The Rise and Fall of Citigroup
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- เผยแพร่เมื่อ 7 ส.ค. 2024
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In this video we go over the rise and fall of Citigroup, the fourth largest bank in the US with $1.6 trillion in assets. They were hit hard by the 2008 financial crisis and have been plagued by their bloated international operations which have reduced their efficiency compared to other US banks. Now they are trying to rationalize their operations by divesting the majority of their non-US consumer banking divisions.
0:00 - 1:15 Intro
1:16 - 2:21 Policygenius sponsorship
2:23 - 3:49 Citi founding
3:50 - 5:59 Merger with Travelers Group
6:00 - 7:48 Real estate investments
7:49 - 9:37 2008 financial crisis
9:38 - 10:45 Bailout
10:46 - 13:00 Recovery
13:01 Divestitures
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Insurance is the same model as the lottery, except they keep the profits.
Awkwardly watching this… as I work… for citi
How do you like your job?
😂😂😂😂
Yeah you guys need to get your shit together
I’m at JP Morgan watching the show 👀👀👀😂
@@blackice214 I am TD bank
As a Citi customer in India for the past 19 years, I'll miss the ability to withdraw money free of fees at Citibank ATMs whenever I used to travel to SE Asia and Japan :/ Citi India has been sold to Axis Bank.
I am extremely sad too.
@@soumyajitbasulive Damn im facing equally sad circumstances. My country’s currency lost 50 percent of its value due to inflation. But i guess we all have our fair share of problems. Extremely sad 😢
I am from India and have both a CITI Bank savings account as well a Credit Card. They are leaving India and selling the entire business to a private player named Axis Bank. So, sad to me. We will miss Citi. We love Citi. Never forget.
They absolutely need a more risk-adverse management team, but it's hard to argue with a bank that's below book value, profitable, and a reasonable dividend compared to their sector.
It's hard to be that in banking since you must supply what the customers want.
Lol a bank can’t be risk averse. They just need a more transparent and better internal controls. Can’t let their glorified salesman go around making shitty deals that do not increase long term value
@@MrDMIDOV Please leave banking to those of us that know the first thing about banking
@@MrDMIDOV Yes. You just described a risk-adverse management team. ;)
13:01 - Also in Manila, Philippines. In August 2022, Union Bank of the Philippines (UnionBank) took over Citigroup's Philippine retail banking operations.
In 1998, Sandy Weil was viewed as a genius by the powers of Wall Street...time are a lot different now.
You omitted that the Travelers citi mashup was not exactly, technically, actually legal.
I was thinking about that.
That legal issue was the FIRST thing to come to my mind!!! Plus it was a little more than just trying to sell insurance to home owners. It violated the Glass Stegal ACT!!! To competing interests groups under one roof and people were surprised that this failed???
@@Visiontech That's cause they knew GS was going to be repealed, and Jamie Dimon year's later talked about how the problem was after the merged they never got rid of the ancillary businesses and instead became incredibly siloed which is still causing problems today
Sounds like the story in the movie "Margin Call", even the line about music playing.
The only difference instead of getting the actor Jeremy Irons... they got Elon Musk the con jobber of our century to tell them... "Music is still playing, when music is still playing we should hire some clown in a robot costume and keep dancing" and short order the company went bust.
Not a life insurance ad on WSM.... 😫 why god whyyy. At least it's better than masterworks?
I Trust Citigroup more to survive then PolicyGenius
I missed the OLD CITIBANK with it's logo. I used to work there in the CITICORP. Centre S.F. Financial District.
First, a 3% interest rate differential is now a low arb rate.
Second, they used CP to buy mortgages and then sold them as CDOs. Made more on that then a simple spread.
Yes, but factor in leverage to that arbitrage
Only made possible by triple A valuations given by S&P et al to the Cred Deriv piles of ordure that was the CDO/CMO market in 07/08
You missed a word there: "Made more Losses on that then a simple spread"
Yield book (fixed income analytics) started in Saloman and became a part of Citi. It has the prepayment model pretty much everyone uses in the US. London Stock Exchange acquired Yield Book in 2017 - with the acquisition of Refinitiv in 2020, they are trying to compete against Bloomberg for data and analytics. It would be interesting if you could make a video on the competition in the financial data/analytics space. Bloomberg, London Stoc Exchnage, Blackrock etc. lots of stuff to talk about
Michael Bloomberg used to work at Salomon Brothers as a partner when Yield book was created.
As a customer of Citibank for over 20 years, never realized how bad their situation is today. Thanks for this video.
It is not in a bad position.
You're VERY bold with staying with them after 2008 lol
It is not in a bad position. It is the 3rd biggest bank in the US and to 10 in the world. It is also profitable. Moreover, they have a new CEO rebuilding what they once were, #1.
I am here since 10K subscribers. Such a tremendous growth and always very informative videos.
I too like that vague feeling of pride, watching a channel grow after having discovered it right at its start. Having been here since pretty much the beginning of this platform the feeling of loss when a creator you liked stops uploading is just as intense.
Up 15% on Citi. 4% of my portofolio. Very cheap and nee CEO is doing amazing and last Q was a huge showcase. This is turnarround story with low risk
LOL!
avg cost $46 for me. i just buy more and hold. I'm young and got time to see this bank grow back to new peaks
What is this video even talking about? The Citi group is still existing as a company
Amazing video
They also have numerous fat fingers. They caused a flash crash a few months ago and they also accidentally paid off Revlon’s debt.
What a bunch of dunces. Absolute negligent oafs..
Totally believable since credit Suisse has its whole database in an access file..
They opened their first international branch in Santiago, Argentina in 1920.
Santiago del Estero is not even a big city nowadays, I doubt that in 1920 it was anything more than a small town. I think you mean Buenos Aires.
Call it what it was - a takeover. Reed was a genius and a gentleman. Weill was a salesman.
I know a guy who used to work for citi and has a lot of stock there because of it. He thinks he’s making a good investment decision because of the 3.78% dividend, but fails to realize that, even with DRIP, he’s getting outperformed in just about every category
He might have got it at a reduced price through an employee purchase plan
@@leswhynin913 when he was there, they gave it to him as bonuses (iirc), but he still buys more even though he doesn’t work there anymore
It's just classic value investing. Warren Buffet bought in big this year as well.
The company is already profitable and paying a nice dividend, and as they dump unprofitable assets their earnings increase and become enticing to institutional investors again.
Institutional investors can't justify the wait as it drags on the portfolio, but patient private investors can pick up shares cheap while they wait for the turnaround.
Not risk free certainly, but he's not wrong about the strategy.
@@JABurtin I certainly believe the company is a little undervalued, but the fact their stock has grown a solid 0% in 30 years is more than enough to tell me it’s not worthwhile. The thing I understand the least is why he believes a company that has flatlined in growth is a better investment than the S&P500 or even a high yield dividend ETF like the VYM
@@Viipxz Growth =/= market capitalization. If you feel otherwise then you should invest all your money into Tesla.
“Babe wake up, there is a new WSM video!”
I work for Citi and they’re selling divisions left and right. Exiting all foreign markets except NA and EU. Makes some sense since they’re the money makers but I don’t know why the exited Asia. Maybe a JPM type of move whose soul focus is US banking? Who knows but Citi is ok, if I go to Chase I’d be making way more than I am. I work in a branch.
Yeah I wonder why they exit Asia too. I mean considering how Europe is going on right now, Asia seems like a much better place for growth. There is a risk of China closing its economy, and its ok to sell its China division. But I dont understand why they are leaving South East Asia.
You should do a video on "The Last man standing - the Chronicle of James Dimon CEO J. P. Morgan Chase", former deputy ("Executioner") of Sandy Weil. He had a fall out with Sandys' daughter (as do nothing executive cus my dad is the Chairman and Boss and she gets paid millions of dollars in the Citibank Asset Mgm Division as President just showed up for work) and he (J.D. was the one engineered the entire CITIBANK deal) got fired. but that was the best thing for HIM. If he never gets fired, there be no J. P. Morgan Chase Bank. Sandy Weil had been "dethroned". Now, J.D. is the KING of WALL STREET and global banking empire.
Well said !
Solomon Brothers. The way dude pronounced that had me like, tf??
When u die with no assets ur debts do disappear.
Look up the Peter Principle and you will probably see a picture of Chuck Prince associated with it. Elevated to a level of total incompetence.
Jane is doing the right move, moving out of the Asian market. Especially, China. Should have stayed in India. Yes, I would move out of Korea.
I was suppose to get 2k as promotion, but due to technical error, it took 3 months to resolve the matter. I asked CTI what do you offer as comoensation. They told me CITI do bot offer such things. I will never put my money ti CITI. Just so bad.
Yeah that whole banamex thing is a great story. Highly suggest you do a deep dive
Just an FYI: Solomon is pronounced “Sālamun”.
Thousands of people once worked Citi's equipment finance and leasing division headquartered at 450 Mamaroneck Avenue in Harrison NY. That very large business never made any real money is now just a memory.
Did you guys catch the dude moonwalking in the background at 1:04?
lol
Sharp eyes !!
US could have had a healthy public bank, they prefered to sell it.
CITI's stock was trading one point at $0.75 during 2007 fin crisis and I should have bought it.
That's a great story but untrue. The cheapest Citigroup stock got in 2007 was $225. I bought in 2009 @ 9.40 but I'm no genius because I sold in 2008 @158 for a 44K loss. The 1000 shares I bought have increased but with dividends combined I'm still a bag holder plus lost growth on 2001 dollars for 2 decades. Not in my top 5 worst stock buys but definitely top 10. I don't even have Citi in my watch group anymore. Nothing they can say or anyone else says would make me a buyer again.
@@raymondcaylor6292He's off by a couple of years. In 2009 Citi's stock price fell below $1 for the first time ever. There are news articles about it.
It wasn't in 2007 but it was because of the financial market decline that began in 2007.
Part of the reason it looks like Citi's stock price never fell below $1 now is because they did a 10:1 reverse split in 2011.
Sh-i-t-t-y bank 🏦 used to be great. Now they just self destruct. Citi credit cards are their only quality products now. I do wish they brought back AA partnership, travel insurance, golf ⛳️ benefits, and the Citi Prestige credit card.
It's a poor consumer that blames his banker.
@@samsonsoturian6013 I strongly disagree. A bad bank is a bad bank. Wells Fargo proved that when they robbed their own customers checking accounts, and charged them overdraft fees too.
solo mon
June 19 2024 Citigroup stock up 26.4% ( $60.90 )over last year. It may not be this year but by this time next year the inevitable scandal will see the stock price at $42. Their income comes from fees and credit card profits.
needed to prevented at any cost as if
Goners❤
When a bank screws the people, the people screw the bank
Citibanamex sucks, from their slow app to the 2 hour line outside every bank, thank god they are selling their mexican branch.
The term borrow commercial paper doesn't make any sense. You sell commercial paper to borrow money. Companies sell commercial paper and banks sell Certificates of deposit.
Video: Citigroup had major scandals.
Ad: buy our insurance through AIG 🤣
I can assure you, most human do not *need* life insurance
Why are you better to default on your loan?
Mainly because people were buying properties with the hope of selling later not to live in them, if all value has been lost due to a crash, might as well just let the bank have it
Citi needs to accuire us bank to remain competitive or else break up and let the other banks acquire its pieces
And now they have exited India. Bad decision I think. Will miss them. Great service.
4:30 those co-CEO may have had drastically different philosophies, but looks like they could have the same mother
This is the company that picks the US Government Administration.
They never fall just restructure , and insurance is a ripoff👌
never recovered from 2008 huh
Yeah, sad implications for the buy the dip army and the dogshit stay at home stocks they bought.
Because of bad CEO and bad policy if you only think take clients money that short money
1:05 guy walking backward behind Jane Fraser
Commentary?
😅😅
Soooo ur sayin its time to buy
Ask Warren Buffet
I’m considering it
200 million credit card customers not 72 million
Is this an example of what really smart financial minds can do? Taxpayers pay.
The fall of Citigroup? It's still a giant right?
Yeah
Yes, but way smaller than what they were before. In my country, pre-2008, they were once the most used credit card (had one before). Now, they had sold their operations to a local bank.
I'm going to get over $5K from Citibank alone in bank account bonuses this year. Just for putting money into their accounts for a few months. If they have money to pay out this kind of cash bonus I'd say they're doing quite all right.
It's a fraction of what it once was. It used to be the planet's biggest bank before 2008.
@@Re3iRtH idk, this sounds like a ponzi scheme move to me.
All the smart people after the financial crisis and bailout. The people left did the hiring.
This is the company that picks the US Administration.
Citi India was founded in 1902. Before Indian independence. They were part of the 1992 stock market scam.
☂️Fall 😔
According to this channel, every company in this world has fallen.
Citibank Japan got in trouble for dealing with Yakuza.
its called $HITIGroup.
EvilCorp if there ever was one.
Successful big banks laundry bigger money
You brushed over there history; they have almost gone bankrupt, effectively doing so several times and having to be bailed out. You even skipped over the Latin American debt disaster of their own making in the early 80s.
their* history
We go bankrupt the old-fashioned way, we earn it.
Here
Second!
I worked at Citi for several years and they are slimy.
Never, ever bank with Citi.
Ever.
You have to learn how to pronounce names like Weill and Solomon.
Why? Does it trigger u?
Op's voice is so unclear.
The advert about life insurance is misleading. Life insurance is a scam for most people
Not really. The rates are dirt cheap if yer young and healthy.
How so? I'm curious to how life insurance is a scam considering I know some sellers that pour their life on selling the product.
@@triadwarfare I think he assumes everyone's charged the same
Its important if you have a young family because you need to cover future expenses if there is a loss of future income
It's scam till you die
The worst bank in business!
Them and Wells
Citibank are marketing foolish. For example, they sold off Travelers with the red umbrella symbol and yet kept a red umbrella arc over the Citi name!!! Duh!
They once almost bankrupted my parents, so screw them. I wish them the worst.
Happy to see citi fallen. This bank is a very bad company in the world.
I dont buy this "systematically important" line. In fact id argue if we let more banks die and ate the blow in 08, we would not be in the situation we are now.
I first came across Citi in Australia in the late 90s as a corporate treasurer. Even then they were called the Deathstar. In the UK and Europe for the last 20 years I've dealt with them. They blow hot and cold abd have destroyed their reputation. Just recently they wasted my time for 2 years at my oil and gas company. They try to buy into an industry but a year later they pull out. They need to be broken up.
yes. i used to work in the old 'CITIBANK' the logo of blue flower shine "during the merger" in 1988. It was exciting. I left for small bank after two yrs. CITIBANK had small business banking dept but nothing in between (filled in by Wellsfargo, which is your case) and then billion dollars companies. It service smb less than $10 mil rev and nothing in between and then $1 billion in revenue. Don't know why is that. So can't blamed you that you wasted your time with CITI bankers. It won't lend you a dime. Cus its not in the lending book. John S Reed do not lend in the "middle-market" which your co. is.
I am so glad to see this. F S*itibank
Citi is fine, don't worry
Citibank was the first bank created in Venezuela