Citigroup Venturing Into Iraq Gets Approval for Baghdad Office

Citigroup Venturing Into Iraq Gets Approval for Baghdad Office




Citigroup Inc. © got Iraqi approval to open an office in Baghdad, as it seeks to become the first U.S. bank to enter a country where fewer than one in five people have an account.

Iraq’s central bank gave preliminary consent to set up the representative office, Citigroup, the third-largest U.S. lender, said in an e-mailed statement today. Former diplomat Dennis Flannery, who has run the bank’s Iraqi desk from Amman, Jordan, for two years, will manage the operation. Branches are also planned for Erbil and Basra, it said.

“Iraq is an important market, with an economy that has substantial potential over time,” said Jame Cowles, chief executive officer for Europe, the Middle East and Africa. “Having a presence in Iraq will position us to better attune our services to the banking needs of our clients as they grow and develop their businesses in the country.”

Banks in Iraq are set for growth in earnings and assets as a surge in lending in OPEC’s second-biggest producer outpaces the region. Iraq’s rising oil exports and a drop in the prime lending rate to 6 percent from 17 percent in 2008 are feeding the expansion. Standard Chartered Plc has said it will open branches this year in Baghdad and the city of Erbil, followed by a third office next year in the oil hub of Basra.

 

 

 

Ban Lifted
Foreign banks were barred from the country until after the U.S.-led invasion that ousted the regime of Saddam Hussein. Today, 15 international banks operate there, competing with seven state banks, 23 private lenders and nine banks operating under Islamic rules, according to the central bank’s website.

Total credit in the country amounts to 9 percent of gross domestic product compared with an average of 55 percent in the Middle East and North Africa, according to Singapore-based Sansar Capital Management LLC, which runs a fund with $30 million invested in Iraqi equities.

Iraq holds the world’s fifth-largest proven oil deposits and is budgeting $118 billion in spending this year, up 18 percent from 2012. The International Monetary Fund forecasts that the economy will grow 9 percent this year, the fastest pace after Libya among 18 countries in the region.

Flannery was the financial attache at the U.S. embassy in Baghdad for a year before joining New York-based Citigroup in March 2011. He has worked at the Inter-American Development Bank, the U.S. Treasury and the World Bank.

 


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Citi plans first office in Baghdad, joining Britain’s Standard Chartered in Iraq banking push
06/24/2013
 

Citi plans first office in Baghdad, joining Britain’s Standard Chartered in Iraq banking push

By Associated Press, Updated: Monday, June 24, 2:38 AM

BAGHDAD — Citigroup Inc. is set to become the first American bank to open an office of its own in Baghdad, highlighting financial firms’ growing interest in Iraq a decade after the U.S.-led 2003 invasion.

Executives say the representative office Citi has received preliminary approval for will help support its corporate customers in Iraq and act as a liaison for companies looking to do business there.


Group says attack that left 10 dead, including an American citizen, was retribution for a May drone strike.

British bank Standard Chartered is also making a push in Iraq with plans to open branches in three cities.

“Essentially what we are doing is following our clients,” said Mayank Malik, Citi’s chief executive for Jordan and Iraq, ahead of an official announcement Monday. “We see this as a giant waking up. ... The time to enter is now. It’s not when everything has been done.”

Iraq has struggled to attract interest from Western companies outside of the oil sector in the 10 years since U.S.-led forces toppled dictator Saddam Hussein. Security and political instability remain major concerns, and corruption within the top-heavy statist economy is deeply entrenched.

Even so, foreign banks see opportunities as Iraq’s economy opens up on the back of an oil boom.

The World Bank expects Iraq’s economy to grow by 9 percent this year, compared with just over 2 percent for the global economy as a whole. Last year Iraq became the second-largest oil producer in OPEC, and now churns out more than 3 million barrels of crude a day.

Iraq’s financial system is dominated by state-owned banks, though lenders from nearby countries including Iran and Lebanon have opened branches since the war. Abu Dhabi Islamic Bank, one of the largest banks in the oil-rich United Arab Emirates, opened its first outpost in Baghdad last year.

Iraq is slowly showing signs of economic development, with new hotels, restaurants and car dealerships popping up. But it remains a challenging place to do business.

More than 2,000 people have been killed in bombings and other violent attacks since the start of April in the worst outburst of violence in five years. And the country is politically volatile. Iraq’s long-serving central bank governor was abruptly removed from his post in October following a probe into alleged financial wrongdoing.

Citi’s Iraq country head, Dennis Flannery, who was previously the U.S. Treasury Department’s representative at the U.S. Embassy in Baghdad, described Iraq’s unpredictability and instability as “part of the landscape” of the country.

“The economic engine is still humming along. We haven’t seen any reason to alter our strategy,” he said.

At a cafe inside Baghdad’s heavily fortified Green Zone, Citi’s Malik and Flannery described the new office as the start of a broader relationship with Iraq that could lead to bank branches down the road. The office itself will start out small and will be located outside the confines of the Green Zone, a sprawling complex of government buildings and embassies sealed off from the rest of the city by blast walls and heavily armed soldiers backed by tanks.

“There’ll be next steps,” Flannery said. “It’s important to collect information, to learn better what the market is all about, to learn the good parts, the bad parts, everything. ... And that will enable us to take that next step to full-scale banking in a better informed way.”

Citi already counts as clients many of the large international oil companies that have been brought in to develop Iraq’s vast oil reserves, he said.

The bank is also advising Kuwaiti telecommunications provider Zain as it gets ready to list shares of its Iraqi operations on the Iraq Stock Exchange. Another Iraqi telecom, Asiacell, raised nearly $1.3 billion when it floated shares on the small stock exchange in February. It was one of the Middle East’s biggest stock offerings in years.

Britain’s Standard Chartered, meanwhile, is working on plans to open bank branches in Baghdad, the southern oil hub of Basra and the Kurdish regional capital Irbil. Its reasons are similar to Citi’s.

“We need to be on the ground to support our global network clients in industries such as power, oil, telecoms and construction,” spokesman Piers Townsend said.

Saleh Mahoud Salman, the director of administration at the Central Bank of Iraq, was unable to say when the companies’ operating licenses would be issued. He welcomed the banks’ interest in Iraq, saying they could help “develop the economy and push the banking sector forward.”

Even as Citi and Standard Chartered push into Iraq under their own brands, British banking giant HSBC is considering an exit of its 70 percent stake in Iraq’s Dar es Salaam Investment Bank as part of a wider review of its global operations.


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Maliki calls (Citibank) to post more active and effective in the Iraqi market
06/24/2013
 

Monday, June 24, 2013 14:32

Maliki calls (Citibank) to post more active and effective in the Iraqi market


Baghdad / Baghdadi news / .. Prime Minister Nuri al-Maliki, on Monday, to more active participation and effectiveness of the Company (Citibank) in the Iraqi market.

Maliki said in a statement posted on its official website on the sidelines of a meeting with the President of the company (Citibank) Dance Avelanery who announced opening of an office for the company in Baghdad, seen by / Baghdadi News / said that Iraq plans to double its production of oil, gas and do a comprehensive reform of the economy so as to enhance its and makes it more versatile, indicating that the increase in resources will impact on other sectors of the economy in agriculture, industry, tourism, and other services.

For his part, Avelanery that the company is determined to be a partner in the development of Iraq and assist the advancement of its economy, stressing that there are international companies, many interested in investing in Iraq and will have a supportive role, and pointed out that the opening of the company's branch in Baghdad would be a prelude to open a branch administers activities banking, too. Ended 21 Q

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As banks eye Iraq, Citi plans office in Baghdad 
 




By ADAM SCHRECK | Associated Press – 2 hrs 26 mins ago
BAGHDAD (AP) — Citigroup Inc. is set to become the first American bank to open an office of its own in Baghdad, highlighting financial firms' growing interest in Iraq a decade after the U.S.-led 2003 invasion.
Executives say the representative office Citi has received preliminary approval for will help support its corporate customers in Iraq and act as a liaison for companies looking to do business there.
British bank Standard Chartered is also making a push in Iraq with plans to open branches in three cities.
"Essentially what we are doing is following our clients," said Mayank Malik, Citi's chief executive for Jordan and Iraq, ahead of an official announcement Monday. "We see this as a giant waking up. ... The time to enter is now. It's not when everything has been done."
Iraq has struggled to attract interest from Western companies outside of the oil sector in the 10 years since U.S.-led forces toppled dictator Saddam Hussein. Security and political instability remain major concerns, and corruption within the top-heavy statist economy is deeply entrenched.
Even so, foreign banks see opportunities as Iraq's economy opens up on the back of an oil boom.
The World Bank expects Iraq's economy to grow by 9 percent this year, compared with just over 2 percent for the global economy as a whole. Last year Iraq became the second-largest oil producer in OPEC, and now churns out more than 3 million barrels of crude a day.
Iraq's financial system is dominated by state-owned banks, though lenders from nearby countries including Iran and Lebanon have opened branches since the war. Abu Dhabi Islamic Bank, one of the largest banks in the oil-rich United Arab Emirates, opened its first outpost in Baghdad last year.
Iraq is slowly showing signs of economic development, with new hotels, restaurants and car dealerships popping up. But it remains a challenging place to do business.
More than 2,000 people have been killed in bombings and other violent attacks since the start of April in the worst outburst of violence in five years. And the country is politically volatile. Iraq's long-serving central bank governor was abruptly removed from his post in October following a probe into alleged financial wrongdoing.
Citi's Iraq country head, Dennis Flannery, who was previously the U.S. Treasury Department's representative at the U.S. Embassy in Baghdad, described Iraq's unpredictability and instability as "part of the landscape" of the country.
"The economic engine is still humming along. We haven't seen any reason to alter our strategy," he said.
At a cafe inside Baghdad's heavily fortified Green Zone, Citi's Malik and Flannery described the new office as the start of a broader relationship with Iraq that could lead to bank branches down the road. The office itself will start out small and will be located outside the confines of the Green Zone, a sprawling complex of government buildings and embassies sealed off from the rest of the city by blast walls and heavily armed soldiers backed by tanks.
"There'll be next steps," Flannery said. "It's important to collect information, to learn better what the market is all about, to learn the good parts, the bad parts, everything. ... And that will enable us to take that next step to full-scale banking in a better informed way."
Citi already counts as clients many of the large international oil companies that have been brought in to develop Iraq's vast oil reserves, he said.
The bank is also advising Kuwaiti telecommunications provider Zain as it gets ready to list shares of its Iraqi operations on the Iraq Stock Exchange. Another Iraqi telecom, Asiacell, raised nearly $1.3 billion when it floated shares on the small stock exchange in February. It was one of the Middle East's biggest stock offerings in years.
Britain's Standard Chartered, meanwhile, is working on plans to open bank branches in Baghdad, the southern oil hub of Basra and the Kurdish regional capital Irbil. Its reasons are similar to Citi's.
"We need to be on the ground to support our global network clients in industries such as power, oil, telecoms and construction," spokesman Piers Townsend said.
Saleh Mahoud Salman, the director of administration at the Central Bank of Iraq, was unable to say when the companies' operating licenses would be issued. He welcomed the banks' interest in Iraq, saying they could help "develop the economy and push the banking sector forward."
Even as Citi and Standard Chartered push into Iraq under their own brands, British banking giant HSBC is considering an exit of its 70 percent stake in Iraq's Dar es Salaam Investment Bank as part of a wider review of its global operations.



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I don't know if they are open yet,but this just has to be a good sign.

Citigroup
From Wikipedia, the free encyclopedia
Jump to: navigation, search
Not to be confused with CIT Group, another large financial services company or CITIC Group, a Chinese financial company.
"Citi" redirects here. For the bus service in the British cities Cambridge, Peterborough, Preston and Gloucester, see Stagecoach Group.
Citigroup Inc.
Citi.svg
Type Public
Traded as NYSE: C
S&P 500 Component
Industry Banking, Financial services
Predecessor(s) Citicorp
Travelers Group
Founded June 16, 1812[1]
Headquarters 399 Park Avenue, Manhattan,
New York City, New York, U.S.
Area served Worldwide
Key people

Michael E. O'Neill (Chairman)
Michael Corbat (CEO)

Products Credit cards, consumer banking, corporate banking, investment banking, global wealth management, financial analysis, private equity
Revenue Decrease US$ 70.17 billion (2012)[2]
Operating income Decrease US$ 7.936 billion (2012)[2]
Net income Decrease US$ 7.541 billion (2012)[2]
Total assets Decrease US$ 1.865 trillion (2012)[2]
Total equity Increase US$ 189.05 billion (2012)[2]
Employees 259,000 (Dec 2012)[2]
Subsidiaries Citibank India, Banamex, CitiMortgage, Citibank, CitiBranded Cards, Citi Private Bank, Citi Securities & Banking, Morgan Stanley Smith Barney (35%), Nikko Citigroup, Railmark Holdings, Salomon BIG, Sedna Finance
Website Citigroup.com

Citigroup Inc. or Citi is an American multinational financial services corporation headquartered in Manhattan, New York City, New York, United States. Citigroup was formed from one of the world's largest mergers in history by combining the banking giant Citicorp and financial conglomerate Travelers Group in October 1998 (announced on April 7, 1998).[3][4][5] The year 2012 marked Citi's 200th anniversary. It is currently the third largest bank holding company in the United States by assets. Its largest shareholders include funds from the Middle East and Singapore.[6]

Citigroup has the world's largest financial services network, spanning 140 countries with approximately 16,000 offices worldwide. The company currently employs approximately 260,000 staff around the world, which is down from 267,150 in 2010, according to Forbes.[7][8] It also holds over 200 million customer accounts in more than 140 countries. It is one of the primary dealers in US Treasury securities.[9] According to Forbes, at its height Citigroup used to be the largest company and bank in the world by total assets with 357,000 employees until the global financial crisis of 2008.[10] Today it is ranked 20th in size under the Fortune 500 list. In comparison, JPMorgan Chase, which is ranked 16th on the Fortune 500, is now the largest bank in U.S. as of 2012.[11]

Citigroup suffered huge losses during the global financial crisis of 2008 and was rescued in November 2008 in a massive stimulus package by the U.S. government.[12] On February 27, 2009, Citigroup announced that the United States government would take a 36% equity stake in the company by converting US$25 billion in emergency aid into common shares with a US Treasury credit line of $45 billion to prevent the bankruptcy of the largest bank in the world at the time.[13] The government would also guarantee losses on more than $300 billion troubled assets and inject $20 billion immediately into the company. In exchange, the salary of the CEO is $1 per year and the highest salary of employees is restricted to $500,000 in cash and any amount above $500,000 must be paid with restricted stock that cannot be sold until the emergency government aid is repaid in full.[14] The US government also gains control of half the seats in the Board of Directors, and the senior management is subjected to removal by the US government if there is poor performance. By December 2009, the US government stake was reduced to 27% majority stake from a 36% majority stake after Citigroup sold $21 billion of common shares and equity in the largest single share sale in US history, surpassing Bank of America's $19 billion share sale one month prior. Eventually by December 2010, Citigroup repaid the emergency aid in full and the US government received an additional $12 billion profit in selling its shares.[15][16][17][18][19] US Government restrictions on pay and oversight of the senior management were removed after the US government sold its remaining 27% stake as of December 2010.

Despite huge losses during the global financial crisis, Citigroup built up an enormous cash reserve in the wake of the financial crisis with $420 billion in surplus liquid cash and government securities as of June 2012.[20] As of Q1 2012, Citi has tier 1 capital ratio of 12.4%, making one of the best-capitalized financial institutions in the world after billions of dollars in losses from the financial crisis.[21] This was a result of selling more than $500 billion of its special assets placed in Citi Holdings, which were guaranteed from losses by the US Treasury while under federal majority ownership.[22] Additionally, according to the Washington Post, a special IRS tax exception given to Citi to allow the US Treasury to sell its shares at a profit while it still owned Citigroup shares, which eventually netted $12 billion. According to Treasury spokeswoman Nayyera Haq, "This (IRS tax) rule was designed to stop corporate raiders from using loss corporations to evade taxes, and was never intended to address the unprecedented situation where the government owned shares in banks. And it was certainly not written to prevent the government from selling its shares for a profit."[23]

Citigroup is one of the Big Four banks in the United States, along with Bank of America, JP Morgan Chase and Wells Fargo.[24][25][26][27][28][29][30]

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