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Moody’s Global
Banking
Company Profile March 2009
Citibank Korea Inc Seoul, Korea Company Overview
Analyst Contacts: Singapore
65.6398.8311
Beatrice Woo Vice President/Senior Credit Officer Seung Jun Lee Associate Analyst
Hong Kong
852.2916.1121
Young Il Choi Vice President/Senior Analyst Jerry Chien Managing Director
Citibank Korea Inc (CKI) is the seventh largest bank in Korea with a 5% domestic commercial banking market share based on assets. As of September 30, 2008, it reported total bank account assets of KRW61.3 trillion (US$52.2 billion). CKI is a commercial bank providing transactional banking, treasury and risk management instruments, loan syndication, capital markets expertise, credit cards, and wealth management services to individuals, SMEs, large corporations, multinational companies, and financial institutions through a network of 227 branches in Korea. The bank is a direct subsidiary of Citibank Overseas Investment Corporation, a wholly owned subsidiary of Citigroup Inc. (Citigroup), a US-based diversified global financial services holding company. As of January 31, 2009, Citigroup held a 99.96% stake in CKI through Citibank Overseas Investment Corporation (80.58%) and Citibank N.A. (19.38%). CKI was originally formed in 1983 as a joint venture between Bank of America and several major Korean corporations. Note: Currency converted using exchange rate of KRW-US$ 0.00085 as of Sep 30, 2008 Source: Company Reports (audited report Dec 07, balance sheet Sep 08), Company data, Moody’s research, www.oanda.com
This report, exclusively provided to you by Moody’s, presents a convenient summary of as reported, publicly available information. The information is not adjusted for Moody’s analytic purposes. For Moody’s Ratings, Opinion and Analytics on this company, please [Click here]. To access the latest Moody's Credit Opinion on this company, please [Click here].
Company Profile
Moody’s Global Banking
Citibank Korea Inc
December 2007 Financial Highlights (as Reported) Note: The financials presented below are those reported by the entity and are not adjusted for Moody’s analytic purposes. For Moody’s generated ratios on Citibank Korea Inc, please see .
Citibank Korea Inc KRW billion KRW/US$, Period end
31-Dec-07 31-Dec-06 31-Dec-05
% change % change 07/06 06/05
0.00107
0.00109
0.00101
46,965
48,177
45,345
(2.52)
6.25
3,651
3,353
3,080
8.89
8.85
-
-
-
-
-
Total Equity
4,155
4,044
4,017
2.76
0.68
Tier 1 Ratio (%)
11.26
11.43
11.68
(17) bps
(25) bps
468
324
461
44.44
(29.69)
-
-
-
-
-
Total Assets Total Shareholders’ Equity Shareholders’ Equity excluding Minority Interest
Net Income Net Income Attributable to Equity Holders
Note: 1) Bank account figures used for all financials, i.e. excluding trust account 2) “Shareholders’ Equity excluding Minority Interest” and “Net Income Attributable to Equity Holders” are not applicable for the bank 3) Financial Supervisory Services reports “Regulatory Capital” as “Total Equity” Source: Company Reports (audited report Dec 07 and Dec 06), Company data, Financial Supervisory Services www.oanda.com
Latest Quarterly Results KRW billion KRW/US$, Period end Total Assets Total Shareholders’ Equity Shareholders’ Equity excluding Minority Interest Total Equity Tier 1 Ratio (%) Net Income Net Income Attributable to Equity Holders
30-Sep-08
30-Sep-07
% change 08/07
0.00085
0.00110
61,345
52,679
16.45
3,912
3,579
9.31
-
-
-
4,144
4,155
(0.27)
8.43
11.56
(313) bps
94
118
(20.34)
-
-
-
Note: 1) Bank account figures used for all financials, i.e. excluding trust account 2) ‘Shareholders’ Equity excluding Minority Interest’ and ‘Net Income Attributable to Equity Holders’ are not applicable for the bank 3) Financial Supervisory Services reports “Regulatory Capital” as “Total Equity” Source: Company Reports (balance sheet Sep 08 and Sep 07), Company data, Financial Supervisory Services, www.oanda.com
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc
Business Activities CKI is a commercial bank providing transactional banking, treasury and risk management instruments, loan syndication, capital markets expertise, credit cards, and wealth management services to individuals, SMEs, large corporations, multinational companies, and financial institutions. The bank’s business activities are organized into the following business segments: Consumer Banking, Corporate Banking, Credit Cards, and Trust. For the year ended December 31, 2007, Corporate Banking was the largest contributor to the bank’s operating revenue (76.4%). Consumer Banking: This segment provides a range of consumer banking products and services including loans, deposits, insurance, investment products, and foreign exchange services. Its lending portfolio comprises mortgage and unsecured personal loans. As of December 31, 2007, the segment reported total assets of KRW20.7 trillion (US$22.1 billion) and contributed 17.4% of the bank’s operating revenue in FY 2007. Corporate Banking: This segment offers corporate banking services including treasury management, cash management, trade services, loans, and structured finance. Treasury management services involve foreign exchange trading, cross-border fund transfer services, foreign currency deposits, and derivatives transactions. Trade finance includes bills discounting, trade bill finance, foreign currency loans, factoring and forfaiting, and accounts receivable finance. In addition, the bank provides securities services to institutional investors for equity, fixed income, and derivatives investments in the Korean market, and to issuers for overseas securities management. CKI’s structured finance services comprise asset-backed finance, loan syndication, export finance, infrastructure & energy finance, and asset finance. As of December 31, 2007, the segment reported total assets of KRW16.2 trillion (US$17.3 billion) and contributed 76.4% of the bank’s operating revenue in FY 2007. Credit Cards: This segment comprises a wide range of credit cards and ancillary services provided by the bank. As of December 31, 2007, the segment reported total assets of KRW2.8 trillion (US$3.0 billion) and contributed 6.0% of the bank’s operating revenue in FY 2007. Trust: This segment offers a portfolio of trust services to Korean citizens including escrow services; agency, fiduciary and depository services; real estate trusts, monetary receivables trusts, securities trusts and money trusts. As of December 31, 2007, the segment reported total assets of KRW424.5 billion (US$454.3 million) and contributed 0.2% of the bank’s operating revenue in FY 2007. Note: Currency converted using exchange rate of KRW-US$ 0.00107 as of Dec 31, 2007 Source: Company Report (audited report Dec 07), Company data, www.oanda.com
Business Segment (% of Operating Revenue, as of December 2007)
Credit Cards Trust 0.2% 6.0% Consumer Banking 17.4%
Corporate Banking 76.4%
Source: Company Report (audited report Dec 07, Pg 80)
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc Operating Revenue per Business Segment (in KRW billion) 7000
6,571 5,717
6000
5000 4000
3000 2000 1,243
1,493
1000
487
519 14
16
0
Consumer Banking
Corporate Banking 2006
Credit Cards
Trust
2007
Source: Company Report (audited report Dec 07, Pg 80 & 81)
Distribution Capacity and Market Share CKI operates mainly in Korea through a network of 227 branches, including ten business offices. As of December 31, 2007, CKI operated through a network of 228 branches in Korea. In addition, the bank distributes its products and services through several alternative delivery channels including mobile, internet and phone banking as well as an ATM network. It offers bancassurance products to Korean citizens in partnership with AIG, Hungkuk Life, Kyobo Life, MetLife, PCA Life, and Samsung Life. The acquisition of the bank in 2004 by Citigroup Inc. (Citigroup), a US-based diversified global financial services holding company, enabled CKI to distribute its products and services and maintain and develop its business through Citigroup’s global network. Citigroup operates in 100 countries in six regions. CKI is the seventh largest bank in Korea with a 5% domestic commercial banking market share based on assets. As of September 2008, the bank’s comparative market share among all the banks in Korea in terms of bank account figures for assets, loans, and deposits was as follows:
Market Share of Citibank Korea Inc (CKI) (% Share) CKI
Sep-08
Sep-07
Sep-06
Assets
3.6
2.1
4.1
Loans
2.7
5.5
3.4
Deposits
2.9
3.4
3.7
Source: Company Reports (balance sheet Sep 08 and Sep 07), Financial Supervisory Services Source: Company Report (annual report Dec 07), Company data, Moody’s research
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc
Ownership and Structure CKI is a direct subsidiary of Citibank Overseas Investment Corporation, which is a wholly owned subsidiary of Citigroup. As of January 31, 2009, CKI had 303,664,384 shares outstanding of which 99.96% was held by Citigroup through Citibank Overseas Investment Corporation (80.58%) and Citibank N.A. (19.38%). Since 1987, Citigroup shares have mainly traded on the New York Stock Exchange (NYSE: C). In 1989, CKI was listed on the Korean Securities Exchange. It was, however, delisted in 2004 due to its failure to meet stock distribution requirements following its acquisition by Citigroup in that year.
Ownership Structure As of January 31, 2009, the shareholding structure of the bank was as follows:
Citibank Korea Inc Shareholders Citibank Overseas Investment Corporation
Shares
% Held
244,691,784
80.580
Citibank N.A.
58,836,266
19.375
Citi Sub-total
303,528,050
99.955
136,334
0.045
303,664,384
100.00
Minority Shareholders Total
Subsidiaries The bank’s subsidiaries are as follows:
Citibank Korea Inc Major Operations
Foundation date
Shares Owned
% Held
August 1997
919,520
25.73
600,000
100.00
Subsidiary
Location
Hanmi Technology Investment
Seoul, Korea Start-up investment
Citi Credit Service Co. Ltd.
Seoul, Korea Collection/Credit Investigation March 2008
Source: Company Report (audited report Dec 07), Company data, New York stock Exchange, The Korea Times, Korea Herald
Company Management
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Company Directors Current Title
Age
Yung Ku Ha
CKI: Chief Executive Officer, Chairman and Executive Director
N/A
N/A
N/A
Yun Bin Imm
CKI: Senior Executive Vice President (Risk Management Group and COO Group) and Executive Director
N/A
N/A
N/A
John Botcheller
CKI: Executive Vice President (Finance Group)
N/A
N/A
N/A
Myung Ok Kim
CKI: Executive Vice President (Operation Division)
N/A
N/A
N/A
March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Tenure Committees
Company Profile
Moody’s Global Banking
Citibank Korea Inc Board of Directors
Affiliation
Age
Tenure Committees
Yung Ku Ha
CKI: Chairman, Chief Executive Officer and Executive Director
N/A
N/A
N/A
Sung Ho Lee
CKI: Executive Director
N/A
N/A
Standing Audit Committee member
Jin Hei Park
CKI: Executive Director and Senior Executive Vice President (Corporate Banking Group)
N/A
N/A
N/A
Shin Won Kang
CKI: Executive Director and Senior Executive Vice President (Consumer Banking Group)
N/A
N/A
N/A
Yun Bin Imm
CKI: Executive Director and Senior Executive Vice President (Risk Management Group and COO Group)
N/A
N/A
N/A
Executive Directors
Non-Executive Directors
6
Michael Schlein
CKI: Non-Executive Director; International Franchise Management Citigroup Inc.: President
N/A
N/A
N/A
Stephen Bird
CKI: Non-Executive Director; Asia Pacific Global Consumer Group: Chief Executive Officer
N/A
N/A
N/A
Mark Hart
CKI: Non-Executive Director; Citi Regional Franchise Controller for the Asia Pacific Region (including Japan)
N/A
N/A
N/A
Cheul Park
CKI: Non-Executive Director; Leading Investment & Securities Co. Ltd.: Chairman
N/A
N/A
N/A
Uni Choi
CKI: Non-Executive Director; Konkuk University Korea: Professor
N/A
N/A
N/A
Joon Park
CKI: Non-Executive Director; Konkuk University Korea: Professor
N/A
N/A
N/A
Seong Hwan Oh
CKI: Non-Executive Director; Konkuk University Korea: Professor
N/A
N/A
N/A
March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc Organization Chart BOD Standing Auditor
CEO
ARR Dept. Audit Dept.
Business Innovation Dept.
Corporate Banking Group • Global Corporate Banking Div. • GRB/SAM Dept. • Commercial Banking Div. • GTS Div.
Consumer Banking Group • WM Div. • Marketing Div. • GCG Branch Distribution Div. • Card Business Div. • Consumer Asset & CitiBusiness Div.
Private Banking Group • CPB Product Development Dept. • CPB Branch
Finance Group
COO Group
• Financial Controller Dept. • CMB BP&A Dept. • GCG Finance Dept.
• HR Div. • Legal Div. • Communication Dept. • Citi Realty Services Dept. • Citi Business Services Dept. • EPO/CSIS Dept. • Compliance Dept. • AML Dept.
Financial Markets Group • Treasury Dept. • FMG Corporate Sales & Structuring Dept. • Trading Dept.
Trust Business Div.
Operation Div.
• Trust Dept. • Trust Transaction & Operation Dept.
• Operation Support 1 Dept. • Operation Support 2 Dept. • SFS Ops. Dept. • CitiPhone Dept.
Risk Management Group • Corporate Coverage Risk Div. • Commercial Risk Div. • Consumer Risk Div. • Risk Planning & Mgmt. Div.
Technology Div. • Technology Infrastructure & Control Dept. • Technology Development Dept.
Source: Company data
Company History Citibank Korea Inc. (CKI) was formed in 1983 as KorAm Bank Inc. (KorAm), a joint venture between Bank of America and several major Korean corporations. In 1989, CKI was listed on the Korean Securities Exchange. In 1997, the bank established Hanmi Technology Investment Co. Ltd., a start-up investment company. During the 1997 economic crisis, the bank suffered from deteriorating asset quality leading to the government taking it over. In November 2000, a consortium comprising JP Morgan and The Carlyle Group became the largest shareholder. On expiry of a three-year lock-up period, the consortium sold its entire 36.55% stake to Citigroup in May 2004. At the same time, Citigroup, through its subsidiary Citibank Overseas Investment Corporation, acquired a further stake in CKI increasing its holding in the bank to 97.47%. Currently, Citigroup owns 99.95% of shares outstanding in CKI.
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc In November 2004, Citigroup merged its 15 Korean branches into the bank and renamed the enlarged entity Citibank Korea Inc. Following the acquisition of the bank by Citigroup, the shares of CKI were delisted from the Korean Securities Exchange due to its failure to meet stock distribution requirements following acquisition. In March 2008, the bank established Citi Credit Service Co. Ltd. to provide collection and credit investigation services. In October 2008, the South Korean government announced a package of foreign currency payment guarantees for domestic banks, worth US$100 billion. As a result, the government will guarantee for three years the payment of all foreign currency loans raised by Korean lenders until June 2009. CKI has so far opted not to take advantage of the government’s payment guarantee scheme. Source: Company data, Company Reports (audited report Dec 07, KorAm Bank annual report Dec 04), Business Week, The Korea Times, Korea Herald
Peer Group
Daegu Bank, Ltd.
Hana Bank
Industrial Bank of Korea
Jeonbuk Bank
Kookmin Bank
Korea Development Bank
Korea Exchange Bank
National Agricultural Cooperative Federation
Pusan Bank
Shinhan Bank
Standard Chartered First Bank Korea Limited
Suhyup Bank
Woori Bank
Related Websites and Information Sources For additional information, please see:
the company's website: www.citibank.co.kr
the regulator’s website: www.fss.or.kr
MOODY’S has provided links or references to third party World Wide Websites or URLs ("Links or References") solely for your convenience in locating related information and services. The websites reached through these Links or References have not necessarily been reviewed by MOODY’S, and are maintained by a third party over which MOODY’S exercises no control. Accordingly, MOODY’S expressly disclaims any responsibility or liability for the content, the accuracy of the information, and/or quality of products or services provided by or advertised on any third party web site accessed via a Link or Reference. Moreover, a Link or Reference does not imply an endorsement of any third party, any website, or the products or services provided by any third party.
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc
Moody’s Related Research Credit Opinion:
Citibank Korea Inc
Korea
Analysis:
Korea, October 2008 (111686)
Banking System Outlook:
Korea, November 2007 (105870)
Banking Statistical Supplement:
Korea, July 2008 (109750)
Country Statistics:
Korea, November 2008
To access any of these reports, click on the entry above. Note that these references are current as of the date of publication of this report and that more recent reports may be available. All research may not be available to all clients.
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
Company Profile
Moody’s Global Banking
Citibank Korea Inc
Report Number: 115117 Author
Editor
Production Specialist
Seung Jun Lee
Justin Neville
Nita Desai
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March 2009 Company Profile Moody’s Global Banking - Citibank Korea Inc
