
===== =====
(A) Reclassified to conform to current quarter's presentation.
(B) Corporate Items includes net after-tax gains from capital
building transactions of $14 million and $41 million in
the first quarter of 1994 and 1993, respectively.
Additionally, Corporate Items includes the offset created
by attributing income taxes to business activities on a
local tax basis.
N/M Not meaningful as percentage exceeds 100%.
</TABLE>
ASSET QUALITY
COMMERCIAL CASH-BASIS LOANS AND OREO
($ Millions)
<TABLE>
<CAPTION>
1st Q 4th Q 3rd Q 2nd Q 1st Q
1994 1993 1993 1993 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
North America Commercial
Real Estate........... $1,654 $1,719 $2,138 $2,474 $2,593
Global Finance......... 699 755 1,063 1,346 1,267
----- ----- ----- ----- -----
Total Commercial
Cash-Basis Loans...... $2,353 $2,474 $3,201 $3,820 $3,860
Commercial OREO........ 2,598 2,796 3,122 3,479 3,721
----- ----- ----- ----- -----
Total Commercial Cash-
Basis Loans & OREO.... $4,951 $5,270 $6,323 $7,299 $7,581
----- ----- ----- ----- -----
Cross-Border Refinancing
Cash-Basis Loans...... $ 991 $1,041 $1,068 $1,082 $1,242
ALLOWANCE FOR CREDIT LOSSES
($ Millions)
1st Q 4th Q 3rd Q 2nd Q 1st Q
1994 1993 1993 1993 1993
----- ----- ----- ----- -----
Global Consumer........ $1,639 $1,596 $1,550 $1,491 $1,412
Commercial............. 2,595 2,545 2,482 2,394 2,296
Cross-Border Refinancing 238 238 228 205 325
----- ----- ----- ----- -----
Total.................. $4,472 $4,379 $4,260 $4,090 $4,033
===== ===== ===== ===== =====
Reserve for Global
Consumer Sold Portfolios $ 538 $ 527 $ 559 $ 557 $ 557
ALLOWANCE AS A PERCENTAGE
OF TOTAL LOANS
1st Q 4th Q 3rd Q 2nd Q 1st Q
1994 1993 1993 1993 1993
----- ----- ----- ----- -----
Global Consumer........ 1.98% 1.89% 1.89% 1.83% 1.75%
Commercial............. 4.88% 4.88% 4.49% 4.35% 4.25%
Total(A)............... 3.26% 3.15% 3.05% 2.94% 2.92%
ADDITIONAL DATA
1st Q 4th Q 3rd Q 2nd Q 1st Q
1994 1993 1993 1993 1993
----- ----- ----- ----- -----
Commercial Allowance as %
of Commercial Cash-Basis
Loans................. 110.3% 102.9% 77.5% 62.7% 59.5%
Commercial Renegotiated
Loans(B).............. $ 346 $ 669 $ 337 $ 107 $ 96
Consumer OREO.......... $1,247 $1,212 $1,283 $1,312 $1,314
(A) Includes the Cross-Border Refinancing Portfolio allowance
and related portfolio.
(B) Excludes renegotiated cross-border outstandings.
</TABLE>
DETAILS OF CREDIT LOSS EXPERIENCE
($ Millions)
<TABLE>
<CAPTION>
1st Q 4th Q 3rd Q 2nd Q 1st Q
1994 1993 1993 1993 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
NET WRITE-OFFS:
Global Consumer......... $ 328 $ 351 $ 356 $ 367 $ 336
North America Commercial
Real Estate............ 68 78 49 136 168
Global Finance.......... (46) 16 69 36 36
---- ---- ---- ---- ----
Total Non-Refinancing
Commercial............ $ 22 $ 94 $ 118 $ 172 $ 204
---- ---- ---- ---- ----
Cross-Border
Refinancing (A)........ (35) (10) (23) 120 (26)
---- ---- ---- ---- ----
Total................... $ 315 $ 435 $ 451 $ 659 $ 514
==== ==== ==== ==== ====
1st Q 4th Q 3rd Q 2nd Q 1st Q
1994 1993 1993 1993 1993
----- ----- ----- ----- -----
PROVISION FOR
CREDIT LOSSES:
Global Consumer......... $ 378 $ 414 $ 419 $ 442 $ 411
North America Commercial
Real Estate............ 106 141 115 186 168
Global Finance.......... (34) 16 91 87 111
---- ---- ---- ---- ----
Total Non-Refinancing
Commercial............ $ 72 $ 157 $ 206 $ 273 $ 279
---- ---- ---- ---- ----
Cross-Border
Refinancing............ (35) - - - (1)
---- ---- ---- ---- ----
Total................... $ 415 $ 571 $ 625 $ 715 $ 689
==== ==== ==== ==== ====
NET OREO WRITE-DOWNS (RECOVERIES):
North America Commercial
Real Estate............ $ 36 $ 27 $ 73 $ 65 $ 92
Global Finance.......... (6) (30) 13 (1) 4
---- ---- ---- ---- ----
Total................... $ 30 $ (3) $ 86 $ 64 $ 96
==== ==== ==== ==== ====
(A) Includes gross write-offs of $152 million in the
second quarter of 1993 related to Citicorp's medium-
and long-term outstandings to Brazil.
</TABLE>
STATEMENT OF OPERATIONS CITICORP and Subsidiaries
(In Millions of Dollars,
Except Per Share Amounts)
<TABLE>
<CAPTION>
First Quarter %
1994 1993 Chg
----- ----- ---
<S> <C> <C> <C>
Interest Revenue.............. $6,458 $5,869 10
Interest Expense.............. 4,373 4,022 9
----- -----
Net Interest Revenue.......... $2,085 $1,847 13
----- -----
Fees & Commissions........... $1,259 $1,213 4
Trading Account.............. 5 217 (98)
Foreign Exchange............. 66 240 (73)
Inv Securities Transactions.. 50 16 N/M
Other Revenue................ 396 352 13
----- -----
Total Fees, Commissions
and Other Revenue............ $1,776 $2,038 (13)
----- -----
TOTAL REVENUE................. $3,861 $3,885 (1)
----- -----
PROVISION FOR CREDIT LOSSES... $ 415 $ 689 (40)
----- -----
Operating Expense:
Salaries.................... $ 954 $ 913 4
Staff Benefits.............. 283 265 7
Net Premises &
Equipment Expense........... 390 396 (2)
Other Expense............... 820 952 (14)
----- -----
TOTAL OPERATING EXPENSE $2,447 $2,526 (3)
----- -----
INCOME BEFORE TAXES
AND CUMULATIVE EFFECT
OF ACCOUNTING CHANGES........ $ 999 $ 670 49
Income Taxes................. 390 300 30
----- -----
INCOME BEFORE CUMULATIVE
EFFECT OF ACCOUNTING
CHANGES...................... $ 609 $ 370 65
Cumulative Effect of
Accounting Changes(A)......... (56) 300 N/M
----- -----
NET INCOME.................... $ 553 $ 670 (17)
===== =====
INCOME APPLICABLE
TO COMMON STOCK.............. $ 466 $ 595 (22)
===== =====
EARNINGS PER SHARE :
On Common & Common Equiv. Shs
Income Before Cumulative
Effect of Acctg Changes..... $ 1.24 $ 0.71 75
Cumulative Effect of
Accounting Changes(A)....... $(0.13) $ 0.67 N/M
Net Income................... $ 1.11 $ 1.38 (20)
Assuming Full Dilution
Income Before Cumulative
Effect of Acctg Changes..... $ 1.12 $ 0.67 67
Cumulative Effect of
Accounting Changes(A)....... $(0.11) $ 0.57 N/M
Net Income................... $ 1.01 $ 1.24 (19)
(A) First quarter 1994 includes the cumulative effect of
adopting Statement of Financial Accounting Standards
No. 112, "Employers' Accounting for Postemployment
Benefits", as of January 1, 1994. The 1993 results
include the effect of adopting Statement of Financial
Accounting Standards No. 109, "Accounting for Income
Taxes", as of January 1, 1993.
N/M Not meaningful as percentage exceeds 100%.
</TABLE>
CONSOLIDATED BALANCE SHEET CITICORP and Subsidiaries
(In Millions of Dollars)
<TABLE>
<CAPTION>
Mar. 31 Dec. 31 %
1994 1993(A) Chg
-------- -------- ---
<S> <C> <C> <C>
ASSETS
Cash and Due from Banks......... $ 5,705 $ 4,836 18
Deposits at Interest with Banks. 7,221 6,749 7
Securities(B):
Held to Maturity............... 7,292 5,637 29
Available for Sale............. 9,876 8,705 13
Venture Capital................ 1,522 1,489 2
Trading Account Assets.......... 42,688 (C) 23,783 79
Federal Funds Sold &
Securities Purchased
Under Resale Agreements........ 10,108 7,339 38
Loans, Net
Consumer....................... $ 82,654 $ 84,354 (2)
Commercial(B).................. 54,619 54,613 -
------- -------
Total Loans................. $137,273 $138,967 (1)
Allowance for Credit Losses..... (4,472) (4,379) (2)
------- -------
Total Loans, Net............ $132,801 $134,588 (1)
Customers' Acceptance Liability $ 1,368 $ 1,512 (10)
Premises & Equipment, Net....... 3,811 3,842 (1)
Interest & Fees Receivable...... 2,603 2,552 2
Other Assets.................... 16,101 15,542 4
------- -------
Total........................... $241,096 $216,574 11
======= =======
LIABILITIES
Non-Int. Deposits (in the U.S.). $ 13,925 $ 13,442 4
Int. Deposits (in the U.S.)..... 37,905 38,347 (1)
Non-Int. Deposits (Outside the
U.S.).......................... 7,191 6,644 8
Int. Deposits(Outside the U.S.). 93,977 86,656 8
------- -------
Total Deposits.............. $152,998 $145,089 5
Trading Account Liabilities..... 21,767 (C) 5,478 N/M
Purchased Funds &
Other Borrowings............... 17,527 16,777 4
Acceptances Outstanding......... 1,386 1,531 (9)
Accrued Taxes & Other Expenses.. 6,290 6,452 (3)
Other Liabilities............... 9,364 9,134 3
Long-Term Debt.................. 15,265 16,010 (5)
Subordinated Capital Notes...... 1,750 2,150 (19)
STOCKHOLDERS' EQUITY
Preferred Stock
(Without Par Value)............ $ 3,887 $ 3,887 -
Common Stock (Par value $1.00).. 415 412 1
Surplus......................... 3,973 3,898 2
Retained Earnings .............. 7,195 6,729 7
Net Unrealized Gains-Securities
Available for Sale(B).......... 227 - N/M
Foreign Currency Translation.... (557) (580) 4
Common Stock in Treasury,
at Cost........................ (391) (393) 1
------- -------
Total Stockholders' Equity.. $ 14,749 $ 13,953 6
------- -------
Total........................... $241,096 $216,574 11
======= =======
(A) Reclassified to conform to current quarter's presentation.
(B) Balances at March 31, 1994 reflect the effect of adopting
Statement of Financial Accounting Standards No. 115,
"Accounting for Certain Investments in Debt and Equity
Securities", including the reclassification of approximately
$1.7 billion of "Brady Bonds" from Commercial Loans to Held
to Maturity and Available for Sale Securities. Statement
No. 115, which requires that securities designated as
"available for sale" be carried at fair value, with
unrealized gains and losses reported in stockholders' equity
net of applicable taxes) was adopted effective
January 1, 1994.
(C) Trading Account Assets and Trading Account Liabilities
as of March 31, 1994 include approximately $14.7 billion
relating to the adoption of Financial Accounting Standards
Board Interpretation No. 39, "Offsetting of Amounts
Related to Certain Contracts", effective January 1, 1994.
Interpretation No. 39 requires that unrealized trading
gains and losses be reported gross on the balance sheet
except where there is a qualifying netting agreement in
place. On a pro-forma basis, Trading Account Assets and
Trading Account Liabilities as of December 31, 1993 would
have been $36.8 billion and $18.5 billion, respectively,
had the new rule been in effect on that date. Amounts
presented for Trading Account Assets and Trading Account
Liabilities as of December 31, 1993 include the reclass-
ification of $5.7 billion and $3.1 billion, respectively,
to provide for consistent presentation of amounts previously
recorded in Other Assets and Other Liabilities representing
revaluation gains and losses and other balances related to
these contracts.
N/M Not meaningful as percentage exceeds 100%.
</TABLE>
ADDITIONAL FINANCIAL INFORMATION
<TABLE>
<CAPTION>
First Quarter
1994 1993
------ ------
<S> <C> <C>
NET INTEREST REVENUE(A)
($ Millions)
Net Interest Revenue......... $ 2,087 $ 1,851
Net Interest Margin.......... 4.01% 3.82%
ADJUSTED TO EXCLUDE
THE EFFECT OF CREDIT
CARD SECURITIZATION:
Net Interest Revenue........ $ 2,616 $ 2,472
Net Interest Margin......... 4.52% 4.52%
First Quarter
1994 1993(B)
------ ------
OTHER REVENUE
($ Millions)
Affiliate Earnings........... $ 65 $ 41
Securitized Credit
Card Receivables............ 208 244
Net (Losses) from
Mortgage Pass-Through
Securitization Activity(C) (38) (66)
Venture Capital Gains........ 79 54
Net Gains on the Sale/
Disposition of Assets....... 30 79
Foreign Currency
Translation (Losses)........ - (28)
Other Items.................. 52 28
------ ------
Total...................... $ 396 $ 352
====== ======
(A) Taxable Equivalent Basis.
(B) Reclassified to conform to current quarter's presentation.
(C) Represents impairment related to excess servicing fees
receivable and credit costs in connection with recourse
obligations partially offset by gains on sale of mortgage
pass-throughs.
</TABLE>
CONSOLIDATED AVERAGE BALANCES
<TABLE>
<CAPTION>
First Quarter %
1994 1993 Chg
-------- ------- -----
<S> <C> <C> <C>
Loans ($B):
Consumer................. $ 84 $ 82 2
Commercial............... 54 58 (7)
------- -------
Total Loans............... $ 138 $ 140 (1)
======= =======
Total Assets ($B)(A)...... $ 253 $ 225 12
Interest Earning
Assets($B).............. $ 211 $ 196 8
Common Stockholders'
Equity ($M) (B).......... $ 10,562 $ 8,364 26
Preferred Equity ($M)..... 3,887 3,212 21
------- -------
Total Stockholders'
Equity ($M) (B).......... $ 14,449 $ 11,576 25
======= =======
COMMON SHARES OUTSTANDING
(In Thousands)
End-Of-Period............. 389,280 372,715 4
Weighted Average for Purposes
of Earnings Per Share:
Common & Common
Equivalent Shares (C).... 441,894 449,859 (2)
Assuming Full
Dilution (D)............. 517,717 525,999 (2)
(A) The effect of implementing Financial Accounting
Standards Board Interpretation No. 39, "Offsetting
of Amounts Related to Certain Contracts", in the
first quarter 1994 is reflected in non-interest
earning assets.
(B) Reflects the effect of adopting Statement of Financial
Accounting Standards No. 115, "Accounting for Certain
Investments in Debt and Equity Securities", in the
first quarter 1994.
(C) Includes shares related to the assumed conversion of
Conversion Preferred Stock, Series 15 (Conversion
Preferred Stock). For purposes of computing earnings
per share, the dividends related to the Conversion
Preferred Stock are added back to income applicable
to common stock.
(D) Includes shares related to the assumed conversion of
the Conversion Preferred Stock, Series 15 and
Convertible Preferred Stock, Series 12 and 13. For
purposes of computing earnings per share, the dividends
related to the Conversion Preferred Stock and Convertible
Preferred Stock are added back to income applicable
to common stock.
</TABLE>
Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits
- Exhibit No. 12(a) Calculation of Ratio
of Income to Fixed Charges
- Exhibit No. 12(b) Calculation of Ratio
of Income to Fixed Charges Including
Preferred Stock Dividends
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
CITICORP
(Registrant)
By: /s/ Thomas E. Jones
-------------------------------
Thomas E. Jones
Executive Vice President
A Principal Financial Officer
Dated: April 21, 1994
<TABLE>
<CAPTION>
CITICORP AND SUBSIDIARIES
CALCULATION OF RATIO OF INCOME TO FIXED CHARGES
(In Millions)
EXCLUDING INTEREST ON DEPOSITS THREE MONTHS
ENDED
MAR 31
1993 1992 1991 1990 1989 1994 1993
------ ------- ------- ------- ------- ------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
FIXED CHARGES:
INTEREST EXPENSE (OTHER THAN
INTEREST ON DEPOSITS) (A) 6,324 5,826 5,973 9,414 11,482 1,903 1,573
INTEREST FACTOR IN RENT EXPENSE 147 162 171 173 161 37 37
------- ------- ------- ------- ------- ------- ------
TOTAL FIXED CHARGES 6,471 5,988 6,144 9,587 11,643 1,940 1,610
INCOME:
ADJUSTED NET INCOME(LOSS) 1,919(B) 722 (914)(C) 318(D) 498 609(E) 370(B)
INCOME TAXES 941 696 677 508 1,035 390 300
FIXED CHARGES (A) 6,471 5,988 6,144 9,587 11,643 1,940 1,610
------- ------- ------- ------- ------- ------- -------
TOTAL INCOME 9,331 7,406 5,907 10,413 13,176 2,939 2,280
======= ======= ======= ======= ======= ======= =======
RATIO OF INCOME TO FIXED CHARGES
EXCLUDING INTEREST ON DEPOSITS 1.44 1.24 0.96(F) 1.09 1.13 1.51 1.42
======= ======= ======= ======= ======= ======= =======
INCLUDING INTEREST ON DEPOSITS:
FIXED CHARGES:
INTEREST EXPENSE 16,121 16,327 17,089 23,798 24,218 4,373 4,022
INTEREST FACTOR IN RENT EXPENSE 147 162 171 173 161 37 37
------- ------- ------- ------- ------- ------- -------
TOTAL FIXED CHARGES 16,268 16,489 17,260 23,971 24,379 4,410 4,059
INCOME:
NET INCOME(LOSS) 1,919(B) 722 (914)(C) 318(D) 498 609(E) 370(B)
INCOME TAXES 941 696 677 508 1,035 390 300
FIXED CHARGES 16,268 16,489 17,260 23,971 24,379 4,410 4,059
------- ------- ------- ------- ------- ------- -------
TOTAL INCOME 19,128 17,907 17,023 24,797 25,912 5,409 4,729
======= ======= ======= ======= ======= ======= =======
RATIO OF INCOME TO FIXED CHARGES
INCLUDING INTEREST ON DEPOSITS 1.18 1.09 0.99(F) 1.03 1.06 1.23 1.17
======= ======= ======= ======= ======= ======= ======
(A) PRIOR YEARS HAVE BEEN RECLASSIFIED TO CONFORM TO CURRENT YEAR'S PRESENTATION.
(B) NET INCOME FOR THE THREE MONTHS ENDED MARCH 31, 1993 AND THE FULL YEAR 1993 EXCLUDE THE CUMULATIVE EFFECT
OF ADOPTING STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO.109, "ACCOUNTING FOR INCOME TAXES", OF $300 MILLION.
(C) NET INCOME FOR THE YEAR ENDED DECEMBER 31, 1991 EXCLUDES THE CUMULATIVE EFFECT OF ACCOUNTING CHANGE FOR
VENTURE CAPITAL INVESTMENTS OF $457 MILLION.
(D) NET INCOME FOR THE YEAR ENDED DECEMBER 31, 1990 EXCLUDES THE CUMULATIVE EFFECT OF ACCOUNTING CHANGE FOR
CERTAIN DERIVATIVE PRODUCTS OF $140 MILLION.
(E) NET INCOME FOR THE THREE MONTHS ENDED MARCH 31,1994 EXCLUDES THE CUMULATIVE EFFECT OF ADOPTING STATEMENT
OF FINANCIAL ACCOUNTING STANDARDS NO. 112, "EMPLOYERS' ACCOUNTING FOR POSTEMPLOYMENT BENEFITS", OF $(56)
MILLION.
(F) EARNINGS FOR THE YEAR ENDED DECEMBER 31, 1991 WERE INADEQUATE TO COVER FIXED CHARGES BY THE AMOUNT OF $237
MILLION.
</TABLE>
<TABLE>
<CAPTION>
CITICORP AND SUBSIDIARIES
CALCULATION OF RATIO OF INCOME TO FIXED CHARGES
INCLUDING PREFERRED STOCK DIVIDENDS
(In Millions)
THREE MONTHS
EXCLUDING INTEREST ON DEPOSITS ENDED
MAR 31
1993 1992 1991 1990 1989 1994 1993
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
FIXED CHARGES:
INTEREST EXPENSE (OTHER THAN
INTEREST ON DEPOSITS)(A) 6,324 5,826 5,973 9,414 11,482 1,903 1,573
INTEREST FACTOR IN RENT EXPENSE 147 162 171 173 161 37 37
DIVIDENDS - PREFERRED STOCK 465 416 271(B) 361 385 143 132
------- ------- ------- ------- ------- ------- -------
TOTAL FIXED CHARGES 6,936 6,404 6,415 9,948 12,028 2,083 1,742
INCOME:
NET INCOME(LOSS) 1,919(C) 722 (914)(D) 318(E) 498 609(F) 370(C)
INCOME TAXES 941 696 677 508 1,035 390 300
FIXED CHARGES (EXCLUDING
PREFERRED STOCK DIVIDENDS)(A) 6,471 5,988 6,144 9,587 11,643 1,940 1,610
------- ------- ------- ------- ------- ------- -------
TOTAL INCOME 9,331 7,406 5,907 10,413 13,176 2,939 2,280
======= ======= ======= ======= ======= ======= =======
RATIO OF INCOME TO FIXED CHARGES
EXCLUDING INTEREST ON DEPOSITS 1.35 1.16 0.92(G) 1.05 1.10 1.41 1.31
======= ======= ======= ======= ======= ======= =======
INCLUDING INTEREST ON DEPOSITS:
FIXED CHARGES:
INTEREST EXPENSE 16,121 16,327 17,089 23,798 24,218 4,373 4,022
INTEREST FACTOR IN RENT EXPENSE 147 162 171 173 161 37 37
DIVIDENDS - PREFERRED STOCK 465 416 271(B) 361 385 143 132
------- ------- ------- ------- ------- ------ ------
TOTAL FIXED CHARGES 16,733 16,905 17,531 24,332 24,764 4,553 4,191
INCOME:
NET INCOME(LOSS) 1,919(C) 722 (914)(D) 318(E) 498 609(F) 370(C)
INCOME TAXES 941 696 677 508 1,035 390 300
FIXED CHARGES (EXCLUDING
PREFERRED STOCK DIVIDENDS) 16,268 16,489 17,260 23,971 24,379 4,410 4,059
------- ------- ------- ------- ------- ------- ------
TOTAL INCOME 19,128 17,907 17,023 24,797 25,912 5,409 4,729
======= ======= ======= ======= ======= ======= ======
RATIO OF INCOME TO FIXED CHARGES
INCLUDING INTEREST ON DEPOSITS 1.14 1.06 0.97(G) 1.02 1.05 1.19 1.13
======= ======= ======= ======= ====== ======= ======
(A) PRIOR YEARS HAVE BEEN RECLASSIFIED TO CONFORM TO CURRENT YEAR'S PRESENTATION.
(B) CALCULATED ON A BASIS OF AN ASSUMED TAX RATE OF OF 34%.
(C) NET INCOME FOR THE THREE MONTHS ENDED MARCH 31, 1993 AND THE FULL YEAR 1993 EXCLUDE THE CUMULATIVE EFFECT
OF
ADOPTING STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 109, "ACCOUNTING FOR INCOME TAXES", OF $300 MILLION.
(D) NET INCOME FOR THE YEAR ENDED DECEMBER 31, 1991 EXCLUDES THE CUMULATIVE EFFECT OF ACCOUNTING CHANGE FOR
VENTURE CAPITAL INVESTMENTS OF $457 MILLION.
(E) NET INCOME FOR THE YEAR ENDED DECEMBER 31, 1990 EXCLUDES THE CUMULATIVE EFFECT OF ACCOUNTING CHANGE FOR
CERTAIN DERIVATIVE PRODUCTS OF $140 MILLION.
(F) NET INCOME FOR THE THREE MONTHS ENDED MARCH 31, 1994 EXCLUDES THE CUMULATIVE EFFECT OF ADOPTING STATEMENT
OF FINANCIAL ACCOUNTING STANDARDS NO. 112, "EMPLOYERS' ACCOUNTING FOR POSTEMPLOYMENT BENEFITS", OF $(56)
MILLION.
(G) EARNINGS FOR THE YEAR ENDED DECEMBER 31, 1991 WERE INADEQUATE TO COVER FIXED CHARGES BY THE AMOUNT OF $508
MILLION.
</TABLE>
