U.S. 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) January 25, 1999
---------------------------
Citigroup Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-9924 52-1568099
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
153 East 53rd Street, New York, New York 10043
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(Address of principal executive offices) (Zip Code)
(212) 559-1000
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(Registrant's telephone number, including area code)
<PAGE>
Citigroup Inc.
Current Report on Form 8-K
Item 5. Other Events.
On January 25, 1999, Citigroup Inc. reported core income for the fourth quarter
ended December 31, 1998 of $1.4 billion, or $.61 per basic share and $.60 per
diluted share. This compares with core income in the 1997 period of $1.9
billion, or $.83 per share basic and $.80 diluted. The 1998 results reflect
record earnings from the company's newly defined Global Consumer business and a
partial rebound in its Global Corporate business as the volatility in many of
the world's markets diminished.
Net income for the quarter was $677 million, or $.28 per share basic and
diluted. This compares with net income in the 1997 period of $1.4 billion, or
$.61 per share basic and $.59 diluted. The 1998 total includes $703 million out
of an approximately $900 million expected after-tax restructuring charge
associated with recently announced business improvement and integration
initiatives. These initiatives are projected to yield expense savings of
approximately $680 million pretax in 1999, and to reach a run rate of
approximately $975 million in annual pretax savings beginning in 2000. In 1999,
these actions, together with tighter management of non-customer expenses and
realized savings from earlier efficiency initiatives still in progress, are
expected to yield gross annual pretax expense savings of approximately $2
billion.
Fourth quarter 1998 net income also includes $65 million of one-time expenses
associated with merging Citigroup's predecessor organizations and $42 million of
reductions in 1997 charges for the Citicorp cost-management and customer service
initiatives and the Salomon Inc merger. Net income for the 1997 quarter includes
$496 million of charges for the Salomon merger.
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Note: Core income excludes restructuring actions and merger-related expenses,
which are included in net income.
2
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Citigroup's "top-line" growth, excluding investment activities, resumed a
double-digit pace in the quarter, with adjusted net business revenues up 12%
from the 1997 period to $13.3 billion. This includes 20% growth in the Global
Consumer business, 3% growth in the Global Corporate business and 18% growth in
the Asset Management business. Adjusted operating expenses grew 18% on a
comparable basis, including sector increases of 21%, 8% and 31%, respectively.
Expenses increased more than revenues primarily because of higher marketing
expenditures in the Global Consumer business, increased technology initiatives,
including spending for the Year 2000 and EMU, and increased compensation costs
in the Global Corporate business. The quarter's expenses also include a $100
million pretax contribution of appreciated venture capital securities to the
company's Foundation.
At year-end 1998, stockholders' equity and trust preferreds totaled over $47
billion, which represents one of the largest capital bases of any financial
services organization in the world. The company's strong balance sheet is
further evidenced by its 8.6% Tier I capital ratio. Total assets for the company
were approximately $660 billion at year end.
Full Year 1998
Core income for the full year 1998 was $6.3 billion, or $2.73 per share basic
and $2.66 diluted, compared with $7.8 billion, or $3.32 per share basic and
$3.18 diluted, in 1997. Net income totaled $5.8 billion, or $2.49 per share
basic and $2.43 diluted, compared with 1997 net income of $6.7 billion, or $2.86
per share basic and $2.74 diluted. The 1998 net income total includes the
previously mentioned fourth quarter restructuring actions and merger-related
expenses plus an additional $191 million reduction in the 1997 Salomon merger
reserve. Net income for 1997 includes restructuring charges for the Citicorp
cost-management and customer service initiatives and the Salomon merger.
Adjusted net business revenues for 1998 were $49.8 billion versus $47.8 billion
in 1997. Core return on equity was 14.9% versus 20.2%.
3
<PAGE>
Building a Powerful Franchise
John S. Reed and Sanford I. Weill, Chairmen and Co-Chief Executive Officers,
said in a statement, "In just over three months since the formation of
Citigroup, substantial progress has been made in our integration, though we are
by no means satisfied with the company's performance thus far. We are committed
to achieving significantly higher levels of profitability in 1999 and beyond
through a combination of business growth, stringent expense control, and
continued reduction of risk exposure.
"Toward that end, we are pleased with the actions being taken and the potential
in the Consumer business. By offering consumers the broadest range of
competitively priced and conveniently obtained products and services, our goal
is to secure an increasing portion of the consumer dollar spent on financial
products. Cross-selling possibilities are abundant, and we are actively
implementing those with the most promise while substantially reducing expenses.
"Progress is admittedly slower in the Corporate business, partly because of the
most extreme global market volatility in recent memory. We have, however,
significantly reduced our risk profile, particularly in Salomon Smith Barney's
global arbitrage operation. Risk management is a priority throughout the global
banking business as well, with the goal of deriving a higher percentage of
earnings from controllable business operations than has been the case in the
past. Expense reduction is an equal priority, as is fostering a collaborative
effort in serving clients between Citibank's Corporate Bank and Salomon Smith
Barney's Investment Bank. To date, the recently initiated system of joint
customer calls has already resulted in the closure of over 70 major
collaborative transactions around the world, with significantly more in process.
"Our Asset Management business is progressing according to plan and is
positioned for dynamic growth. Access to potential clients has been
significantly enhanced by the merger, as has our ability to distribute products
such as mutual funds through multiple channels, both in the United States and
abroad.
4
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"We are building a unique and powerful franchise in Citigroup, across our
individual businesses and around the globe. We are unique in having a solid and
growing base of stable and recurring earnings, which account for approximately
two-thirds of our income. We are a powerful marketing force with more quality
products, services and expertise to offer customers around the world, both
individuals and institutions, than any financial services company in existence.
We are confident that our growth plan is moving in the right direction."
GLOBAL CONSUMER
4th Quarter Core Income: $901 Million, Up 20% from $750 Million in 1997 Period
1998 Core Income: $3.26 Billion, Up 7% from $3.05 Billion in 1997
Growth in Global Consumer earnings, which includes the North American and
International banking/lending businesses and the personal insurance business,
continued to accelerate, with core income reaching record levels for the quarter
and year. The quarter's results reflect a dramatic improvement in the
profitability of the U.S. card operation, together with continued strong growth
in insurance, consumer finance and the Asia Pacific region, partially offset by
weakness in Latin America and increased marketing and development spending.
North America Consumer
o The Banking/Lending business turned in a strong fourth quarter
performance, with core income up 49% from the prior year period to $414
million. Cards was the largest contributor in the quarter, with an 80%
increase in earnings to $277 million attributable to pricing changes,
lower funding costs and growth in charge volumes, partially offset by
higher marketing spending. U.S. bankcard receivables grew 40% largely
because of the acquisition of the Universal Card portfolio, while the net
credit loss ratio continued to decline. Commercial Credit earned $73
million, up 16% versus the 1997 quarter, on strong growth in receivables
across all product lines and
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distribution channels. Citibanking's fourth quarter earnings of $20
million were down slightly from last year, while full year earnings were
up 59% on strong deposit and account growth. Mortgage Banking saw 16%
growth in earnings to $44 million in the quarter, resulting from improved
credit experience. Refinancing activity also contributed to a positive
full year comparison.
o The Insurance sector recorded significant growth across all business
units, earning $316 million in the quarter and $1.2 billion for the year.
Travelers Life & Annuity's earnings rose 12% from last year's fourth
quarter to $125 million, reflecting double-digit growth in annuity account
balances and life and long term care premiums. The 14% increase in
earnings at Primerica to $103 million reflected continued success at
cross-selling a wide range of products, including consumer loans, property
casualty insurance, mutual funds and variable annuities manufactured by
other Citigroup businesses. Cross-selling these additional products
continues to account for an increasing percentage of Primerica's earnings,
up to 27% in 1998 from 12% three years ago. Also contributing to earnings
growth were an increase in the average face value of new term life
policies and continued emphasis on increasing the number of
representatives licensed to sell various products and services. Travelers
Property Casualty's Personal Lines registered a 17% quarterly earnings
gain to $88 million on particularly strong net investment income. Premiums
rose 16% on higher auto insurance sales through both independent agent and
alternative distribution channels.
International Consumer
International recorded a 13% earnings gain in the quarter to $256 million. The
leading contributor was the Asia Pacific region with a 62% increase in earnings
to $120 million as a "flight to quality" continued to drive growth in accounts
and business volume. This growth also reflects the implementation of a
cooperative arrangement with the Japan Postal Service and the introduction in
December of Citigroup mutual funds to Japan's
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newly deregulated securities market, where they immediately became top sellers.
Europe, Middle East, Africa (EMEA) also reported higher earnings in the quarter
resulting from account and asset growth in Western Europe. This 35% increase in
earnings to $42 million was limited by higher investment spending, including
further expansion of the company's consumer businesses in Hungary and Turkey.
Latin America experienced a 49% quarterly earnings decrease to $29 million
because of a declining contribution from Credicard, a 33%-owned Brazilian card
affiliate, together with weaker credit experience. Partially offsetting the
effects of the recent economic uncertainty in Latin America was income from new
acquisitions in the region. The Global Private Bank, which serves high net worth
individuals around the world, recorded earnings of $65 million, about even with
the 1997 quarter. Revenue growth in the developed markets and Latin America was
offset by increased expenses, primarily for staffing, and higher credit costs in
Asia.
e-Citi
Net losses for this sector grew 54% and 80% for the quarter and year to $43
million and $142 million, respectively. This reflects spending for the
development of electronic banking initiatives, including investment in Direct
Access, Citibank's award-winning online banking service, and other
Internet-based transactional banking products which will extend customer reach.
Other
Other Consumer business items include unallocated marketing and staff expenses.
The $39 million increase in expenses from the 1997 quarter to $42 million
reflects outlays for new global advertising, marketing and distribution
development initiatives.
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<PAGE>
GLOBAL CORPORATE
4th Quarter Core Income: $464 Million, Down 21% from $585 Million in 1997 Period
1998 Core Income: $2.0 Billion, Down 42% from $3.5 Billion in 1997
The results of the Global Corporate sector, though down, showed substantial
improvement from the preceding quarter, which was depressed by extreme economic
turmoil in much of the world. Emerging Markets earnings showed particularly
strong growth versus the fourth quarter of 1997. Travelers Property Casualty's
Commercial Lines also turned in higher earnings despite continued challenges in
its operating environment. These increases were more than offset by still
disappointing contributions from Salomon Smith Barney and Global Relationship
Banking, which continued to show some adverse effects from market volatility,
albeit less severe than in the preceding quarter.
o Salomon Smith Barney reported fourth quarter income of $13 million, a
considerable improvement over the third quarter but still below the 1997
quarter's already weak $218 million. Revenues from retail operations,
including brokerage commissions and the Consulting Group's
industry-leading "wrap fee" investment advisory business, grew 9% from the
1997 period. Investment banking revenues declined, reflecting a slowdown
in equity underwriting and merger and acquisition activities in the
quarter. Volatility in the global markets continued to negatively affect
principal trading results, particularly in fixed income trading, as well
as in global arbitrage as we continued to scale back non-strategic
positions. Non-interest expenses rose 10% from the 1997 quarter, primarily
from higher compensation expense, reflecting the unit's year-end bonus
award decisions.
o Emerging Markets income of $220 million represented a 189% increase from
the 1997 quarter. Net revenues rose 30%, driven by significantly higher
trading income and improved lending results, somewhat offset by reduced
asset sales. Full year
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revenue growth was fueled by a substantial increase in transaction banking
services as well as higher trading income. Operating expenses were held to
year ago levels in the quarter despite ongoing investment spending to
further develop Citigroup's franchise in the emerging markets. Credit
costs of $102 million, while considerably above the fourth quarter of
1997, were stable versus the previous quarter, excluding the impact of
Russia.
o Global Relationship Banking reported fourth quarter earnings of $30
million, well above its third quarter result but still significantly below
income in the 1997 quarter of $125 million. Revenues fell 11%, reflecting
substantially lower asset sales, primarily commercial real estate, as well
as lower corporate finance and loan syndication activity, all of which
were especially strong in the year ago quarter. These reductions were
moderated by a double-digit increase in transaction banking services.
Operating expenses rose 11%, reflecting increased technology spending,
particularly for EMU adaptations, which were successfully navigated, and
for the Year 2000. Results were aided by credit benefits of $59 million in
the quarter, primarily from gains on the sale of Other Real Estate Owned
(OREO) properties.
o Travelers Property Casualty's Commercial Lines earnings increased 21% in
the quarter to $201 million on particularly strong net investment income
and continued expense discipline. Premiums were about even with the prior
year period, reflecting the company's underwriting restraint in the face
of intense price competition. The statutory combined ratio was also
relatively stable at 108.5%.
ASSET MANAGEMENT
4th Quarter Core Income: $51 Million, Down 16% from $61 Million in 1997 Period
1998 Core Income: $273 Million, Up 12% from $243 Million in 1997
SSB Citi Asset Management Group earnings declined in the quarter as a result of
increased spending to build its Citibank Global Asset Management investment
research
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and analysis capabilities, partially offset by a 4% increase in the earnings of
its Salomon Smith Barney Asset Management operation to $58 million. The
segment's pretax profit margin for the quarter was 25.7%, down from 33.3% in the
prior year.
Assets under management rose 25% from the fourth quarter of 1997 to $327
billion, reflecting strong growth in all asset categories. Contributing to this
growth were the acquisition of J.P. Morgan's Australian asset management
business unit with $4.6 billion of assets under management; the launch of six
new retail mutual fund products, which raised over $1.7 billion; continued
strong mutual fund sales through Primerica; significant flows into money market
and other short-term funds, primarily in the year's second half; and positive
market performance.
Cross-selling efforts continued to be successful. The amount of proprietary
mutual funds sold through Primerica more than doubled in the quarter and
accounted for 60% of Primerica's total 1998 mutual fund sales. SSB Citi Asset
Management's increased support for Salomon Smith Barney's retail channel
resulted in the capture of 31.5% of the brokerage operation's mutual fund sales,
up from 26.5% in 1997. During the second half of 1998, SSB Citi also embarked on
several new distribution initiatives made possible by the Citigroup combination,
including the sale of Salomon Brothers open-end mutual funds through the
Citibank Consumer Bank and the distribution of the Citifunds Investment Series
through the Global Consumer Bank in Japan.
CORPORATE ITEMS
4th Quarter Core Loss: $14 Million Versus Core Income of $8 Million in 1997
Period
1998 Core Loss: $159 Million, Down 57% from $370 Million in 1997
Corporate Items include net treasury results, corporate staff and similar
expenses, and variances between the consolidated and local tax rates for banking
segments. The loss for the 1998 quarter includes a $100 million pretax
contribution of appreciated venture
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capital securities to the company's Foundation, which had minimal impact on
Citigroup's earnings after related tax benefits and investment gains.
INVESTMENT ACTIVITIES
4th Quarter Core Income: $1 Million Versus $530 Million in 1997 Period
1998 Core Income: $929 Million, Down 28% from $1.3 Billion in 1997
The declines in earnings from Investment Activities for the quarter and the full
year reflect substantially lower equity investing activities (including the
write-down of an investment in Latin America), reduced LDC debt sales and lower
insurance portfolio gains. Citigroup's $68 billion investment portfolio consists
mainly of fixed income securities with average quality ratings of A+/A1 and also
includes proprietary equity investments. The majority of the portfolio is held
by the insurance companies, whose fixed income securities, including short-term
investments, have an effective duration of 5.1 years.
Share Repurchase
During the fourth quarter of 1998, Citigroup repurchased 24.4 million shares of
its common stock for a total cost of $1.1 billion. This lowered the weighted
average common shares for basic earnings per share to 2,233 million in the
quarter and for diluted earnings per share to 2,290 million. For the full year
1998, the company repurchased 62.7 million common shares for a total of $3.1
billion to offset the dilution from the issuance of shares under incentive
compensation plans.
* * *
Certain of the statements contained herein that are not historical facts are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act. The Company's actual results may differ materially from
those included in the forward-looking statements. Forward-looking statements are
typically identified by words or phrases such as "believe," "expect,"
"anticipate," "intend," "estimate, "target,"
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<PAGE>
"may increase," "may fluctuate," "may result in," "are projected," and similar
expressions. These forward-looking statements involve risks and uncertainties
including, but not limited to, the following: customer responsiveness to both
new products and distribution channels; general economic conditions, including
the performance of financial markets and interest rates; and timely
implementation of restructuring programs and the ability of the Company
generally to achieve anticipated levels of operational efficiencies and expense
savings related to recent transactions or otherwise. Readers also are directed
to other risks and uncertainties discussed in documents filed by the Company
with the Securities and Exchange Commission.
12
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<TABLE>
<CAPTION>
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Citigroup Segment Income (A) Fourth Quarter % Full Year %
---------------------------- ----------------------------
(In Millions of Dollars) 1998 1997 Change 1998 1997 Change
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Global Consumer
Citibanking......................... $ 20 $ 22 (9) $ 113 $ 71 59
Mortgage Banking.................... 44 38 16 175 117 50
Cards............................... 277 154 80 737 523 41
Commercial Credit................... 73 63 16 264 213 24
---------------------------- ----------------------------
Banking/Lending....................... 414 277 49 1,289 924 40
Travelers Life & Annuity............ 125 112 12 496 424 17
Primerica Financial Services........ 103 90 14 400 335 19
Personal Lines (B).................. 88 75 17 319 300 6
---------------------------- ----------------------------
Insurance 316 277 14 1,215 1,059 15
---------------------------- ----------------------------
Total North America...................... 730 554 32 2,504 1,983 26
---------------------------- ----------------------------
Europe, Middle East, & Africa......... 42 31 35 155 138 12
Asia Pacific.......................... 120 74 62 410 428 (4)
Latin America......................... 29 57 (49) 163 273 (40)
Global Private Bank................... 65 65 -- 254 281 (10)
---------------------------- ----------------------------
Total International...................... 256 227 13 982 1,120 (12)
---------------------------- ----------------------------
e-Citi................................... (43) (28) (54) (142) (79) (80)
Other.................................... (42) (3) NM (86) 24 NM
---------------------------- ----------------------------
Total Global Consumer.................... 901 750 20 3,258 3,048 7
---------------------------- ----------------------------
Global Corporate
Salomon Smith Barney..................... 13 218 (94) 408 1,438 (72)
Emerging Markets......................... 220 76 NM 690 909 (24)
Global Relationship Banking.............. 30 125 (76) 220 559 (61)
Commercial Lines (B)..................... 201 166 21 723 632 14
---------------------------- ----------------------------
Total Global Corporate................... 464 585 (21) 2,041 3,538 (42)
---------------------------- ----------------------------
---------------------------- ----------------------------
Asset Management......................... 51 61 (16) 273 243 12
---------------------------- ----------------------------
Corporate/Other.......................... (14) 8 NM (159) (370) 57
---------------------------- ----------------------------
Business Income.......................... 1,402 1,404 -- 5,413 6,459 (16)
---------------------------- ----------------------------
---------------------------- ----------------------------
Investment Activities (C)................ 1 530 NM 929 1,292 (28)
---------------------------- ----------------------------
---------------------------- ----------------------------
Core Income.............................. 1,403 1,934 (27) 6,342 7,751 (18)
---------------------------- ----------------------------
Restructuring Charge and
Merger-Related Expenses (D)............ (726) (496) (46) (535) (1,046) 49
---------------------------- ----------------------------
Net Income............................... $ 677 $1,438 (53) $5,807 $6,705 (13)
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(A) Amounts reflect each company's existing policies for revenue, expense, tax
and equity allocations; consequently business results may not be
comparable across companies.
(B) In the aggregate, these represent Citigroup's share of Travelers Property
Casualty Corp. results.
(C) Includes Citicorp's venture capital activities, certain Corporate
investments, the results of certain investments in the former refinancing
countries, and portfolio gains and losses primarily arising from the
insurance-related activities of Citigroup.
(D) For the 1998 fourth quarter, includes the restructuring charge associated
with recently announced business improvement and integration initiatives
of $703 million, merger-related expenses of $65 million, and credits for
reversals of the 1997 restructuring charges of $42 million.
NM Not meaningful, as percentage equals or exceeds 100%.
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13
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CITIGROUP - QUARTERLY FINANCIAL DATA SUPPLEMENT citigroup [LOGO]
Citigroup provides a broad array of financial products and services to over
100 million customers in 100 countries around the world.
<TABLE>
<CAPTION>
==================================================================================================================================
-------- --------
(in millions, except per share amounts) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
1997 1997 1997 1997 1998 1998 1998 1998
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Core Income $ 1,815 $ 1,908 $ 2,094 $ 1,934 $ 2,161 $ 2,049 $ 729 $ 1,403
Restructuring (Charge) Release/Merger Expenses -- -- (550) (496) -- 191 -- (726)
-------- -------- -------- -------- -------- -------- -------- --------
Net Income $ 1,815 $ 1,908 $ 1,544 $ 1,438 $ 2,161 $ 2,240 $ 729 $ 677
======== ======== ======== ======== ======== ======== ======== ========
Basic Earnings Per Share:
Core Income $ 0.77 $ 0.82 $ 0.90 $ 0.83 $ 0.94 $ 0.89 $ 0.30 $ 0.61
======== ======== ======== ======== ======== ======== ======== ========
Net Income $ 0.77 $ 0.82 $ 0.66 $ 0.61 $ 0.94 $ 0.97 $ 0.30 $ 0.28
======== ======== ======== ======== ======== ======== ======== ========
Weighted average common shares
applicable to Basic EPS 2,257.4 2,247.4 2,245.7 2,241.2 2,243.3 2,244.0 2,248.3 2,233.4
======== ======== ======== ======== ======== ======== ======== ========
Preferred Dividends - Basic $ 74 $ 70 $ 67 $ 68 $ 63 $ 58 $ 50 $ 45
======== ======== ======== ======== ======== ======== ======== ========
Diluted Earnings Per Share:
Core Income $ 0.74 $ 0.78 $ 0.86 $ 0.80 $ 0.90 $ 0.86 $ 0.30 $ 0.60
======== ======== ======== ======== ======== ======== ======== ========
Net Income $ 0.74 $ 0.78 $ 0.63 $ 0.59 $ 0.90 $ 0.94 $ 0.30 $ 0.28
======== ======== ======== ======== ======== ======== ======== ========
Adjusted weighted average common shares
applicable to Diluted EPS 2,371.3 2,356.3 2,357.1 2,344.9 2,328.6 2,330.9 2,320.7 2,290.3
======== ======== ======== ======== ======== ======== ======== ========
Preferred Dividends - Diluted $ 64 $ 60 $ 57 $ 62 $ 57 $ 52 $ 44 $ 39
======== ======== ======== ======== ======== ======== ======== ========
Common Shares Outstanding, at period end 2,295.4 2,286.7 2,284.0 2,279.9 2,280.8 2,280.5 2,275.5 2,258.0
======== ======== ======== ======== ======== ======== ======== ========
Tier 1 Capital Ratio N/A N/A N/A 8.37% 8.38% 8.46% 8.69% 8.6%*
======== ======== ======== ======== ======== ======== ======== ========
Total Capital Ratio N/A N/A N/A 11.07% 10.97% 11.00% 11.28% 11.4%*
======== ======== ======== ======== ======== ======== ======== ========
Leverage Ratio N/A N/A N/A 5.64% 5.67% 5.65% 5.73% 6.1%*
======== ======== ======== ======== ======== ======== ======== ========
Total Assets, at period end (in billions) $ 658.3 $ 699.8 $ 705.0 $ 697.4 $ 738.8 $ 750.8 $ 701.3 $ 667.4*
======== ======== ======== ======== ======== ======== ======== ========
Total Equity, at period end (in billions) $ 38.4 $ 40.5 $ 41.6 $ 41.9 $ 42.8 $ 43.9 $ 43.1 $ 42.7
======== ======== ======== ======== ======== ======== ======== ========
Book Value Per Share, at period end $ 15.41 $ 16.21 $ 16.81 $ 16.89 $ 17.45 $ 18.06 $ 17.92 $ 17.87
======== ======== ======== ======== ======== ======== ======== ========
Book Value Per Share, excluding FAS 115 $ 15.16 $ 15.60 $ 15.99 $ 16.14 $ 16.67 $ 17.37 $ 17.38 $ 17.27
======== ======== ======== ======== ======== ======== ======== ========
Return on Equity (Net Income) 20.1% 20.5% 15.5% 14.3% 22.0% 21.8% 6.6% 6.2%
======== ======== ======== ======== ======== ======== ======== ========
Return on Equity (Core Income) 20.1% 20.5% 21.2% 19.1% 21.4% 19.4% 6.5% 13.0%
======== ======== ======== ======== ======== ======== ======== ========
Return on Equity (Core Income), excluding FAS 115 20.6% 21.1% 22.2% 19.9% 22.4% 20.2% 6.7% 13.4%
======== ======== ======== ======== ======== ======== ======== ========
-------- --------
<CAPTION>
(in millions, except per share amounts) Full Year Full Year
1997 1998
-------- --------
<S> <C> <C>
Core Income $ 7,751 $ 6,342
Restructuring (Charge) Release/Merger Expenses (1,046) (535)
-------- --------
Net Income $ 6,705 $ 5,807
======== ========
Basic Earnings Per Share:
Core Income $ 3.32 $ 2.73
======== ========
Net Income $ 2.86 $ 2.49
======== ========
Weighted average common shares
applicable to Basic EPS 2,247.9 2,242.4
======== ========
Preferred Dividends - Basic $ 279 $ 216
======== ========
Diluted Earnings Per Share:
Core Income $ 3.18 $ 2.66
======== ========
Net Income $ 2.74 $ 2.43
======== ========
Adjusted weighted average common shares
applicable to Diluted EPS 2,357.7 2,315.2
======== ========
Preferred Dividends - Diluted $ 243 $ 192
======== ========
Common Shares Outstanding, at period end 2,279.9 2,258.0
======== ========
Tier 1 Capital Ratio 8.37% 8.6%*
======== ========
Total Capital Ratio 11.07% 11.4%*
======== ========
Leverage Ratio 5.64% 6.1%*
======== ========
Total Assets, at period end (in billions) $ 697.4 $ 667.4*
======== ========
Total Equity, at period end (in billions) $ 41.9 $ 42.7
======== ========
Book Value Per Share, at period end $ 16.89 $ 17.87
======== ========
Book Value Per Share, excluding FAS 115 $ 16.14 $ 17.27
======== ========
Return on Equity (Net Income) 17.5% 14.0%
======== ========
Return on Equity (Core Income) 20.2% 14.9%
======== ========
Return on Equity (Core Income), excluding FAS 115 20.9% 15.5%
======== ========
</TABLE>
* Preliminary
================================================================================
Page 14
<PAGE>
CITIGROUP -- SEGMENT NET REVENUES citigroup [LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
-------- --------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Global Consumer:
Banking / Lending
Citibanking North America $ 447 $ 460 $ 484 $ 484 $ 483 $ 522 $ 492 $ 492 $ 1,875 $ 1,989
Cards 1,372 1,342 1,337 1,379 1,391 1,797 1,902 2,018 5,430 7,108
Mortgage Banking 130 134 119 136 139 137 145 137 519 558
Consumer Finance Services 235 246 282 304 309 326 342 361 1,067 1,338
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Total Banking / Lending 2,184 2,182 2,222 2,303 2,322 2,782 2,881 3,008 8,891 10,993
Insurance
Travelers Life and Annuity 613 649 650 758 695 766 713 832 2,670 3,006
Primerica Financial Services 372 378 381 391 400 420 413 421 1,522 1,654
Personal Lines 796 810 831 839 868 899 924 975 3,276 3,666
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Total Insurance 1,781 1,837 1,862 1,988 1,963 2,085 2,050 2,228 7,468 8,326
International
Europe, Middle East and Africa 457 465 466 476 454 479 496 525 1,864 1,954
Asia Pacific 455 476 459 409 399 438 442 494 1,799 1,773
Latin America 356 370 357 363 345 360 422 435 1,446 1,562
Global Private Bank 246 249 264 259 250 272 266 273 1,018 1,061
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Total International 1,514 1,560 1,546 1,507 1,448 1,549 1,626 1,727 6,127 6,350
e-Citi 24 26 30 32 29 34 37 47 112 147
Other 26 29 26 24 27 21 23 26 105 97
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Global Consumer 5,529 5,634 5,686 5,854 5,789 6,471 6,617 7,036 22,703 25,913
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Global Corporate:
Salomon Smith Barney 2,531 2,548 2,828 2,311 2,918 2,523 685 2,207 10,218 8,333
Emerging Markets Banking 818 779 866 720 885 904 697 936 3,183 3,422
Global Relationship Banking 889 825 858 928 903 1,069 706 830 3,500 3,508
Commercial Lines 1,587 1,588 1,578 1,550 1,619 1,584 1,604 1,674 6,303 6,481
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Global Corporate 5,825 5,740 6,130 5,509 6,325 6,080 3,692 5,647 23,204 21,744
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
SSB Citi Asset Management Group 241 256 282 273 302 306 315 321 1,052 1,244
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Corporate / Other 193 194 242 209 228 217 215 272 838 932
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
- ------------------------------------------------------------------------------------------------------------------------------------
Total Business Revenues 11,788 11,824 12,340 11,845 12,644 13,074 10,839 13,276 47,797 49,833
- ------------------------------------------------------------------------------------------------------------------------------------
Investment Activities 161 315 485 732 612 484 162 40 1,693 1,298
- ------------------------------------------------------------------------------------------------------------------------------------
Total Core Revenues $ 11,949 $ 12,139 $ 12,825 $ 12,577 $ 13,256 $ 13,558 $ 11,001 $ 13,316 $ 49,490 $ 51,131
- ------------------------------------------------------------------------------------------------------------------------------------
-------- --------
</TABLE>
Page 15
<PAGE>
CITIGROUP -- SEGMENT CORE INCOME citigroup [LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
------- -------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Global Consumer:
Banking / Lending
Citibanking North America $ 10 $ 16 $ 23 $ 22 $ 32 $ 34 $ 27 $ 20 $ 71 $ 113
Cards 141 103 125 154 139 117 204 277 523 737
Mortgage Banking 24 30 25 38 42 41 48 44 117 175
Consumer Finance Services 44 51 55 63 59 60 72 73 213 264
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Total Banking / Lending 219 200 228 277 272 252 351 414 924 1,289
Insurance
Travelers Life and Annuity 101 105 106 112 118 130 123 125 424 496
Primerica Financial Services 78 82 85 90 95 103 99 103 335 400
Personal Lines 79 75 71 75 82 81 68 88 300 319
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Total Insurance 258 262 262 277 295 314 290 316 1,059 1,215
International
Europe, Middle East and Africa 25 38 44 31 37 29 47 42 138 155
Asia Pacific 121 122 111 74 87 94 109 120 428 410
Latin America 80 77 59 57 46 42 46 29 273 163
Global Private Bank 71 66 79 65 59 65 65 65 281 254
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Total International 297 303 293 227 229 230 267 256 1,120 982
e-Citi (11) (16) (24) (28) (28) (37) (34) (43) (79) (142)
Other 9 10 8 (3) (2) (13) (29) (42) 24 (86)
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Global Consumer 772 759 767 750 766 746 845 901 3,048 3,258
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Global Corporate:
Salomon Smith Barney 367 404 449 218 443 348 (396) 13 1,438 408
Emerging Markets Banking 308 248 277 76 283 206 (19) 220 909 690
Global Relationship Banking 147 150 137 125 109 175 (94) 30 559 220
Commercial Lines 141 155 170 166 171 174 177 201 632 723
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Global Corporate 963 957 1,033 585 1,006 903 (332) 464 3,538 2,041
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
SSB Citi Asset Management Group 53 58 71 61 75 74 73 51 243 273
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
Corporate / Other (147) (112) (119) 8 (149) (43) 47 (14) (370) (159)
------- ------- ------- ------- ------- ------- ------ ------- ------- -------
- -----------------------------------------------------------------------------------------------------------------------------------
Total Business Income 1,641 1,662 1,752 1,404 1,698 1,680 633 1,402 6,459 5,413
- -----------------------------------------------------------------------------------------------------------------------------------
Investment Activities 174 246 342 530 463 369 96 1 1,292 929
- -----------------------------------------------------------------------------------------------------------------------------------
Total Core Income $ 1,815 $ 1,908 $ 2,094 $ 1,934 $ 2,161 $ 2,049 $ 729 $ 1,403 $ 7,751 $ 6,342
- -----------------------------------------------------------------------------------------------------------------------------------
------- -------
</TABLE>
Page 16
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
CITIBANKING NORTH AMERICA
(In millions of dollars)
<TABLE>
<CAPTION>
------ ------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 447 $ 460 $ 484 $ 484 $ 483 $ 522 $ 492 $ 492 $1,875 $1,989
Adjusted Operating Expense 395 399 409 408 412 437 417 439 1,611 1,705
Credit Costs (1) 33 35 30 33 31 30 28 22 131 111
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income Before Taxes 19 26 45 43 40 55 47 31 133 173
Income Taxes 9 10 22 21 8 21 20 11 62 60
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income $ 10 $ 16 $ 23 $ 22 $ 32 $ 34 $ 27 $ 20 $ 71 $ 113
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Average Assets (in billions of dollars) $ 11 $ 11 $ 11 $ 11 $ 11 $ 12 $ 12 $ 12 $ 11 $ 12
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Return on Assets 0.37% 0.58% 0.83% 0.79% 1.18% 1.14% 0.89% 0.66% 0.65% 0.94%
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
------ ------
</TABLE>
(1) Represents provision for loan losses.
Page 17
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
CARDS (1)
(In millions of dollars)
<TABLE>
<CAPTION>
------ ------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Adjusted Revenues $1,372 $1,342 $1,337 $1,379 $1,391 $1,797 $1,902 $2,018 $5,430 $7,108
Adjusted Operating Expense 456 458 461 457 455 723 736 778 1,832 2,692
Credit Costs (2) 701 732 686 689 717 885 846 805 2,808 3,253
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income Before Taxes 215 152 190 233 219 189 320 435 790 1,163
Income Taxes 74 49 65 79 80 72 116 158 267 426
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income $ 141 $ 103 $ 125 $ 154 $ 139 $ 117 $ 204 $ 277 $ 523 $ 737
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Average Assets (in billions of dollars) $ 25 $ 25 $ 26 $ 25 $ 23 $ 30 $ 28 $ 31 $ 25 $ 28
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Return on Assets 2.29% 1.65% 1.91% 2.44% 2.45% 1.56% 2.89% 3.55% 2.09% 2.63%
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
------ ------
</TABLE>
(1) Includes U.S. Bankcards, Diners Club and Travelers Bank. The acquisition
of the Universal Card was completed in the second quarter 1998.
(2) Represents provision for loan losses (on a managed basis).
<TABLE>
<CAPTION>
------- ---------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
1997 1997 1997 1997 1998 1998 1998 1998
------- ------- ------- ------- ------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. BANKCARDS DATA (1):
(in billions of dollars)
End of Period Managed Receivables $ 46.1 $ 47.0 $ 47.7 $ 49.6 $ 46.8 $ 62.0 $ 63.8 $ 69.6
Total accounts (in millions) 25.9 26.0 25.9 25.8 25.6 39.4 39.7 40.5
Charge volume $ 23.7 $ 26.2 $ 27.4 $ 29.0 $ 25.3 $ 35.4 $ 37.7 $ 42.2
End of Period Loans
On Balance Sheet $ 18.2 $ 20.3 $ 19.1 $ 20.2 $ 16.5 $ 17.3 $ 19.8 $ 21.9
Securitized 25.4 24.2 26.0 26.8 27.8 41.5 40.6 44.3
Held for Sale 2.0 2.0 2.0 2.0 2.0 2.5 2.6 2.9
------- ------- ------- ------- ------- ------- ------- ---------
Total $ 45.6 $ 46.5 $ 47.1 $ 49.0 $ 46.3 $ 61.3 $ 63.0 $ 69.1
======= ======= ======= ======= ======= ======= ======= =========
Average Loans
On Balance Sheet $ 18.8 $ 19.1 $ 19.8 $ 19.0 $ 17.3 $ 21.0 $ 19.3 $ 20.9
Securitized 25.1 24.7 24.8 26.3 27.6 37.0 40.2 41.5
Held for Sale 2.0 2.0 2.0 2.0 2.0 2.5 2.5 2.7
------- ------- ------- ------- ------- ------- ------- ---------
Total $ 45.9 $ 45.8 $ 46.6 $ 47.3 $ 46.9 $ 60.5 $ 62.0 $ 65.1
======= ======= ======= ======= ======= ======= ======= =========
Write-offs (in millions of dollars)
On Balance Sheet $ 228 $ 253 $ 239 $ 229 $ 214 $ 271 $ 229 $ 222
Securitized 402 404 378 403 431 544 542 536
Held for Sale 32 33 30 31 31 37 34 32
------- ------- ------- ------- ------- ------- ------- ---------
Total $ 662 $ 690 $ 647 $ 663 $ 676 $ 852 $ 805 $ 790
======= ======= ======= ======= ======= ======= ======= =========
Coincident Net Credit Loss Rate 5.85% 6.04% 5.50% 5.56% 5.85% 5.65% 5.15% 4.82%
12 Month Lagged Net Credit Loss Rate (ex-UCS) 6.16% 6.44% 5.88% 5.82% 5.98% 5.92% 5.43% 5.30%
90+ Days Past Due
In millions of dollars $ 894 $ 855 $ 818 $ 868 $ 855 $ 956 $ 939 $ 1,001
% 1.96% 1.84% 1.74% 1.77% 1.85% 1.56% 1.49% 1.45%
% of Gross Write-offs that are Bankruptcies
(excluding Travelers Bank) 37% 40% 40% 41% 37% 41% 43% 43%
------- ---------
</TABLE>
(1) Includes U.S. Bankcards and Travelers Bank.
Page 18
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
MORTGAGE BANKING
(In millions of dollars)
<TABLE>
<CAPTION>
---- -----
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
---- ---- ---- ---- ---- ---- ---- ----- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $130 $134 $119 $136 $139 $137 $145 $ 137 $519 $558
Adjusted Operating Expense 58 57 59 60 59 61 62 61 234 243
Credit Costs (1) 32 25 16 14 13 9 3 (5) 87 20
---- ---- ---- ---- ---- ---- ---- ----- ---- ----
Core Income Before Taxes 40 52 44 62 67 67 80 81 198 295
Income Taxes 16 22 19 24 25 26 32 37 81 120
---- ---- ---- ---- ---- ---- ---- ----- ---- ----
Core Income $ 24 $ 30 $ 25 $ 38 $ 42 $ 41 $ 48 $ 44 $117 $175
==== ==== ==== ==== ==== ==== ==== ===== ==== ====
Average Assets (in billions of dollars) $ 23 $ 23 $ 24 $ 24 $ 25 $ 25 $ 25 $ 26 $ 24 $ 25
==== ==== ==== ==== ==== ==== ==== ===== ==== ====
Return on Assets 0.42% 0.52% 0.41% 0.63% 0.68% 0.66% 0.76% 0.67% 0.49% 0.70%
==== ==== ==== ==== ==== ==== ==== ===== ==== ====
---- -----
</TABLE>
(1) Represents provision for loan losses.
Page 19
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
CONSUMER FINANCE SERVICES*
(In millions of dollars)
<TABLE>
<CAPTION>
--------
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
-------- -------- -------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
NET REVENUES ** $ 235 $ 246 $ 282 $ 304 $ 309 $ 326
CORE INCOME $ 44 $ 51 $ 55 $ 63 $ 59 $ 60
Net receivables:
Real estate-secured loans (1) $3,697.2 $3,991.4 $4,910.6 $5,106.6 $ 5,324.7 $ 5,673.4
Personal loans (2) 3,178.0 3,246.9 3,729.9 3,831.5 3,868.9 4,007.4
Sales finance and other 513.0 548.4 751.4 848.7 866.3 893.7
-------- -------- -------- -------- --------- ---------
Consumer finance receivables,
net of unearned finance charges 7,388.2 7,786.7 9,391.9 9,786.8 10,059.9 10,574.5
Accrued interest receivable 46.0 49.6 66.4 77.1 75.8 79.1
Allowance for credit losses (222.5) (229.9) (291.7) (288.0) (294.6) (317.3)
-------- -------- -------- -------- --------- ---------
Consumer finance receivables, net $7,211.7 $7,606.4 $9,166.6 $9,575.9 $ 9,841.1 $10,336.3
======== ======== ======== ======== ========= =========
Number of offices 855 853 1,055 1,024 1,023 1,005
Average yield 15.23% 15.14% 15.30% 15.25% 14.91% 14.94%
Average net interest margin 8.48% 8.39% 8.64% 8.66% 8.35% 8.43%
Charge-off rate (3) 2.99% 2.99% 2.87% 2.51% 2.93% 2.79%
60+ days past due as % of receivables 1.70% 1.62% 1.68% 1.85% 1.82% 1.74%
Reserves as % of net receivables 3.01% 2.95% 3.11% 2.94% 2.93% 3.00%
(1) Includes fully secured $.M.A.R.T. receivables,
as follows: $1,307.8 $1,510.8 $1,689.1 $1,887.9 $ 2,052.8 $ 2,272.8
(2) Includes $.A.F.E. and partially secured $.M.A.R.T
receivables, as follows: $ 383.3 $ 381.5 $ 373.6 $ 367.8 $ 359.8 $ 351.3
--------
<CAPTION>
---------
4Q Full Year Full Year
1998 1997 1998
--------- -------- ---------
<S> <C> <C> <C>
NET REVENUES ** $ 361 $ 1,067 $ 1,338
CORE INCOME $ 73 $ 213 $ 264
Net receivables:
Real estate-secured loans (1) $ 6,659.5 $5,106.6 $ 6,659.5
Personal loans (2) 4,275.2 3,831.5 4,275.2
Sales finance and other 990.8 848.7 990.8
--------- -------- ---------
Consumer finance receivables,
net of unearned finance charges 11,925.5 9,786.8 11,925.5
Accrued interest receivable 99.2 77.1 99.2
Allowance for credit losses (369.7) (288.0) (369.7)
--------- -------- ---------
Consumer finance receivables, net $11,655.0 $9,575.9 $11,655.0
========= ======== =========
Number of offices 980 1,024 980
Average yield 14.74% 15.24% 14.88%
Average net interest margin 8.57% 8.56% 8.46%
Charge-off rate (3) 2.67% 2.82% 2.75%
60+ days past due as % of receivables 1.90% 1.85% 1.90%
Reserves as % of net receivables 3.10% 2.94% 3.10%
(1) Includes fully secured $.M.A.R.T. receivables,
as follows: $ 2,604.6 $1,887.9 $ 2,604.6
(2) Includes $.A.F.E. and partially secured $.M.A.R.T
receivables, as follows: $ 345.6 $ 367.8 $ 345.6
---------
</TABLE>
(3) The modest apparent increase in charge-off rate reflects a temporary
benefit in the year ago period resulting from a difference in charge-off
policy on the Security Pacific business acquired in the previous quarter.
* Prior periods have been restated to conform accounting policies and to
eliminate results of Travelers Bank, now included in Cards.
** Revenues (excluding realized gains), net of interest expense.
Note: Financial data for Security Pacific Financial Services is included from
the date of acquisition (July 31, 1997).
Page 20
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
TRAVELERS LIFE AND ANNUITY - Page 1
(In millions of dollars)
<TABLE>
<CAPTION>
---------
1Q 2Q 3Q 4Q 1Q 2Q 3Q
1997 1997 1997 1997 1998 1998 1998
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
NET REVENUES* $ 613 $ 649 $ 650 $ 758 $ 695 $ 766 $ 713
CORE INCOME $ 101 $ 105 $ 106 $ 112 $ 118 $ 130 $ 123
Pre-tax contribution by source:
Deferred and payout annuities $ 75.8 $ 73.9 $ 74.7 $ 86.2 $ 87.6 $ 93.8 $ 82.0
Group annuities 22.7 26.6 26.2 25.0 31.5 28.3 36.4
Life and long term care insurance 35.0 36.1 35.0 37.4 37.9 39.3 34.6
Other (includes run-off and return on excess capital) 19.7 23.8 26.9 20.2 24.1 37.6 37.6
--------- --------- --------- --------- --------- --------- ---------
Total $ 153.2 $ 160.4 $ 162.8 $ 168.8 $ 181.1 $ 199.0 $ 190.6
========= ========= ========= ========= ========= ========= =========
Deferred annuities:
Number of annuities in force (000):
Fixed 402.9 415.9 411.8 408.9 404.9 398.2 392.5
Variable 293.5 308.7 326.7 381.0 413.1 439.0 466.4
--------- --------- --------- --------- --------- --------- ---------
Total 696.4 724.6 738.5 789.9 818.0 837.2 858.9
========= ========= ========= ========= ========= ========= =========
Number of annuities issued (000):
Fixed 7.8 10.2 5.2 6.7 5.4 4.4 3.5
Variable 29.1 32.4 33.5 34.4 37.7 35.9 36.4
--------- --------- --------- --------- --------- --------- ---------
Total 36.9 42.6 38.7 41.1 43.1 40.3 39.9
========= ========= ========= ========= ========= ========= =========
Net written premiums & deposits:
Fixed $ 144.1 $ 241.7 $ 142.4 $ 250.7 $ 232.7 $ 187.2 $ 181.0
Variable 429.7 386.0 431.9 527.8 587.1 587.1 691.9
--------- --------- --------- --------- --------- --------- ---------
Total $ 573.8 $ 627.7 $ 574.3 $ 778.5 $ 819.8 $ 774.3 $ 872.9
========= ========= ========= ========= ========= ========= =========
Policyholder account balances & benefit reserves: (1)
Fixed $ 7,240.8 $ 7,340.5 $ 7,310.8 $ 7,358.7 $ 7,411.6 $ 7,361.8 $ 7,339.3
Variable 6,308.7 7,376.0 8,307.9 8,704.9 10,132.8 10,788.7 10,178.9
--------- --------- --------- --------- --------- --------- ---------
Total $13,549.5 $14,716.5 $15,618.7 $16,063.6 $17,544.4 $18,150.5 $17,518.2
========= ========= ========= ========= ========= ========= =========
Payout annuities:
Net written premiums & deposits $ 54.7 $ 68.2 $ 49.0 $ 138.0 $ 81.0 $ 106.8 $ 76.1
Policyholder account balances & benefit reserves $ 4,403.6 $ 4,426.0 $ 4,429.7 $ 4,522.2 $ 4,558.1 $ 4,602.2 $ 4,626.9
GIC and other annuities:
Net written premiums & deposits (2) $ 592.4 $ 563.8 $ 301.5 $ 651.0 $ 778.9 $ 921.6 $ 1,005.4
Policyholder account balances & benefit reserves: (1)
Guaranteed investment contracts $ 1,697.6 $ 1,976.1 $ 2,026.5 $ 2,367.6 $ 2,633.2 $ 3,018.1 $ 3,748.2
Other group annuities 4,991.3 5,122.0 5,212.4 5,051.4 5,040.1 5,052.9 4,962.6
--------- --------- --------- --------- --------- --------- ---------
Total $ 6,688.9 $ 7,098.1 $ 7,238.9 $ 7,419.0 $ 7,673.3 $ 8,071.0 $ 8,710.8
========= ========= ========= ========= ========= ========= =========
---------
<CAPTION>
---------
4Q Full Year Full Year
1998 1997 1998
--------- --------- ---------
<S> <C> <C> <C>
NET REVENUES* $ 832 $ 2,670 $ 3,006
CORE INCOME $ 125 $ 424 $ 496
Pre-tax contribution by source:
Deferred and payout annuities $ 88.6 $ 310.6 $ 352.0
Group annuities 24.1 100.5 120.3
Life and long term care insurance 42.6 143.5 154.4
Other (includes run-off and return on excess capital) 33.1 90.6 132.4
--------- --------- ---------
Total $ 188.4 $ 645.2 $ 759.1
========= ========= =========
Deferred annuities:
Number of annuities in force (000):
Fixed 389.8 408.9 389.8
Variable 490.0 381.0 490.0
--------- --------- ---------
Total 879.8 789.9 879.8
========= ========= =========
Number of annuities issued (000):
Fixed 3.9 29.9 17.2
Variable 33.6 129.4 143.6
--------- --------- ---------
Total 37.5 159.3 160.8
========= ========= =========
Net written premiums & deposits:
Fixed $ 173.1 $ 778.9 $ 774.0
Variable 784.6 1,775.4 2,650.7
--------- --------- ---------
Total $ 957.7 $ 2,554.3 $ 3,424.7
========= ========= =========
Policyholder account balances & benefit reserves: (1)
Fixed $ 7,348.9 $ 7,358.7 $ 7,348.9
Variable 12,500.1 8,704.9 12,500.1
--------- --------- ---------
Total $19,849.0 $16,063.6 $19,849.0
========= ========= =========
Payout annuities:
Net written premiums & deposits $ 165.1 $ 309.9 $ 429.0
Policyholder account balances & benefit reserves $ 4,743.6 $ 4,522.2 $ 4,743.6
GIC and other annuities:
Net written premiums & deposits (2) $ 983.7 $ 2,108.7 $ 3,689.6
Policyholder account balances & benefit reserves: (1)
Guaranteed investment contracts $ 4,170.7 $ 2,367.6 $ 4,170.7
Other group annuities 4,929.6 5,051.4 4,929.6
--------- --------- ---------
Total $ 9,100.3 $ 7,419.0 $ 9,100.3
========= ========= =========
---------
</TABLE>
(1) Includes general account, separate accounts and managed funds.
(2) Excludes deposits of $33.0, $136.0, $182.0 and $2.0 in the 1997
first, second, third and fourth quarters, respectively, and $13.0,
$197.0, $14.0 and $33.3 in the 1998 first, second, third and fourth
quarters, respectively, related to Travelers plans previously managed
externally.
* Revenues (excluding realized gains), net of interest expense.
Page 21
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
TRAVELERS LIFE AND ANNUITY - Page 2
(In millions of dollars)
<TABLE>
<CAPTION>
--------
1Q 2Q 3Q 4Q 1Q 2Q 3Q
1997 1997 1997 1997 1998 1998 1998
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Individual life insurance:
Life insurance in force (in billions, face amt.):
Term $ 29.5 $ 29.6 $ 29.7 $ 30.1 $ 30.6 $ 30.9 $ 31.4
Permanent (universal and whole life) 21.0 21.1 21.2 21.5 21.8 22.3 22.8
-------- -------- -------- -------- -------- -------- --------
Total $ 50.5 $ 50.7 $ 50.9 $ 51.6 $ 52.4 $ 53.2 $ 54.2
======== ======== ======== ======== ======== ======== ========
Number of life policies in force (000) 540.2 535.3 530.1 528.3 525.2 522.9 520.0
Life insurance issued (in billions, face amt.) $ 1.5 $ 1.5 $ 1.5 $ 2.0 $ 2.0 $ 2.1 $ 2.2
Number of life policies issued (000) 5.4 5.7 5.2 8.2 7.1 7.9 6.8
Net written premiums and deposits:
Direct periodic premiums and deposits $ 71.2 $ 68.5 $ 71.6 $ 79.1 $ 76.2 $ 78.2 $ 77.9
Single premium deposits 11.9 13.7 13.6 17.2 23.8 20.5 17.1
Reinsurance (13.3) (14.2) (15.7) (15.1) (14.8) (16.0) (16.5)
-------- -------- -------- -------- -------- -------- --------
Total $ 69.8 $ 68.0 $ 69.5 $ 81.2 $ 85.2 $ 82.7 $ 78.5
======== ======== ======== ======== ======== ======== ========
Policyholder account balances & benefit reserves $2,192.8 $2,222.1 $2,257.3 $2,283.4 $2,327.1 $2,360.0 $2,366.9
Individual long term care insurance:
Number of policies in force (000) 84.3 90.6 96.2 102.1 107.7 113.6 118.5
Net earned premiums $ 34.9 $ 39.1 $ 41.2 $ 44.1 $ 45.6 $ 48.7 $ 51.8
Net written premiums $ 42.5 $ 43.3 $ 43.7 $ 54.3 $ 44.5 $ 53.7 $ 53.3
All businesses:
Net investment income $ 439.9 $ 459.9 $ 463.2 $ 472.1 $ 480.3 $ 496.4 $ 474.0
Interest credited to contractholders $ 197.6 $ 204.6 $ 209.6 $ 217.7 $ 215.0 $ 210.3 $ 220.3
Statutory data:
Travelers Insurance Company
Statutory capital and surplus $3,555.5 $3,625.9 $3,808.4 $4,117.3 $4,142.6 $4,370.3 $4,230.5
Surplus to liabilities ratio 17.7% 18.0% 18.9% 19.9% 19.4% 20.0% 18.2%
--------
<CAPTION>
--------
4Q Full Year Full Year
1998 1997 1998
-------- -------- --------
<S> <C> <C> <C>
Individual life insurance:
Life insurance in force (in billions, face amt.):
Term $ 32.1 $ 30.1 $ 32.1
Permanent (universal and whole life) 23.3 21.5 23.3
-------- -------- --------
Total $ 55.4 $ 51.6 $ 55.4
======== ======== ========
Number of life policies in force (000) 518.1 528.3 518.1
Life insurance issued (in billions, face amt.) $ 2.6 $ 6.5 $ 8.9
Number of life policies issued (000) 7.4 24.5 29.2
Net written premiums and deposits:
Direct periodic premiums and deposits $ 89.2 $ 290.4 $ 321.5
Single premium deposits 23.7 56.4 85.1
Reinsurance (18.7) (58.3) (66.0)
-------- -------- --------
Total $ 94.2 $ 288.5 $ 340.6
======== ======== ========
Policyholder account balances & benefit reserves $2,436.1 $2,283.4 $2,436.1
Individual long term care insurance:
Number of policies in force (000) 122.2 102.1 122.2
Net earned premiums $ 53.7 $ 159.3 $ 199.8
Net written premiums $ 61.5 $ 183.8 $ 213.0
All businesses:
Net investment income $ 508.9 $1,835.1 $1,959.6
Interest credited to contractholders $ 230.8 $ 829.5 $ 876.4
Statutory data:
Travelers Insurance Company
Statutory capital and surplus $4,764.0 $4,117.3 $4,764.0
Surplus to liabilities ratio 19.6% 19.9% 19.6%
--------
</TABLE>
Page 22
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
PRIMERICA FINANCIAL SERVICES
(In millions of dollars)
<TABLE>
<CAPTION>
----------
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
--------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
NET REVENUES* $ 372 $ 378 $ 381 $ 391 $ 400 $ 420
CORE INCOME (1)
Life insurance $ 64 $ 69 $ 68 $ 71 $ 75 $ 80
Other financial products 14 13 17 19 20 23
--------- ---------- ---------- ---------- ---------- ----------
Total core business income $ 78 $ 82 $ 85 $ 90 $ 95 $ 103
========= ========== ========== ========== ========== ==========
Face value (in billions) of:
Life insurance issued $ 12.0 $ 14.1 $ 13.1 $ 13.4 $ 13.0 $ 15.8
Life insurance in force $ 361.5 $ 365.4 $ 368.1 $ 369.9 $ 372.5 $ 377.5
Number of life policies issued (000) 54.3 62.8 56.7 55.1 51.1 61.2
Number of life policies in force (000) 2,141.0 2,149.8 2,149.7 2,146.2 2,141.6 2,151.1
Annualized issued premiums $ 41.1 $ 47.9 $ 44.5 $ 43.1 $ 40.8 $ 48.7
Direct premiums $ 300.3 $ 303.2 $ 304.4 $ 305.8 $ 306.2 $ 312.3
Earned premiums:
PFS Individual term life $ 241.2 $ 243.5 $ 242.3 $ 240.1 $ 244.7 $ 248.8
Other 17.8 15.8 14.9 19.1 15.5 17.1
--------- ---------- ---------- ---------- ---------- ----------
Total $ 259.0 $ 259.3 $ 257.2 $ 259.2 $ 260.2 $ 265.9
========= ========== ========== ========== ========== ==========
Mutual fund sales at NAV:
Salomon Smith Barney Asset Management funds $ 317.3 $ 332.5 $ 316.5 $ 331.0 $ 335.6 $ 400.7
Other funds 203.8 200.9 197.9 202.0 228.8 308.6
--------- ---------- ---------- ---------- ---------- ----------
Total U.S. mutual fund sales 521.1 533.4 514.4 533.0 564.4 709.3
Mutual fund sales - Canada 200.9 136.0 121.5 129.1 204.3 123.9
--------- ---------- ---------- ---------- ---------- ----------
Total mutual fund sales $ 722.0 $ 669.4 $ 635.9 $ 662.1 $ 768.7 $ 833.2
========= ========== ========== ========== ========== ==========
Cash advanced on $.M.A.R.T. and $.A.F.E. loans (2) $ 289.4 $ 338.2 $ 315.5 $ 354.7 $ 316.6 $ 410.6
Variable annuity net written premiums and deposits $ 54.2 $ 79.8 $ 100.6 $ 111.9 $ 126.3 $ 175.2
SECURE net written premiums (3) $ 9.7 $ 15.2 $ 19.5 $ 28.2 $ 38.0 $ 55.8
Agents licensed for:
Life insurance 83,248 82,447 79,992 79,508 76,835 77,274
Mutual funds 28,736 29,453 29,956 27,464 28,475 28,864
$.M.A.R.T. / $.A.F.E. loans 89,679 94,117 98,847 93,228 96,188 96,422
Variable annuities 8,403 9,653 11,110 12,596 12,924 13,169
Home & auto insurance 6,638 7,228 7,990 8,658 10,051 11,123
Financial Needs Analyses submitted 88,010 111,482 132,141 122,169 140,617 130,549
----------
<CAPTION>
----------
3Q 4Q Full Year Full Year
1998 1998 1997 1998
---------- ---------- ---------- ----------
NET REVENUES* $ 413 $ 421 $ 1,522 $ 1,654
CORE INCOME (1)
Life insurance $ 77 $ 75 $ 272 $ 307
Other financial products 22 28 63 93
---------- ---------- ---------- ----------
Total core business income $ 99 $ 103 $ 335 $ 400
========== ========== ========== ==========
Face value (in billions) of:
Life insurance issued $ 14.2 $ 14.4 $ 52.6 $ 57.4
Life insurance in force $ 380.6 $ 383.7 $ 369.9 $ 383.7
Number of life policies issued (000) 55.6 55.7 228.9 223.6
Number of life policies in force (000) 2,153.1 2,151.8 2,146.2 2,151.8
Annualized issued premiums $ 45.0 $ 44.8 $ 176.6 $ 179.3
Direct premiums $ 311.6 $ 313.7 $ 1,213.7 $ 1,243.8
Earned premiums:
PFS Individual term life $ 246.1 $ 247.3 $ 967.1 $ 986.9
Other 15.1 22.6 67.6 70.3
---------- ---------- ---------- ----------
Total $ 261.2 $ 269.9 $ 1,034.7 $ 1,057.2
========== ========== ========== ==========
Mutual fund sales at NAV:
Salomon Smith Barney Asset Management funds $ 383.9 $ 341.4 $ 1,297.3 $ 1,461.6
Other funds 249.8 197.3 804.6 984.5
---------- ---------- ---------- ----------
Total U.S. mutual fund sales 633.7 538.7 2,101.9 2,446.1
Mutual fund sales - Canada 91.3 76.5 587.5 496.0
---------- ---------- ---------- ----------
Total mutual fund sales $ 725.0 $ 615.2 $ 2,689.4 $ 2,942.1
========== ========== ========== ==========
Cash advanced on $.M.A.R.T. and $.A.F.E. loans (2) $ 347.4 $ 386.5 $ 1,297.8 $ 1,461.0
Variable annuity net written premiums and deposits $ 171.9 $ 178.6 $ 346.5 $ 652.0
SECURE net written premiums (3) $ 60.8 $ 58.7 $ 72.6 $ 213.4
Agents licensed for:
Life insurance 79,081 80,725 79,508 80,725
Mutual funds 29,176 26,517 27,464 26,517
$.M.A.R.T. / $.A.F.E. loans 117,704 129,310 93,228 129,310
Variable annuities 11,839 13,434 12,596 13,434
Home & auto insurance 12,683 14,083 8,658 14,083
Financial Needs Analyses submitted 132,771 131,080 453,802 535,017
----------
</TABLE>
(1) The 4th quarter 1998 reflects a one time $4.5 million reclass of income
from life insurance to other financial products as a result of bank
holding company requirements.
(2) The $.M.A.R.T. and $.A.F.E. loan products are marketed by PFS; the
receivables are reflected in the assets of Consumer Finance Services.
(3) The SECURE property casualty insurance products are marketed by PFS; the
premiums are reflected in the operating earnings of Travelers Property
Casualty Corp.
* Revenues (excluding realized gains), net of interest expense.
Page 23
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
TRAVELERS PROPERTY CASUALTY - PERSONAL LINES
(In millions of dollars)
<TABLE>
<CAPTION>
------ ------
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
1997 1997 1997 1997 1998 1998 1998 1998
------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET REVENUES* $ 796 $ 810 $ 831 $ 839 $ 868 $ 899 $ 924 $ 975
CORE INCOME $ 79 $ 75 $ 71 $ 75 $ 82 $ 81 $ 68 $ 88
Net written premiums by product line: (1)
Auto $478.0 $477.9 $490.9 $503.8 $555.7 $578.3 $590.8 $603.0
Homeowners and other 296.9 267.0 283.9 275.8 250.3 295.6 317.9 298.5
------ ------ ------ ------ ------ ------ ------ ------
Total net written premiums $774.9 $744.9 $774.8 $779.6 $806.0 $873.9 $908.7 $901.5
====== ====== ====== ====== ====== ====== ====== ======
Net written premiums by distribution channel: (1)
Independent agents $707.4 $654.0 $673.2 $668.3 $682.5 $718.0 $731.8 $720.3
Affinity group marketing 36.7 43.9 49.2 50.3 53.4 61.0 72.9 76.9
SECURE 9.7 15.2 19.5 28.2 38.0 55.8 60.8 58.7
Joint marketing arrangements 21.1 31.8 32.9 32.8 32.1 39.1 43.2 45.6
------ ------ ------ ------ ------ ------ ------ ------
Total net written premiums $774.9 $744.9 $774.8 $779.6 $806.0 $873.9 $908.7 $901.5
====== ====== ====== ====== ====== ====== ====== ======
Statutory ratio development:
Earned premiums $709.6 $718.9 $743.6 $745.0 $770.8 $802.5 $835.7 $862.4
Losses and loss adjustment expenses 434.4 466.7 474.9 476.8 502.7 523.5 580.9 574.1
Other underwriting expenses 223.9 207.5 225.8 225.5 226.0 242.1 243.5 238.8
------ ------ ------ ------ ------ ------ ------ ------
Total deductions 658.3 674.2 700.7 702.3 728.7 765.6 824.4 812.9
------ ------ ------ ------ ------ ------ ------ ------
Statutory underwriting gain $ 51.3 $ 44.7 $ 42.9 $ 42.7 $ 42.1 $ 36.9 $ 11.3 $ 49.5
====== ====== ====== ====== ====== ====== ====== ======
Statutory combined ratio: (1)
Loss and loss adjustment expense ratio 61.2% 64.9% 63.9% 64.0% 65.2% 65.2% 69.5% 66.6%
Other underwriting expense ratio 28.9% 27.9% 29.1% 28.9% 28.0% 27.7% 26.8% 26.5%
------ ------ ------ ------ ------ ------ ------ ------
Combined ratio 90.1% 92.8% 93.0% 92.9% 93.2% 92.9% 96.3% 93.1%
====== ====== ====== ====== ====== ====== ====== ======
Net investment income (pre-tax) $ 86.0 $ 87.7 $ 86.1 $ 93.2 $ 95.4 $ 94.8 $ 88.6 $109.6
Effective tax rate on net investment income 31.1% 30.8% 30.4% 29.3% 29.4% 28.5% 27.4% 28.7%
Catastrophe losses, net of reinsurance (after-tax) $ -- $ 4.5 $ -- $ 5.3 $ 8.6 $ 13.1 $ 21.8 $ --
------ ------
<CAPTION>
Full Year Full Year
1997 1998
-------- --------
<S> <C> <C>
NET REVENUES* $ 3,276 $ 3,666
CORE INCOME $ 300 $ 319
Net written premiums by product line: (1)
Auto $1,950.6 $2,327.8
Homeowners and other 1,123.6 1,162.3
-------- --------
Total net written premiums $3,074.2 $3,490.1
======== ========
Net written premiums by distribution channel: (1)
Independent agents $2,702.9 $2,852.6
Affinity group marketing 180.1 264.2
SECURE 72.6 213.3
Joint marketing arrangements 118.6 160.0
-------- --------
Total net written premiums $3,074.2 $3,490.1
======== ========
Statutory ratio development:
Earned premiums $2,917.1 $3,271.4
Losses and loss adjustment expenses 1,852.8 2,181.2
Other underwriting expenses 882.7 950.4
-------- --------
Total deductions 2,735.5 3,131.6
-------- --------
Statutory underwriting gain $ 181.6 $ 139.8
======== ========
Statutory combined ratio: (1)
Loss and loss adjustment expense ratio 63.5% 66.7%
Other underwriting expense ratio 28.7% 27.2%
-------- --------
Combined ratio 92.2% 93.9%
======== ========
Net investment income (pre-tax) $ 353.0 $ 388.4
Effective tax rate on net investment income 30.4% 28.5%
Catastrophe losses, net of reinsurance (after-tax) $ 9.8 $ 43.5
</TABLE>
(1) The first quarter and full year 1997 net written premiums include an
adjustment associated with a reinsurance transaction, which increased
homeowners premiums written by independent agents by $68.7 million.
Excluding this transaction, the loss and loss adjustment expense ratio,
other underwriting expense ratio and combined ratio for the 1997 first
quarter were 61.2%, 28.6% and 89.8%, respectively, and for the 1997 full
year were 63.5%, 28.6% and 92.1%, respectively.
* Revenues (excluding realized gains), net of interest expense.
Page 24
<PAGE>
GLOBAL CONSUMER citigroup [LOGO]
EUROPE, MIDDLE EAST AND AFRICA
(In millions of dollars)
<TABLE>
<CAPTION>
---- ----
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
---- ---- ---- ---- ---- ---- ---- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $457 $465 $466 $476 $454 $479 $496 $525 $1,864 $1,954
Adjusted Operating Expense 339 328 320 336 319 338 329 360 1,323 1,346
Credit Costs (1) 70 69 68 67 70 67 72 83 274 292
---- ---- ---- ---- ---- ---- ---- ---- ------ ------
Core Income Before Taxes 48 68 78 73 65 74 95 82 267 316
Income Taxes 23 30 34 42 28 45 48 40 129 161
---- ---- ---- ---- ---- ---- ---- ---- ------ ------
Core Income $ 25 $ 38 $ 44 $ 31 $ 37 $ 29 $ 47 $ 42 $ 138 $ 155
==== ==== ==== ==== ==== ==== ==== ==== ====== ======
Average Assets (in billions of dollars) $ 21 $ 21 $ 21 $ 21 $ 21 $ 21 $ 21 $ 22 $ 21 $ 21
==== ==== ==== ==== ==== ==== ==== ==== ====== ======
Return on Assets 0.48% 0.73% 0.83% 0.59% 0.71% 0.55% 0.89% 0.76% 0.66% 0.74%
==== ==== ==== ==== ==== ==== ==== ==== ====== ======
---- ----
</TABLE>
ASIA PACIFIC
(In millions of dollars)
<TABLE>
<CAPTION>
---- ----
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
---- ---- ---- ---- ---- ---- ---- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $455 $476 $459 $409 $399 $438 $442 $494 $1,799 $1,773
Adjusted Operating Expense 243 260 267 254 235 253 232 248 1,024 968
Credit Costs (1) 44 49 49 59 50 64 63 74 201 251
---- ---- ---- ---- ---- ---- ---- ---- ------ ------
Core Income Before Taxes 168 167 143 96 114 121 147 172 574 554
Income Taxes 47 45 32 22 27 27 38 52 146 144
---- ---- ---- ---- ---- ---- ---- ---- ------ ------
Core Income $121 $122 $111 $ 74 $ 87 $ 94 $109 $120 $ 428 $ 410
==== ==== ==== ==== ==== ==== ==== ==== ====== ======
Average Assets (in billions of dollars) $ 27 $ 28 $ 28 $ 27 $ 27 $ 28 $ 28 $ 29 $ 28 $ 28
==== ==== ==== ==== ==== ==== ==== ==== ====== ======
Return on Assets 1.82% 1.75% 1.57% 1.09% 1.31% 1.35% 1.54% 1.64% 1.53% 1.46%
==== ==== ==== ==== ==== ==== ==== ==== ====== ======
---- ----
</TABLE>
(1) Represents provision for loan losses.
Page 25
<PAGE>
GLOBAL CONSUMER citigroup[LOGO]
LATIN AMERICA
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 356 $ 370 $ 357 $ 363 $ 345 $ 360 $ 422 $ 435 $1,446 $1,562
Adjusted Operating Expense 213 230 232 248 233 248 287 303 923 1,071
Credit Costs (1) 48 50 48 46 49 61 74 81 192 265
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income Before Taxes 95 90 77 69 63 51 61 51 331 226
Income Taxes 15 13 18 12 17 9 15 22 58 63
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income $ 80 $ 77 $ 59 $ 57 $ 46 $ 42 $ 46 $ 29 $ 273 $ 163
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Average Assets (in billions
of dollars) $ 8 $ 8 $ 9 $ 9 $ 9 $ 10 $ 13 $ 14 $ 8 $ 12
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Return on Assets 4.06% 3.86% 2.60% 2.51% 2.07% 1.68% 1.40% 0.82% 3.41% 1.36%
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
</TABLE>
(1) Represents provision for loan losses.
GLOBAL CONSUMER
GLOBAL PRIVATE BANK
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Adjusted Revenues $ 246 $ 249 $ 264 $ 259 $ 250 $ 272 $ 266 $ 273 $1,018 $1,061
Adjusted Operating Expense 152 166 172 180 177 182 180 186 670 725
Credit Costs (1) (1) (1) (8) (9) (8) (3) (7) 2 (19) (16)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income Before Taxes 95 84 100 88 81 93 93 85 367 352
Income Taxes 24 18 21 23 22 28 28 20 86 98
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income $ 71 $ 66 $ 79 $ 65 $ 59 $ 65 $ 65 $ 65 $ 281 $ 254
====== ====== ====== ------ ====== ====== ====== ------ ====== ======
Average Assets (in
billions of dollars) $ 17 $ 17 $ 17 $ 17 $ 16 $ 16 $ 17 $ 18 $ 17 $ 17
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Return on Assets 1.69% 1.56% 1.84% 1.52% 1.50% 1.63% 1.52% 1.43% 1.65% 1.49%
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
</TABLE>
(1) Represents provision for loan losses, net cost to carry, and net OREO
benefits (costs).
Page 26
<PAGE>
GLOBAL CONSUMER citigroup[LOGO]
e-CITI (1)
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 24 $ 26 $ 30 $ 32 $ 29 $ 34 $ 37 $ 47 $ 112 $ 147
Adjusted Operating Expense 43 51 67 78 78 93 91 117 239 379
Credit Costs (2) 1 1 1 1 1 1 -- 1 4 3
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
Core Income Before Taxes (20) (26) (38) (47) (50) (60) (54) (71) (131) (235)
Income Taxes (9) (10) (14) (19) (22) (23) (20) (28) (52) (93)
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
Core Income $ (11) $ (16) $ (24) $ (28) $ (28) $ (37) $ (34) $ (43) $ (79) $(142)
===== ===== ===== ----- ===== ===== ===== ----- ===== =====
</TABLE>
(1) Includes development of electronic banking initiatives.
(2) Represents provision for loan losses.
GLOBAL CONSUMER
OTHER (1)
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 26 $ 29 $ 26 $ 24 $ 27 $ 21 $ 23 $ 26 $ 105 $ 97
Operating Expense 12 20 22 36 29 44 71 92 90 236
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
Core Income Before Taxes 14 9 4 (12) (2) (23) (48) (66) 15 (139)
Income Taxes 5 (1) (4) (9) -- (10) (19) (24) (9) (53)
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
Core Income $ 9 $ 10 $ 8 $ (3) $ (2) $ (13) $ (29) $ (42) $ 24 $ (86)
===== ===== ===== ----- ===== ===== ===== ----- ===== =====
Average Assets (in
billions of dollars) $ -- $ -- $ -- $ -- $ 1 $ 1 $ 2 $ 4 $ -- $ 2
===== ===== ===== ----- ===== ===== ===== ----- ===== =====
</TABLE>
(1) Includes unallocated marketing and staff expenses.
Page 27
<PAGE>
GLOBAL CORPORATE citigroup[LOGO]
SALOMON SMITH BARNEY - Page 1
(In millions of dollars)
(excluding Asset Management division)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Revenues:
Commissions $ 713.2 $ 682.8 $ 780.8 $ 779.0 $ 792.5 $ 781.0
Asset management and administration fees 221.1 225.9 261.5 289.2 295.9 339.7
Investment banking 475.6 469.3 578.7 558.3 616.2 632.5
Principal transactions 761.8 708.4 788.5 242.3 778.8 314.9
Other income 32.4 25.6 47.7 43.1 33.4 49.8
--------- --------- --------- --------- --------- ---------
Total non-interest revenues 2,204.1 2,112.0 2,457.2 1,911.9 2,516.8 2,117.9
--------- --------- --------- --------- --------- ---------
Interest and dividends 2,487.3 3,003.6 3,203.3 3,335.2 3,315.0 3,464.8
Interest expense 2,160.1 2,568.2 2,832.3 2,935.7 2,914.0 3,059.9
--------- --------- --------- --------- --------- ---------
Net interest and dividends 327.2 435.4 371.0 399.5 401.0 404.9
--------- --------- --------- --------- --------- ---------
Total revenues, net of interest expense 2,531.3 2,547.4 2,828.2 2,311.4 2,917.8 2,522.8
--------- --------- --------- --------- --------- ---------
Non-interest expenses:
Compensation and benefits 1,443.9 1,407.0 1,589.3 1,451.5 1,680.0 1,499.7
Communications 118.5 121.7 124.5 120.2 114.2 113.0
Occupancy and equipment 102.5 105.6 104.7 104.1 101.0 101.5
Floor brokerage and other production 85.2 86.3 98.2 117.0 108.9 105.1
Other operating and administrative expenses 174.2 166.5 179.6 194.1 202.6 161.5
--------- --------- --------- --------- --------- ---------
Total noninterest expenses 1,924.3 1,887.1 2,096.3 1,986.9 2,206.7 1,980.8
--------- --------- --------- --------- --------- ---------
Core Income before income taxes 607.0 660.3 731.9 324.5 711.1 542.0
Provision for income taxes 239.5 256.2 282.9 106.9 268.6 194.4
--------- --------- --------- --------- --------- ---------
Core Income $ 367.5 $ 404.1 $ 449.0 $ 217.6 $ 442.5 $ 347.6
========= ========= ========= --------- ========= =========
Total equity (in billions) (1) $ 7.9 $ 8.1 $ 8.4 $ 8.5 $ 8.9 $ 9.3
Return on equity (1) 21.7% 23.2% 25.3% 12.5% 23.1% 18.2%
Pre-tax profit margin 24.0% 25.9% 25.9% 14.0% 24.4% 21.5%
Non-compensation expenses as a percent of
net revenues 19.0% 18.8% 17.9% 23.2% 18.1% 19.1%
</TABLE>
<TABLE>
<CAPTION>
3Q 4Q Full Year Full Year
1998 1998 1997 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenues:
Commissions $ 794.1 $ 835.3 $ 2,955.8 $ 3,202.9
Asset management and administration fees 345.3 327.0 997.7 1,307.9
Investment banking 514.1 518.4 2,081.9 2,281.2
Principal transactions (1,331.8) 122.5 2,501.0 (115.6)
Other income 32.6 84.0 148.8 199.8
--------- --------- --------- ---------
Total non-interest revenues 354.3 1,887.2 8,685.2 6,876.2
--------- --------- --------- ---------
Interest and dividends 3,335.7 2,773.8 12,029.4 12,889.3
Interest expense 3,005.0 2,453.7 10,496.3 11,432.6
--------- --------- --------- ---------
Net interest and dividends 330.7 320.1 1,533.1 1,456.7
--------- --------- --------- ---------
Total revenues, net of interest expense 685.0 2,207.3 10,218.3 8,332.9
--------- --------- --------- ---------
Non-interest expenses:
Compensation and benefits 874.9 1,617.7 5,891.7 5,672.3
Communications 115.7 123.0 484.9 465.9
Occupancy and equipment 101.3 109.7 416.9 413.5
Floor brokerage and other production 108.2 119.9 386.7 442.1
Other operating and administrative expenses 125.7 218.3 714.4 708.1
--------- --------- --------- ---------
Total noninterest expenses 1,325.8 2,188.6 7,894.6 7,701.9
--------- --------- --------- ---------
Core Income before income taxes (640.8) 18.7 2,323.7 631.0
Provision for income taxes (245.3) 5.5 885.5 223.2
--------- --------- --------- ---------
Core Income $ (395.5) $ 13.2 $ 1,438.2 $ 407.8
========= --------- ========= =========
Total equity (in billions) (1) $ 8.7 $ 8.9 $ 8.5 $ 8.9
Return on equity (1) -14.5% 3.4% 20.5% 7.5%
Pre-tax profit margin -93.5% 0.8% 22.7% 7.6%
Non-compensation expenses as a percent of
net revenues 65.8% 25.9% 19.6% 24.4%
</TABLE>
(1) Total equity and return on equity for Salomon Smith Barney in total
(includes Salomon Smith Barney Asset Management).
Page 28
<PAGE>
GLOBAL CORPORATE citigroup[LOGO]
SALOMON SMITH BARNEY - Page 2
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Client Assets (in billions)
Assets under fee-based management:
Financial Consultant managed accounts $ 8.5 $ 9.8 $ 11.1 $ 11.6 $ 13.3 $ 14.3
Consulting Group externally managed assets 46.7 53.1 58.4 59.7 67.1 69.3
---------- ---------- ---------- ---------- ---------- ----------
Total assets under fee-based management $ 55.2 $ 62.9 $ 69.5 $ 71.3 $ 80.4 $ 83.6
========== ========== ========== ---------- ========== ==========
Total client assets $ 543.5 $ 593.0 $ 630.4 $ 654.0 $ 703.0 $ 724.3
Private Client
Registered Financial Consultants 10,430 10,359 10,288 10,319 10,321 10,494
Annualized retail gross production per FC (000) $ 392 $ 359 $ 428 $ 416 $ 452 $ 441
Domestic retail offices 443 438 434 430 432 439
Investment Banking and Public Finance
Underwriting (full credit to lead mgr.):
Debt and equity
Global volume $ 45,098.6 $ 49,432.2 $ 60,105.5 $ 43,673.5 $ 73,904.2 $ 79,266.5
Global market share 9.6% 9.9% 11.6% 10.0% 10.0% 10.9%
Rank 2 2 2 2 3 2
U.S. volume $ 39,310.5 $ 39,015.2 $ 53,971.9 $ 40,392.5 $ 66,995.4 $ 72,749.9
U.S. market share 13.5% 12.4% 14.5% 12.1% 13.2% 14.0%
Rank 2 2 2 2 2 2
Municipals (1)
Volume $ 5,426.1 $ 6,472.0 $ 6,762.9 $ 7,083.3 $ 8,439.4 $ 10,850.8
Market share 13.7% 11.3% 11.4% 10.9% 11.8% 13.8%
Rank 1 1 2 2 1 1
Capital Markets/Research
Number of institutional salespeople 907 943 952 878 877 854
Number of stocks in which markets are made 1,595 1,601 1,531 1,554 1,464 1,465
% of S&P sectors covered by research 98% 98% 98% 99% 99% 99%
</TABLE>
<TABLE>
<CAPTION>
3Q 4Q Full Year Full Year
1998 1998 1997 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Client Assets (in billions)
Assets under fee-based management:
Financial Consultant managed accounts $ 13.8 $ 16.5 $ 11.6 $ 16.5
Consulting Group externally managed assets 63.9 71.9 59.7 71.9
---------- ---------- ---------- ----------
Total assets under fee-based management $ 77.7 $ 88.4 $ 71.3 $ 88.4
========== ---------- ========== ==========
Total client assets $ 697.5 $ 773.8 $ 654.0 $ 773.8
Private Client
Registered Financial Consultants 10,573 10,803 10,319 10,803
Annualized retail gross production per FC (000) $ 431 $ 413 $ 399 $ 434
Domestic retail offices 442 449 430 449
Investment Banking and Public Finance
Underwriting (full credit to lead mgr.):
Debt and equity
Global volume $ 49,180.0 $ 50,510.0 $190,807.6 $252,860.7
Global market share 8.8% 9.1% 10.0% 9.8%
Rank 3 3 2 3
U.S. volume $ 41,816.3 $ 43,720.9 $169,238.7 $225,282.5
U.S. market share 10.3% 11.2% 12.9% 12.4%
Rank 3 2 2 2
Municipals (1)
Volume $ 9,606.6 $ 7,171.6 $ 24,986.3 $ 36,068.4
Market share 14.5% 10.3% 11.3% 12.6%
Rank 1 2 1 1
Capital Markets/Research
Number of institutional salespeople 869 884 878 884
Number of stocks in which markets are made 1,418 1,329 1,554 1,329
% of S&P sectors covered by research 99% 98% 99% 98%
</TABLE>
(1) Total long term excluding private placement.
Page 29
<PAGE>
GLOBAL CORPORATE citigroup[LOGO]
EMERGING MARKETS BANKING
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Adjusted Revenues $ 818 $ 779 $ 866 $ 720 $ 885 $ 904 $ 697 $ 936 $3,183 $3,422
Adjusted Operating Expense 432 460 485 516 480 509 516 512 1,893 2,017
Credit Costs (1) 19 28 35 53 73 93 212 102 135 480
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income Before Taxes 367 291 346 151 332 302 (31) 322 1,155 925
Income Taxes 59 43 69 75 49 96 (12) 102 246 235
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income $ 308 $ 248 $ 277 $ 76 $ 283 $ 206 $ (19) $ 220 $ 909 $ 690
====== ====== ====== ------ ====== ====== ====== ------ ====== ======
Average Assets (in billions
of dollars) $ 60 $ 63 $ 68 $ 73 $ 78 $ 79 $ 81 $ 84 $ 66 $ 81
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Return on Assets 2.08% 1.58% 1.62% 0.41% 1.47% 1.05% -- 1.04% 1.38% 0.85%
====== ====== ====== ------ ====== ====== ====== ------ ====== ======
</TABLE>
GLOBAL RELATIONSHIP BANKING
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Adjusted Revenues $ 889 $ 825 $ 858 $ 928 $ 903 $1,069 $ 706 $ 830 $3,500 $3,508
Adjusted Operating Expense 664 687 720 750 745 822 817 834 2,821 3,218
Credit Costs (1) (40) (61) (39) (30) (20) (53) 19 (59) (170) (113)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income Before Taxes 265 199 177 208 178 300 (130) 55 849 403
Income Taxes 118 49 40 83 69 125 (36) 25 290 183
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Core Income $ 147 $ 150 $ 137 $ 125 $ 109 $ 175 $ (94) $ 30 $ 559 $ 220
====== ====== ====== ------ ====== ====== ====== ------ ====== ======
Average Assets (in billions
of dollars) $ 79 $ 80 $ 82 $ 82 $ 86 $ 89 $ 91 $ 91 $ 81 $ 89
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Return on Assets 0.75% 0.75% 0.66% 0.60% 0.51% 0.79% -- 0.13% 0.69% 0.25%
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
</TABLE>
(1) Represents provision for loan losses, net cost to carry, and net OREO
benefits (costs).
Page 30
<PAGE>
GLOBAL CORPORATE citigroup[LOGO]
TRAVELERS PROPERTY CASUALTY - COMMERCIAL LINES
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
NET REVENUES* $ 1,587 $ 1,588 $ 1,578 $ 1,550 $ 1,619 $ 1,584
CORE INCOME $ 141 $ 155 $ 170 $ 166 $ 171 $ 174
Net written premiums by market: (1)
National accounts $ 221.6 $ 149.7 $ 151.1 $ 134.6 $ 186.6 $ 121.6
Commercial accounts 560.5 453.0 502.3 470.3 462.6 440.8
Select accounts 363.7 369.6 353.9 345.1 378.6 393.7
Specialty accounts 192.6 168.4 169.1 151.9 184.0 164.7
-------- -------- -------- -------- -------- --------
Total net written premiums $1,338.4 $1,140.7 $1,176.4 $1,101.9 $1,211.8 $1,120.8
======== ======== ======== -------- ======== ========
Statutory ratio development:
Earned premiums $1,090.4 $1,092.6 $1,061.8 $1,063.8 $1,126.2 $1,093.6
Losses and loss adjustment expenses 891.4 849.6 821.0 816.1 880.5 864.2
Other underwriting expenses 367.3 363.7 375.1 349.4 346.0 345.6
-------- -------- -------- -------- -------- --------
Total deductions 1,258.7 1,213.3 1,196.1 1,165.5 1,226.5 1,209.8
-------- -------- -------- -------- -------- --------
Statutory underwriting loss $ (168.3) $ (120.7) $ (134.3) $ (101.7) $ (100.3) $ (116.2)
======== ======== ======== -------- ======== ========
Statutory combined ratio: (1), (2)
Loss and loss adjustment expense ratio 81.7% 77.8% 77.3% 76.7% 78.2% 79.0%
Other underwriting expense ratio 27.4% 31.9% 31.9% 31.7% 28.6% 30.8%
-------- -------- -------- -------- -------- --------
Combined ratio 109.1% 109.7% 109.2% 108.4% 106.8% 109.8%
======== ======== ======== ======== ======== ========
Net investment income (pre-tax) $ 413.7 $ 417.6 $ 441.5 $ 422.6 $ 412.5 $ 424.3
Effective tax rate on net investment income 30.5% 29.9% 29.9% 28.1% 28.0% 27.5%
Catastrophe losses, net of reinsurance (after-tax) $ 4.9 $ 0.2 $ -- $ -- $ -- $ 10.4
</TABLE>
<TABLE>
<CAPTION>
3Q 4Q Full Year Full Year
1998 1998 1997 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
NET REVENUES* $ 1,604 $ 1,674 $ 6,303 $ 6,481
CORE INCOME $ 177 $ 201 $ 632 $ 723
Net written premiums by market: (1)
National accounts $ 175.3 $ 140.9 $ 657.0 $ 624.4
Commercial accounts 446.0 450.7 1,986.1 1,800.1
Select accounts 365.7 356.3 1,432.3 1,494.3
Specialty accounts 181.2 164.8 682.0 694.7
-------- -------- -------- --------
Total net written premiums $1,168.2 $1,112.7 $4,757.4 $4,613.5
======== -------- ======== ========
Statutory ratio development:
Earned premiums $1,139.2 $1,157.8 $4,308.6 $4,516.8
Losses and loss adjustment expenses 896.6 906.3 3,378.1 3,547.6
Other underwriting expenses 341.7 336.4 1,455.5 1,369.7
-------- -------- -------- --------
Total deductions 1,238.3 1,242.7 4,833.6 4,917.3
-------- -------- -------- --------
Statutory underwriting loss $ (99.1) $ (84.9) $ (525.0) $ (400.5)
======== -------- ======== ========
Statutory combined ratio: (1), (2)
Loss and loss adjustment expense ratio 78.7% 78.3% 78.4% 78.5%
Other underwriting expense ratio 29.3% 30.2% 30.6% 29.7%
-------- -------- -------- --------
Combined ratio 108.0% 108.5% 109.0% 108.2%
======== ======== ======== ========
Net investment income (pre-tax) $ 411.8 $ 460.7 $1,695.4 $1,709.3
Effective tax rate on net investment income 26.9% 27.6% 29.6% 27.5%
Catastrophe losses, net of reinsurance (after-tax) $ 14.9 $ -- $ 5.1 $ 25.3
</TABLE>
(1) First quarter and full year 1997 net written premiums include an increase of
$142.4 million due to a change to conform Aetna P&C's and Travelers P&C's
methods of recording net written premiums. Excluding this transaction, the loss
and loss adjustment expense ratio, other underwriting expense ratio and combined
ratio for the 1997 first quarter were 81.7%, 28.8% and 110.5%, respectively, and
for the 1997 full year were 78.4%, 31.1% and 109.5% respectively.
(2) Before policyholder dividends.
* Revenues (excluding realized gains), net of interest expense.
Page 31
<PAGE>
SSB CITI ASSET MANAGEMENT GROUP citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Revenues:
Investment advisory, admin. & distribution fees $ 230.2 $ 243.2 $ 262.4 $ 269.1 $ 285.7 $ 300.7
Unit Investment Trust revenues - net 8.7 6.8 19.0 4.9 12.6 7.6
Other revenues 11.5 15.3 8.7 6.0 12.0 5.6
-------- -------- -------- -------- -------- --------
Total revenues 250.4 265.3 290.1 280.0 310.3 313.9
Interest expense 8.9 9.8 8.3 7.1 8.4 7.6
-------- -------- -------- -------- -------- --------
Total revenues, net of interest expense 241.5 255.5 281.8 272.9 301.9 306.3
-------- -------- -------- -------- -------- --------
Expenses:
Employee compensation and benefits 63.9 66.7 76.2 83.7 83.9 84.2
Deferred commission amortization 32.9 31.2 32.0 28.4 34.9 31.6
Other expenses 64.6 69.5 67.7 67.6 70.0 77.2
-------- -------- -------- -------- -------- --------
Total expenses 161.4 167.4 175.9 179.7 188.8 193.0
-------- -------- -------- -------- -------- --------
Core income before income taxes 80.1 88.1 105.9 93.2 113.1 113.3
Provision for income taxes 26.5 29.8 35.2 32.6 38.5 38.8
-------- -------- -------- -------- -------- --------
Core income $ 53.6 $ 58.3 $ 70.7 $ 60.6 $ 74.6 $ 74.5
======== ======== ======== -------- ======== ========
Pre-tax profit margin 32.0% 33.2% 36.5% 33.3% 36.5% 36.1%
Assets under management (in billions):
Money market and other short term funds $ 55.7 $ 56.4 $ 58.6 $ 60.5 $ 67.5 $ 66.2
-------- -------- -------- -------- -------- --------
Mutual funds:
Equity / Balanced 28.9 31.1 33.0 37.7 42.5 43.6
Taxable Fixed Income 38.2 40.7 42.5 45.3 47.2 51.0
Tax Exempt Fixed Income 8.5 8.8 9.0 9.4 9.6 9.8
Annuities 2.5 2.8 3.1 3.2 3.7 3.3
-------- -------- -------- -------- -------- --------
Total mutual funds 78.1 83.4 87.6 95.6 103.0 107.7
-------- -------- -------- -------- -------- --------
Managed accounts
Private client 26.6 29.4 30.6 31.1 33.7 37.9
Institutional 68.3 73.1 75.2 74.0 76.5 82.6
-------- -------- -------- -------- -------- --------
Total managed accounts 94.9 102.5 105.8 105.1 110.2 120.5
-------- -------- -------- -------- -------- --------
Total Assets Under Management $ 228.7 $ 242.3 $ 252.0 $ 261.2 $ 280.7 $ 294.4
======== ======== ======== -------- ======== ========
Unit Investment Trusts held in client accounts $ 9.4 $ 9.3 $ 11.6 $ 11.8 $ 13.1 $ 12.9
Number of Morningstar 4- and 5-star funds 15 17 17 21 23 25
Consolidated Citigroup
Assets Under Management (in billions)
SSB Citi Asset Management Group $ 228.7 $ 242.3 $ 252.0 $ 261.2 $ 280.7 $ 294.4
SSB - Financial Consultant managed accounts 8.5 9.8 11.1 11.6 13.3 14.3
Travelers Life and Annuity 21.4 22.2 22.9 23.8 25.2 24.3
-------- -------- -------- -------- -------- --------
Total assets managed for third parties $ 258.6 $ 274.3 $ 286.0 $ 296.6 $ 319.2 $ 333.0
======== ======== ======== -------- ======== ========
</TABLE>
<TABLE>
<CAPTION>
3Q 4Q Full Year Full Year
1998 1998 1997 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
Investment advisory, admin. & distribution fees $ 297.8 $ 313.9 $1,004.9 $1,198.1
Unit Investment Trust revenues - net 17.5 4.4 39.4 42.1
Other revenues 7.8 11.6 41.5 37.0
-------- -------- -------- --------
Total revenues 323.1 329.9 1,085.8 1,277.2
Interest expense 8.3 8.7 34.1 33.0
-------- -------- -------- --------
Total revenues, net of interest expense 314.8 321.2 1,051.7 1,244.2
-------- -------- -------- --------
Expenses:
Employee compensation and benefits 93.3 115.7 290.5 377.1
Deferred commission amortization 31.1 28.0 124.5 125.6
Other expenses 77.8 92.7 269.4 317.7
-------- -------- -------- --------
Total expenses 202.2 236.4 684.4 820.4
-------- -------- -------- --------
Core income before income taxes 112.6 84.8 367.3 423.8
Provision for income taxes 39.8 33.4 124.1 150.5
-------- -------- -------- --------
Core income $ 72.8 $ 51.4 $ 243.2 $ 273.3
======== -------- ======== ========
Pre-tax profit margin 34.8% 25.7% 33.8% 33.2%
Assets under management (in billions):
Money market and other short term funds $ 71.8 $ 77.8 $ 60.5 $ 77.8
-------- -------- -------- --------
Mutual funds:
Equity / Balanced 38.7 43.2 37.7 43.2
Taxable Fixed Income 52.8 55.1 45.3 55.1
Tax Exempt Fixed Income 10.4 10.8 9.4 10.8
Annuities 3.1 3.7 3.2 3.7
-------- -------- -------- --------
Total mutual funds 105.0 112.8 95.6 112.8
-------- -------- -------- --------
Managed accounts
Private client 35.2 40.3 31.1 40.3
Institutional 82.0 96.1 74.0 96.1
-------- -------- -------- --------
Total managed accounts 117.2 136.4 105.1 136.4
-------- -------- -------- --------
Total Assets Under Management $ 294.0 $ 327.0 $ 261.2 $ 327.0
======== -------- ======== ========
Unit Investment Trusts held in client accounts $ 12.4 $ 13.2 $ 11.8 $ 13.2
Number of Morningstar 4- and 5-star funds 24 24 21 24
Consolidated Citigroup
Assets Under Management (in billions)
SSB Citi Asset Management Group $ 294.0 $ 327.0 $ 261.2 $ 327.0
SSB - Financial Consultant managed accounts 13.8 16.5 11.6 16.5
Travelers Life and Annuity 25.7 26.0 23.8 26.0
-------- -------- -------- --------
Total assets managed for third parties $ 333.5 $ 369.5 $ 296.6 $ 369.5
======== -------- ======== ========
</TABLE>
Page 32
<PAGE>
INVESTMENT ACTIVITIES citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full Year Full Year
1997 1997 1997 1997 1998 1998 1998 1998 1997 1998
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Core Income:
Proprietary Investments $ 17 $ 142 $ 130 $ 165 $ 150 $ 152 $ 50 $ (66) $ 454 $ 286
LDC Debt Sales 44 90 125 216 208 185 16 13 475 422
Portfolio Gains 9 6 82 144 87 28 25 50 241 190
Refinancing 104 8 5 5 18 4 5 4 122 31
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total Core Income $ 174 $ 246 $ 342 $ 530 $ 463 $ 369 $ 96 $ 1 $1,292 $ 929
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
INVESTMENT PORTFOLIO (1) 1997 1997 1997 1997 1998 1998 1998 1998
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Fixed-income investments:
Available for sale, at market:
Mortgage-backed securities - principally
obligations of U.S. Government agencies $ 8,842 $ 9,120 $ 9,040 $ 8,998 $ 8,726 $ 8,693 $ 9,663 $ 9,599
U.S. Treasury securities and obligations of U.S.
Government corporations and agencies 3,014 3,242 3,571 3,962 3,912 4,281 4,977 4,144
Corporates (including redeemable preferreds) 24,714 26,331 27,029 27,025 27,428 27,176 26,796 26,437
Obligations of states and political subdivisions 5,337 5,857 6,812 8,110 9,124 10,107 10,854 10,977
Debt securities issued by foreign governments 1,236 1,384 1,379 1,326 1,339 1,166 997 1,603
Held to maturity, at amortized cost 49 46 43 41 38 36 33 30
------- ------- ------- ------- ------- ------- ------- -------
Total fixed income 43,192 45,980 47,874 49,462 50,567 51,459 53,320 52,790
Equity securities, at market 1,296 1,377 1,609 1,624 1,541 1,503 1,368 1,423
Short-term and other 5,878 5,135 4,159 5,077 6,709 6,179 7,477 5,757
------- ------- ------- ------- ------- ------- ------- -------
Total investments held by Insurance companies (2) 50,366 52,492 53,642 56,163 58,817 59,141 62,165 59,970
Proprietary Investments 3,362 3,467 3,802 3,886 4,295 4,608 4,500 4,598
LDC Debt 5,975 5,916 5,792 5,403 5,236 4,074 3,280 3,320
Refinancing 160 155 116 109 121 118 125 92
------- ------- ------- ------- ------- ------- ------- -------
Total invested assets $59,863 $62,030 $63,352 $65,561 $68,469 $67,941 $70,070 $67,980
======= ======= ======= ======= ======= ======= ======= =======
After tax unrealized gains (losses) on invested assets $ 556 $ 1,389 $ 1,884 $ 1,692 $ 1,782 $ 1,582 $ 1,552 $ 1,358
======= ======= ======= ======= ======= ======= ======= =======
</TABLE>
(1) Excluding certain investments held by operating banking segments.
(2) Interest and dividend income from these investments is included in the
operating segments.
Page 33
<PAGE>
CITIGROUP CONSOLIDATED STATEMENT OF INCOME citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
4Q 4Q Full Year Full Year
1997 1998 1997 1998
------- ------- ------- -------
Revenues
<S> <C> <C> <C> <C>
Loan interest, including fees $ 5,386 $ 5,690 $20,765 $22,543
Other interest and dividends 5,704 5,973 21,336 23,696
Insurance premiums 2,325 2,692 8,995 9,850
Commissions and fees 2,898 2,822 10,936 11,589
Principal transactions 498 553 4,231 1,780
Asset management and administration fees 479 678 1,715 2,292
Realized gains from sales of investments 468 146 995 840
Other income 1,005 885 3,333 3,841
------- ------- ------- -------
Total revenues 18,763 19,439 72,306 76,431
Interest expense 6,624 6,685 24,524 27,495
------- ------- ------- -------
Total revenues, net of interest expense 12,139 12,754 47,782 48,936
------- ------- ------- -------
Provisions for Benefits, Claims and Credit Losses
Policyholder benefits and claims 2,005 2,225 7,714 8,365
Provision for credit losses 557 674 2,197 2,751
------- ------- ------- -------
Total provisions for benefits, claims and credit losses 2,562 2,899 9,911 11,116
------- ------- ------- -------
Operating Expenses
Non-insurance compensations and benefits 3,250 3,597 12,942 13,336
Insurance underwriting, acquisition and operating 812 895 3,236 3,274
Restructuring charges and merger-related costs 838 1,119 1,718 795
Other operating 2,467 3,182 9,225 11,146
------- ------- ------- -------
Total operating expenses 7,367 8,793 27,121 28,551
------- ------- ------- -------
Income before Income Taxes and Minority Interest 2,210 1,062 10,750 9,269
Provision for Income Taxes 713 320 3,833 3,234
Minority Interest, Net of Income Taxes 59 65 212 228
------- ------- ------- -------
Net Income $ 1,438 $ 677 $ 6,705 $ 5,807
======= ======= ======= =======
</TABLE>
Page 34
<PAGE>
CITIGROUP EARNINGS ANALYSIS - MARGIN BASIS citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
4Q 4Q Full Year Full Year
1997 1998 1997 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Total Revenues $ 12,139 $ 12,754 $ 47,782 $ 48,936
Effect of Credit Card Securitization Activities 434 568 1,713 2,187
Net Cost to Carry 4 (6) (5) 8
-------- -------- -------- --------
Adjusted Revenues 12,577 13,316 49,490 51,131
Total Operating Expenses 7,367 8,793 27,121 28,551
Net OREO Benefits 9 29 72 56
Restructuring Charges and Merger-Related Costs 838 1,119 1,718 795
-------- -------- -------- --------
Adjusted Operating Expenses 6,538 7,703 25,475 27,812
Operating Margin 6,039 5,613 24,015 23,319
Provisions for Benefits, Claims and Credit Losses 2,562 2,899 9,911 11,116
Effect of Credit Card Securitization Activities 434 568 1,713 2,187
Net Cost to Carry and Net OREO Benefits (5) (35) (77) (48)
-------- -------- -------- --------
Adjusted Provisions for Benefits, Claims and Credit Losses 2,991 3,432 11,547 13,255
Restructuring Charges and Merger-Related Costs 838 1,119 1,718 795
-------- -------- -------- --------
Income Before Income Taxes and Minority Interest 2,210 1,062 10,750 9,269
Provision for Income Taxes 713 320 3,833 3,234
Minority Interest, Net of Income Taxes 59 65 212 228
-------- -------- -------- --------
Net Income $ 1,438 $ 677 $ 6,705 $ 5,807
======== ======== ======== ========
</TABLE>
Page 35
<PAGE>
CITIGROUP -- RESTRUCTURING CHARGES AND MERGER-RELATED COSTS citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
4Q 1998 Full Year 1998
--------------------- ----------------------
Pre-tax After-tax Pre-tax After-tax
------- --------- ------- ---------
<S> <C> <C> <C> <C>
Global Consumer $ 712 $ 450 $ 712 $ 450
Global Corporate 324 203 324 203
SSB Citi Asset Management Group 17 10 17 10
Corporate / Other 69 40 69 40
------- --------- ------- ---------
Total Citigroup Restructuring Charges 1,122 703 1,122 703
Merger-Related Costs 65 65 65 65
Restructuring Charges - reversals of prior period charges (68) (42) (392) (233)
------- --------- ------- ---------
Total Restructuring Charges and Merger-Related Costs $ 1,119 $ 726 $ 795 $ 535
======= ========= ======= =========
</TABLE>
Page 36
<PAGE>
CONSUMER LOAN DELINQUENCY AMOUNTS, NET CREDIT citigroup[LOGO]
LOSSES AND RATIOS
(In millions of dollars, except loan amounts in billions)
<TABLE>
<CAPTION>
EOP Average
Loans 90 Days Or More Past Due (1) Loans Net Credit Losses (1)
--------- --------------------------------- --------- -------------------------------
4Q 1998 4Q 1998 3Q 1998 4Q 1997 4Q 1998 4Q 1998 3Q 1998 4Q 1997
--------- ------- ------- --------- --------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Citibanking North America $ 8.4 $ 87 $ 117 $ 142 $ 8.3 $ 32 $ 29 $ 35
Ratio 1.04% 1.28% 1.61% 1.55% 1.38% 1.67%
Mortgage Banking 25.6 625 623 715 24.6 17 17 24
Ratio 2.44% 2.69% 3.13% 0.27% 0.29% 0.41%
U.S. Bankcards (2) 69.1 1,001 939 868 65.1 790 805 663
Ratio 1.45% 1.49% 1.77% 4.82% 5.15% 5.56%
Other Cards 2.3 46 43 37 2.4 18 17 15
Ratio 1.96% 1.77% 1.72% 2.96% 2.98% 2.68%
Consumer Finance Services 11.9 172 162 133 11.4 77 71 61
Ratio 1.44% 1.45% 1.36% 2.67% 2.61% 2.51%
Europe, Middle East and Africa 17.1 937 938 905 16.9 73 66 64
Ratio 5.49% 5.57% 6.00% 1.71% 1.64% 1.67%
Asia Pacific 21.8 498 384 259 21.6 68 57 41
Ratio 2.28% 1.87% 1.34% 1.24% 1.12% 0.81%
Latin America 8.0 288 243 173 7.9 67 70 41
Ratio 3.60% 3.05% 2.34% 3.39% 3.48% 2.29%
Global Private Bank 17.0 193 195 110 16.8 11 1 (9)
Ratio 1.14% 1.19% 0.72% 0.25% 0.02% NM
e-CITI 0.4 2.0 1.0 1.0 0.3 1 -- 1
Ratio 0.35% 0.55% 0.60% 0.79% -- 1.48%
--------- ------- ------- --------- --------- ------- ------- -------
Total Managed 181.6 3,849 3,645 3,343 175.3 1,154 1,133 936
Ratio 2.12% 2.13% 2.23% 2.61% 2.68% 2.50%
Securitization Activities:
Securitized Credit Card
Receivables (44.3) (658) (614) (481) (41.5) (536) (542) (403)
Loans Held for Sale (5.0) (38) (38) (35) (4.9) (32) (34) (31)
--------- ------- ------- --------- --------- ------- ------- -------
(49.3) (696) (652) (516) (46.4) (568) (576) (434)
Total Loans $ 132.3 $ 3,153 $ 2,993 $ 2,827 $ 128.9 $ 586 $ 557 $ 502
========= ======= ======= ========= ========= ======= ======= =======
Ratio 2.38% 2.39% 2.36% 1.80% 1.80% 1.68%
</TABLE>
(1) The ratios of 90 days or more past due and net credit losses are calculated
based on end-of-period and average loans, respectively, both net of unearned
income.
(2) Includes U.S. Bankcards and Travelers Bank.
NM Not meaningful
Page 37
<PAGE>
CITIGROUP SUPPLEMENTAL DATA (In millions of dollars) citigroup[LOGO]
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q 3Q
1997 1997 1997 1997 1998 1998 1998
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
CASH BASIS AND RENEGOTIATED LOANS
Commercial Cash-Basis Loans
Collateral Dependent (at lower of cost or
collateral value) (1) $ 288 $ 274 $ 271 $ 258 $ 242 $ 193 $ 170
Other (2) 641 643 698 806 1,102 1,100 1,110
------ ------ ------ ------ ------ ------ ------
Total Cash-Basis Loans $ 929 $ 917 $ 969 $1,064 $1,344 $1,293 $1,280
====== ====== ====== ------ ====== ====== ======
Commercial Cash-Basis Loans
Emerging Markets (2) $ 399 $ 470 $ 520 $ 649 $ 953 $ 981 $ 982
Global Relationship Banking 514 434 436 401 378 300 286
Insurance Subsidiaries -- -- -- -- -- -- --
Investment Activities 16 13 13 14 13 12 12
------ ------ ------ ------ ------ ------ ------
Total Cash-Basis Loans $ 929 $ 917 $ 969 $1,064 $1,344 $1,293 $1,280
====== ====== ====== ------ ====== ====== ======
Commercial Renegotiated Loans $ 296 $ 295 $ 70 $ 59 $ 61 $ 45 $ 48
====== ====== ====== ------ ====== ====== ======
Consumer Loans on which Accrual of Interest
has been Suspended $2,225 $2,145 $2,024 $1,991 $2,003 $2,021 $2,097
====== ====== ====== ------ ====== ====== ======
OTHER REAL ESTATE OWNED (OREO) AND
ASSETS PENDING DISPOSITION (3)
Consumer OREO $ 416 $ 371 $ 325 $ 275 $ 258 $ 199 $ 260
------ ------ ------ ------ ------ ------ ------
Emerging Markets 24 22 23 21 21 24 26
Global Relationship Banking 569 460 456 440 329 324 319
Insurance Subsidiaries 763 810 490 237 189 191 211
------ ------ ------ ------ ------ ------ ------
Total Commercial OREO 1,356 1,292 969 698 539 539 556
------ ------ ------ ------ ------ ------ ------
Total OREO $1,772 $1,663 $1,294 $ 973 $ 797 $ 738 $ 816
====== ====== ====== ------ ====== ====== ======
Assets Pending Disposition (4) $ 174 $ 72 $ 88 $ 96 $ 103 $ 104 $ 103
====== ====== ====== ------ ====== ====== ======
CREDIT LOSS RESERVES
Aggregate Allowance for Credit Losses:
Global Consumer (5) $2,693 $2,716 $2,795 $2,808 $2,830 $3,200 $3,275
Global Corporate 3,424 3,429 3,429 3,429 3,429 3,429 3,429
------ ------ ------ ------ ------ ------ ------
Total aggregate allowance for
credit losses 6,117 6,145 6,224 6,237 6,259 6,629 6,704
Reserves for securitization activities 91 91 89 85 70 61 66
------ ------ ------ ------ ------ ------ ------
Total Credit Loss Reserves $6,208 $6,236 $6,313 $6,322 $6,329 $6,690 $6,770
====== ====== ====== ------ ====== ====== ======
Allowance As a Percent of Total Loans:
Global Consumer 2.33% 2.29% 2.34% 2.35% 2.41% 2.67% 2.62%
Global Corporate (6) 4.80% 4.57% 4.40% 4.21% 3.89% 3.80% 3.68%
Total (6) 3.26% 3.15% 3.14% 3.09% 3.03% 3.15% 3.06%
</TABLE>
4Q Full Year Full Year
1998 1997 1998
------ ------ ------
CASH BASIS AND RENEGOTIATED LOANS
Commercial Cash-Basis Loans
Collateral Dependent (at lower of cost or
collateral value) (1) $ 394 $ 258 $ 394
Other (2) 1,201 806 1,201
------ ------ ------
Total Cash-Basis Loans $1,595 $1,064 $1,595
------ ====== ======
Commercial Cash-Basis Loans
Emerging Markets (2) $1,062 $ 649 $1,062
Global Relationship Banking 268 401 268
Insurance Subsidiaries 252 -- 252
Investment Activities 13 14 13
------ ------ ------
Total Cash-Basis Loans $1,595 $1,064 $1,595
------ ====== ======
Commercial Renegotiated Loans $ 45 $ 59 $ 45
------ ====== ======
Consumer Loans on which Accrual of Interest
has been Suspended $2,273 $1,991 $2,273
------ ====== ======
OTHER REAL ESTATE OWNED (OREO) AND
ASSETS PENDING DISPOSITION (3)
Consumer OREO $ 254 $ 275 $ 254
------ ------ ------
Emerging Markets 27 21 27
Global Relationship Banking 235 440 235
Insurance Subsidiaries 234 237 234
------ ------ ------
Total Commercial OREO 496 698 496
------ ------ ------
Total OREO $ 750 $ 973 $ 750
------ ====== ======
Assets Pending Disposition (4) $ 100 $ 96 $ 100
------ ====== ======
CREDIT LOSS RESERVES
Aggregate Allowance for Credit Losses:
Global Consumer (5) $3,310 $2,808 $3,310
Global Corporate 3,407 3,429 3,407
------ ------ ------
Total aggregate allowance for
credit losses 6,717 6,237 6,717
Reserves for securitization activities 46 85 46
------ ------ ------
Total Credit Loss Reserves $6,763 $6,322 $6,763
------ ====== ======
Allowance As a Percent of Total Loans:
Global Consumer 2.50% 2.35% 2.50%
Global Corporate (6) 3.69% 4.21% 3.69%
Total (6) 2.98% 3.09% 2.98%
(1) A cash-basis loan is defined as collateral dependent when repayment is
expected to be provided solely by the underlying collateral and there are
no other available and reliable sources of repayment, in which case the
loans are written down to the lower of cost or collateral value.
(2) Includes foreign currency derivative contracts with a balance sheet credit
exposure of $14 million, $44 million, $44 million, $83 million, and $59
million at December 31, 1998, September 30, 1998, June 30, 1998, March 31,
1998 and December 31, 1997, respectively, for which the recognition of
revaluation gains has been suspended.
(3) Carried at lower of cost or collateral value.
(4) Represents consumer residential mortgage loans that have a high
probability of foreclosure.
(5) The 1998 second quarter reflects the addition of $320 million of credit
loss reserves related to the acquisition of the Universal Card portfolio.
(6) Excludes allowance portion attributable to standby letters of credit
and guarantees, and derivative and foreign exchange contracts.
Page 38
<PAGE>
CITICORP SUPPLEMENTAL DATA citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q 2Q
1997 1997 1997 1997 1998 1998
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
NET INTEREST REVENUE STATISTICS
(taxable equivalent basis)
Net Interest Revenue $ 2,819 $ 2,876 $ 2,888 $ 2,871 $ 2,856 $ 3,009
Effect of Credit Card Securitization Activity 630 578 565 596 640 908
------- ------- ------- ------- ------- -------
Total Adjusted $ 3,449 $ 3,454 $ 3,453 $ 3,467 $ 3,496 $ 3,917
======= ======= ======= ======= ======= =======
Average Interest Earning Assets (in billions of dollars) $ 242.2 $ 252.6 $ 255.7 $ 257.0 $ 265.2 $ 276.0
Effect of Credit Card Securitization Activity 25.1 24.7 24.8 26.3 27.4 36.8
------- ------- ------- ------- ------- -------
Total Adjusted $ 267.3 $ 277.3 $ 280.5 $ 283.3 $ 292.6 $ 312.8
======= ======= ======= ======= ======= =======
Net Interest Margin (%) 4.72% 4.57% 4.48% 4.43% 4.37% 4.37%
Effect of Credit Card Securitization Activity 0.51% 0.43% 0.40% 0.42% 0.48% 0.65%
------- ------- ------- ------- ------- -------
Total Adjusted 5.23% 5.00% 4.88% 4.85% 4.85% 5.02%
======= ======= ======= ======= ======= =======
TRADING RELATED REVENUES
By Business Sector:
Global Corporate:
Emerging Markets Banking $ 218 $ 186 $ 301 $ 101 $ 315 $ 288
Global Relationship Banking 319 239 263 165 339 328
------- ------- ------- ------- ------- -------
Total Global Corporate 537 425 564 266 654 616
Global Consumer and Other 52 86 96 81 74 114
------- ------- ------- ------- ------- -------
Total $ 589 $ 511 $ 660 $ 347 $ 728 $ 730
======= ======= ======= ======= ======= =======
By Trading Activity:
Foreign Exchange $ 237 $ 258 $ 342 $ 327 $ 386 $ 391
Derivative 207 129 170 (49) 236 218
Fixed Income 70 59 75 1 56 31
Other 75 65 73 68 50 90
------- ------- ------- ------- ------- -------
Total $ 589 $ 511 $ 660 $ 347 $ 728 $ 730
======= ======= ======= ======= ======= =======
By Income Statement Line:
Foreign Exchange $ 297 $ 311 $ 435 $ 443 $ 349 $ 465
Trading Account 198 97 134 (188) 236 98
Other 94 103 91 92 143 167
------- ------- ------- ------- ------- -------
Total $ 589 $ 511 $ 660 $ 347 $ 728 $ 730
======= ======= ======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
3Q 4Q Full Year Full Year
1998 1998 1997 1998
------- ------- ------- -------
<S> <C> <C> <C> <C>
NET INTEREST REVENUE STATISTICS
(taxable equivalent basis)
Net Interest Revenue $ 3,117 $ 3,280 $11,454 $12,262
Effect of Credit Card Securitization Activity 951 1,039 2,369 3,538
------- ------- ------- -------
Total Adjusted $ 4,068 $ 4,319 $13,823 $15,800
======= ------- ======= =======
Average Interest Earning Assets (in billions of dollars) $ 278.7 $ 287.5 $ 251.9 $ 276.9
Effect of Credit Card Securitization Activity 39.9 41.2 25.2 36.3
------- ------- ------- -------
Total Adjusted $ 318.6 $ 328.7 $ 277.1 $ 313.2
======= ------- ======= =======
Net Interest Margin (%) 4.44% 4.53% 4.55% 4.43%
Effect of Credit Card Securitization Activity 0.62% 0.68% 0.44% 0.61%
------- ------- ------- -------
Total Adjusted 5.06% 5.21% 4.99% 5.04%
======= ======= ======= =======
TRADING RELATED REVENUES
By Business Sector:
Global Corporate:
Emerging Markets Banking $ 185 $ 263 $ 806 $ 1,051
Global Relationship Banking 112 220 986 999
------- ------- ------- -------
Total Global Corporate 297 483 1,792 2,050
Global Consumer and Other 95 101 315 384
------- ------- ------- -------
Total $ 392 $ 584 $ 2,107 $ 2,434
======= ======= ======= =======
By Trading Activity:
Foreign Exchange $ 388 $ 346 $ 1,164 $ 1,511
Derivative 111 251 457 816
Fixed Income (36) (15) 205 36
Other (71) 2 281 71
------- ------- ------- -------
Total $ 392 $ 584 $ 2,107 $ 2,434
======= ======= ======= =======
By Income Statement Line:
Foreign Exchange $ 474 $ 339 $ 1,486 $ 1,627
Trading Account (159) 90 241 265
Other 77 155 380 542
------- ------- ------- -------
Total $ 392 $ 584 $ 2,107 $ 2,434
======= ======= ======= =======
</TABLE>
Page 39
<PAGE>
TRAVELERS PROPERTY CASUALTY CORP. SUPPLEMENTAL DATA citigroup[LOGO]
(In millions of dollars)
<TABLE>
<CAPTION>
1Q 2Q 3Q 4Q 1Q
1997 1997 1997 1997 1998
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
GAAP Consolidated Statement of Operations
Revenues:
Premiums $ 1,799.9 $ 1,811.8 $ 1,806.0 $ 1,807.8 $ 1,898.2
Net investment income 500.2 506.4 528.0 516.2 508.3
Fee income 97.0 91.4 90.4 85.9 82.0
Realized investment gains (losses) 8.1 (6.8) 56.7 111.0 66.4
Other revenues 26.1 28.1 25.6 21.1 39.3
--------- --------- --------- --------- ---------
Total revenues 2,431.3 2,430.9 2,506.7 2,542.0 2,594.2
--------- --------- --------- --------- ---------
Claims and expenses:
Claims and claim adjustment expenses* 1,366.0 1,365.5 1,344.8 1,357.0 1,427.9
Policyholder dividends 7.1 9.6 17.6 15.9 13.0
Amortization of deferred acquisition costs 283.1 279.2 286.0 278.7 285.9
Interest expense 39.9 40.0 40.9 42.0 41.0
General and administrative expenses 345.1 344.0 350.5 345.6 340.5
--------- --------- --------- --------- ---------
Total expenses 2,041.2 2,083.3 2,039.8 2,039.2 2,108.3
--------- --------- --------- --------- ---------
Income before federal income taxes 390.1 392.6 466.9 502.8 485.9
Federal income taxes 117.0 116.6 140.1 142.3 138.8
--------- --------- --------- --------- ---------
Net income** $ 273.1 $ 276.0 $ 326.8 $ 360.5 $ 347.1
========= ========= ========= ========= =========
* Includes pre-tax:
Catastrophe losses, net of reinsurance $ 7.5 $ 7.3 $ -- $ 8.2 $ 13.2
Asbestos and environmental losses $ 30.0 $ 29.0 $ 40.0 $ 35.4 $ 31.0
** Includes, net of taxes:
Net investment income $ 347.3 $ 354.2 $ 369.5 $ 370.1 $ 364.8
Realized investment gains (losses) $ 5.2 $ (4.4) $ 36.8 $ 72.6 $ 43.2
Statutory underwriting
Net written premiums (1) $ 2,113.3 $ 1,885.6 $ 1,951.2 $ 1,881.5 $ 2,017.8
Net earned premiums $ 1,800.0 $ 1,811.5 $ 1,805.4 $ 1,808.8 $ 1,897.0
Losses and loss adjustment expenses 1,325.8 1,316.3 1,295.9 1,292.9 1,383.2
Other underwriting expenses 591.2 571.2 600.9 574.9 572.0
--------- --------- --------- --------- ---------
Statutory underwriting loss (117.0) (76.0) (91.4) (59.0) (58.2)
Policyholder dividends 3.0 18.8 15.2 50.1 13.0
--------- --------- --------- --------- ---------
Statutory underwriting loss after policyholder
dividends $ (120.0) $ (94.8) $ (106.6) $ (109.1) $ (71.2)
========= ========= ========= ========= =========
Reserves for losses and loss adjustment expenses $21,728.3 $21,675.1 $21,559.4 $21,396.2 $21,323.2
Decrease in reserves $ (83.6) $ (53.2) $ (115.7) $ (163.2) $ (73.0)
Statutory surplus $ 5,552.0 $ 5,773.6 $ 6,004.8 $ 6,188.2 $ 6,409.1
Net written premiums/surplus (2) 1.35:1 1.33:1 1.29:1 1.27:1 1.21:1
Statutory combined ratio: (1), (3)
Loss and loss adjustment expense ratio 73.7% 72.7% 71.8% 71.5% 72.9%
Other underwriting expense ratio 28.0% 30.3% 30.8% 30.6% 28.3%
--------- --------- --------- --------- ---------
Combined ratio 101.7% 103.0% 102.6% 102.1% 101.2%
========= ========= ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
2Q 3Q 4Q Full Year Full Year
1998 1998 1998 1997 1998
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
GAAP Consolidated Statement of Operations
Revenues:
Premiums $ 1,902.8 $ 1,974.9 $ 2,020.2 $ 7,225.5 $ 7,796.1
Net investment income 519.3 501.4 571.0 2,050.8 2,100.0
Fee income 76.9 74.2 72.7 364.7 305.8
Realized investment gains (losses) 9.6 32.7 34.8 169.0 143.5
Other revenues 23.6 17.2 25.6 100.9 105.7
--------- --------- --------- --------- ---------
Total revenues 2,532.2 2,600.4 2,724.3 9,910.9 10,451.1
--------- --------- --------- --------- ---------
Claims and expenses:
Claims and claim adjustment expenses* 1,430.8 1,517.7 1,529.4 5,433.3 5,905.8
Policyholder dividends 13.2 13.3 1.9 50.2 41.4
Amortization of deferred acquisition costs 303.7 304.7 302.2 1,127.0 1,196.5
Interest expense 40.4 39.9 39.9 162.8 161.2
General and administrative expenses 318.0 300.1 350.3 1,385.2 1,308.9
--------- --------- --------- --------- ---------
Total expenses 2,106.1 2,175.7 2,223.7 8,158.5 8,613.8
--------- --------- --------- --------- ---------
Income before federal income taxes 426.1 424.7 500.6 1,752.4 1,837.3
Federal income taxes 113.6 109.4 132.7 516.0 494.5
--------- --------- --------- --------- ---------
Net income** $ 312.5 $ 315.3 $ 367.9 $ 1,236.4 $ 1,342.8
========= ========= ========= ========= =========
* Includes pre-tax:
Catastrophe losses, net of reinsurance $ 36.2 $ 56.5 $ -- $ 23.0 $ 105.9
Asbestos and environmental losses $ 30.0 $ 28.0 $ 27.0 $ 134.4 $ 116.0
** Includes, net of taxes:
Net investment income $ 375.5 $ 366.1 $ 412.2 $ 1,441.1 $ 1,518.6
Realized investment gains (losses) $ 6.2 $ 21.3 $ 22.5 $ 110.2 $ 93.2
Statutory underwriting
Net written premiums (1) $ 1,994.7 $ 2,076.9 $ 2,014.2 $ 7,831.6 $ 8,103.6
Net earned premiums $ 1,896.1 $ 1,974.9 $ 2,020.2 $ 7,225.7 $ 7,788.2
Losses and loss adjustment expenses 1,387.7 1,477.5 1,480.4 5,230.9 5,728.8
Other underwriting expenses 587.7 585.2 575.2 2,338.2 2,320.1
--------- --------- --------- --------- ---------
Statutory underwriting loss (79.3) (87.8) (35.4) (343.4) (260.7)
Policyholder dividends 13.2 13.3 1.9 87.1 41.4
--------- --------- --------- --------- ---------
Statutory underwriting loss after policyholder
dividends $ (92.5) $ (101.1) $ (37.3) $ (430.5) $ (302.1)
========= ========= ========= ========= =========
Reserves for losses and loss adjustment expenses $21,141.8 $20,958.4 $20,726.7 $21,396.2 $20,726.7
Decrease in reserves $ (181.4) $ (183.4) $ (231.7) $ (415.7) $ (669.5)
Statutory surplus $ 6,640.4 $ 6,754.3 $ 7,079.1 $ 6,188.2 $ 7,079.1
Net written premiums/surplus (2) 1.18:1 1.18:1 1.14:1 1.27:1 1.14:1
Statutory combined ratio: (1), (3)
Loss and loss adjustment expense ratio 73.2% 74.8% 73.3% 72.4% 73.6%
Other underwriting expense ratio 29.5% 28.2% 28.6% 29.9% 28.6%
--------- --------- --------- --------- ---------
Combined ratio 102.7% 103.0% 101.9% 102.3% 102.2%
========= ========= ========= ========= =========
</TABLE>
(1) First quarter 1997 net written premiums include an increase of $142.4
million due to a change to conform Aetna P&C's and Travelers P&C's methods
of recording net written premiums, and an increase of $68.7 million due to
an adjustment associated with a reinsurance transaction. Excluding these
transactions, the statutory loss and loss adjustment expense ratio, other
underwriting expense ratio and combined ratio for the 1997 first quarter
were 73.7%, 28.8% and 102.5%, respectively, and for the 1997 full year were
72.4%, 30.1% and 102.5% respectively.
(2) Based on 12 month rolling net written premiums.
(3) Before policyholder dividends.
Page 40
<PAGE>
SIGNATURE
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 hereunto duly authorized.
Dated: January 25, 1999
Citigroup Inc.
By: /s/ Irwin Ettinger
-----------------------------
Irwin Ettinger
Chief Accounting Officer
