Citibank is a major international bank, founded in 1812 as the City Bank of New York, later First National City Bank of New York. Citibank is now the consumer banking arm of financial services giant Citigroup, one of the largest companies in the world. As of March 2007, it is the largest bank in the United States by holdings.

Citibank has operations in more than 100 countries and territories around the world. More than half of its 1,400 offices are in the United States, mostly in the New York City, Chicago, Miami, and Washington, D.C. metropolitan areas, as well as in California.

In addition to the standard banking transactions, Citibank offers insurance, credit card and investment products. Their online services division is among the most successful in the field, claiming about 15 million users.

As a result of the global financial crisis and huge losses in the value of its subprime mortgage assets, Citibank was rescued by the U.S. government under plans agreed for Citigroup. On November 23, 2008, in addition to initial aid of $25 billion, a further $25 billion was invested in the corporation together with guarantees for risky assets amounting to $306 billion.

History

Early history

Founded in 1812 as the City Bank of New York by a group of New York merchants, the bank's first head was Samuel Osgood, who had been the United States Postmaster General. Subsequently, ownership and management of the bank was taken over by Moses Taylor, a protégé of John Jacob Astor and one of the giants of the business world in the 19th century. During Taylor's ascendancy, the bank functioned largely as a treasury and finance center for Taylor's own extensive business empire.

In 1863 the bank joined the U.S.'s new national banking system and became The National City Bank of New York. By 1868, it was considered one of the largest banks in the United States, and in 1897, it became the first major U.S. bank to establish a foreign department. In 1896, it was the first contributor to the Federal Reserve Bank of New York.

National City became the first U.S. national bank to open an overseas banking office when its branch in Buenos Aires, Argentina, was opened in 1914. Many of Citi's present international offices are older; offices in London, Shanghai, Calcutta and elsewhere were opened in 1901 and 1902 by the International Banking Corporation (IBC), a company chartered to conduct banking business outside the U.S., at that time an activity forbidden to U.S. national banks. In 1918, IBC became a wholly owned subsidiary and was subsequently merged into the bank. By 1919 the bank had become the first U.S. bank to have $ 1 billion in assets.

In 1910, National City bought a significant share of Haiti's National Bank (Banque de la Republique d'Haiti) which functioned as the country's treasury and had a monopoly on note issue. After the American invasion of Haiti, it bought all of the capital stock of the Banque de la Republique. The bank became the target of criticism for what were considered to be monopolistic and unfair banking practices. It initially did not pay the Haitian government interest on surplus money that it deposited in the treasury, which was loaned out by City Bank in New York. After 1922, it began paying interest, but only at a rate of 2% compared to the 3.5% that it paid to similar depositors. Economist and Senator Paul Douglas estimated that this amounted to $1 million in lost interest at a time when Haiti's government revenues were less than $7 million.