Exhibit 99.01
- --------------------------------------------------------------------------------
CONSOLIDATED FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Consolidated Statement of Income CITICORP and Subsidiaries
- --------------------------------------------------------------------------------
Second Quarter Six Months
------------------------------------------
(In Millions of Dollars, Except Per Share Amounts) 1998 1997 1998 1997
- ------------------------------------------------------------------------------------------------------------------
Interest Revenue
Loans, including Fees ................................................. $ 5,096 $ 4,717 $ 9,939 $ 9,271
Deposits with Banks ................................................... 267 245 549 469
Federal Funds Sold and Securities Purchased Under Resale Agreements ... 187 203 429 415
Securities
U.S. Treasury and Federal Agencies ................................. 85 107 147 177
State and Municipal ................................................ 35 35 68 67
Other, including dividends (Principally in offices outside the U.S.) 526 455 1,003 872
Trading Account Assets ................................................ 325 272 580 515
Loans Held For Sale ................................................... 137 107 246 212
------------------------------------------
6,658 6,141 12,961 11,998
------------------------------------------
Interest Expense
Deposits .............................................................. 2,783 2,421 5,405 4,650
Trading Account Liabilities ........................................... 85 76 177 149
Purchased Funds and Other Borrowings .................................. 474 427 903 865
Long-Term Debt ........................................................ 321 354 642 667
------------------------------------------
3,663 3,278 7,127 6,331
------------------------------------------
Net Interest Revenue .................................................. 2,995 2,863 5,834 5,667
------------------------------------------
Provision for Credit Losses ........................................... 564 512 1,071 935
------------------------------------------
Net Interest Revenue after Provision for Credit Losses ................ 2,431 2,351 4,763 4,732
------------------------------------------
Fees, Commissions, and Other Revenue
Fees and Commissions .................................................. 1,553 1,441 2,994 2,793
Foreign Exchange ...................................................... 465 311 814 608
Trading Account ....................................................... 98 97 334 295
Securities Transactions ............................................... 300 124 541 232
Other Revenue ......................................................... 791 475 1,290 912
------------------------------------------
3,207 2,448 5,973 4,840
------------------------------------------
Operating Expense
Salaries .............................................................. 1,471 1,286 2,826 2,550
Employee Benefits ..................................................... 354 321 713 722
------------------------------------------
Total Employee Expense ........................................... 1,825 1,607 3,539 3,272
Net Premises and Equipment Expense .................................... 528 479 1,027 969
Other Expense ......................................................... 1,530 1,087 2,711 2,101
------------------------------------------
3,883 3,173 7,277 6,342
------------------------------------------
Income Before Taxes ................................................... 1,755 1,626 3,459 3,230
Income Taxes .......................................................... 658 602 1,297 1,211
------------------------------------------
Net Income ............................................................ $ 1,097 $ 1,024 $ 2,162 $ 2,019
- ------------------------------------------------------------------------==========================================
Income Applicable to Common Stock ..................................... $ 1,070 $ 990 $ 2,103 $ 1,947
------------------------------------------
Earnings Per Share
0 Basic ............................................................ $ 2.37 $ 2.16 $ 4.65 $ 4.23
Diluted .......................................................... $ 2.30 $ 2.10 $ 4.53 $ 4.11
- ------------------------------------------------------------------------==========================================
1
- --------------------------------------------------------------------------------
Consolidated Balance Sheet CITICORP and Subsidiaries
- --------------------------------------------------------------------------------
June 30, Dec. 31,
(In Millions of Dollars) 1998 1997
- -----------------------------------------------------------------------------------------------
Assets
Cash and Due from Banks ........................................... $ 9,463 $ 8,585
Deposits at Interest with Banks ................................... 14,013 13,049
Securities, at Fair Value
Available for Sale ............................................. 34,160 30,762
Venture Capital ................................................ 3,117 2,599
Trading Account Assets ............................................ 37,121 40,356
Loans Held for Sale ............................................... 4,737 3,515
Federal Funds Sold and Securities Purchased Under Resale Agreements 12,375 10,233
Loans, Net
Consumer ....................................................... 107,410 108,066
Commercial ..................................................... 84,856 75,947
---------------------------
Loans, Net of Unearned Income ..................................... 192,266 184,013
Allowance for Credit Losses .................................... (6,182) (5,816)
---------------------------
Total Loans, Net .................................................. 186,084 178,197
Customers' Acceptance Liability ................................... 1,643 1,726
Premises and Equipment, Net ....................................... 4,675 4,474
Interest and Fees Receivable ...................................... 3,275 3,288
Other Assets ...................................................... 20,088 14,113
---------------------------
Total ............................................................. $ 330,751 $ 310,897
- --------------------------------------------------------------------===========================
Liabilities
Non-Interest-Bearing Deposits in U.S. Offices ..................... $ 17,940 $ 16,901
Interest-Bearing Deposits in U.S. Offices ......................... 40,920 40,361
Non-Interest-Bearing Deposits in Offices Outside the U.S. ......... 10,394 9,627
Interest-Bearing Deposits in Offices Outside the U.S. ............. 146,728 132,232
---------------------------
Total Deposits ................................................. 215,982 199,121
Trading Account Liabilities ....................................... 29,121 30,986
Purchased Funds and Other Borrowings .............................. 21,802 21,231
Acceptances Outstanding ........................................... 1,774 1,826
Accrued Taxes and Other Expense ................................... 6,757 6,464
Other Liabilities ................................................. 13,641 10,288
Long-Term Debt .................................................... 19,957 19,785
Stockholders' Equity
Preferred Stock (Without par value) ............................... 1,275 1,903
Common Stock ($1.00 par value) .................................... 506 506
Issued Shares: 506,298,235 in each period
Surplus ........................................................... 6,512 6,501
Retained Earnings ................................................. 18,371 16,789
Accumulated Other Changes in Equity from Nonowner Sources (A) ..... (370) (91)
Common Stock in Treasury, at Cost ................................. (4,577) (4,412)
Shares: 54,366,159 and 52,355,947, respectively
---------------------------
Total Stockholders' Equity ........................................ 21,717 21,196
---------------------------
Total ............................................................. $ 330,751 $ 310,897
- --------------------------------------------------------------------===========================
(A) Amounts at June 30, 1998 and December 31, 1997 include the after-tax amounts
for net unrealized gains on securities available for sale of $308 million
and $535 million, respectively, and foreign currency translation of ($678)
million and ($626) million, respectively. See note (A) on page 39 for
additional information.
- --------------------------------------------------------------------------------
2
- --------------------------------------------------------------------------------
Consolidated Statement of Changes in CITICORP and Subsidiaries
Stockholders' Equity
- --------------------------------------------------------------------------------
Six Months
(In Millions of Dollars) 1998 1997
- -------------------------------------------------------------------------------------------
Balance at Beginning of Period .................................. $ 21,196 $ 20,722
Net Income ...................................................... 2,162 2,019
Change in Net Unrealized Gains on Securities Available for Sale.. (227) 276
Change in Foreign Currency Translation .......................... (52) (61)
-------------------------
Total Changes in Equity from Nonowner Sources (A) ............ 1,883 2,234
Redemption of Perpetual Preferred Stock
Second Series ................................................ (220) --
Third Series ................................................. (83) --
Series 14 .................................................... -- (175)
Series 16 .................................................... (325)
Cash Dividends Declared
Common ....................................................... (522) (484)
Preferred .................................................... (58) (72)
Repurchase of Common Shares (B) ................................. (483) (1,228)
Employee Benefit Plans and Other Activity (C) ................... 329 412
-------------------------
Balance at End of Period ........................................ $ 21,717 $ 21,409
- ------------------------------------------------------------------=========================
(A) During the 1998 first quarter, Citicorp adopted Statement of Financial
Accounting Standards No. 130, which addresses the manner in which total
changes in equity from nonowner sources are presented in the financial
statements, including unrealized gains and losses on securities available
for sale and foreign currency translation. The adoption had no effect on
reported earnings, assets, or capital.
(B) During the 1998 second quarter, no shares were repurchased as the stock
repurchase program had been suspended in connection with the announced
agreement to merge with Travelers Group.
(C) Primarily issuance of common stock (including treasury shares) under
employee benefit plans and related amortization and tax benefits.
- --------------------------------------------------------------------------------
3
- --------------------------------------------------------------------------------
Consolidated Statement of Cash Flows CITICORP and Subsidiaries
- --------------------------------------------------------------------------------
Six Months
---------------------------
(In Millions of Dollars) 1998 1997
- -------------------------------------------------------------------------------------------------------------------
Cash Flows from Operating Activities
Net Income ............................................................................ $ 2,162 $ 2,019
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
Provision for Credit Losses ........................................................... 1,071 935
Depreciation and Amortization of Premises and Equipment ............................... 384 377
Amortization of Goodwill and Acquisition Premium Costs ................................ 85 24
Provision for Deferred Taxes .......................................................... (175) (19)
Venture Capital Activity .............................................................. (518) (29)
Net Gain on Sale of Securities ........................................................ (541) (232)
Changes in Accruals and Other, Net .................................................... (550) 842
Net Increase in Loans Held for Sale ................................................... (1,222) (2,499)
Net Decrease (Increase) in Trading Account Assets ..................................... 3,235 (1,690)
Net (Decrease) Increase in Trading Account Liabilities ................................ (1,865) 1,457
---------------------------
Total Adjustments ..................................................................... (96) (834)
---------------------------
Net Cash Provided by Operating Activities ............................................. 2,066 1,185
---------------------------
Cash Flows from Investing Activities
Net Increase in Deposits at Interest with Banks ....................................... (964) (1,154)
Securities -- Available for Sale
Purchases ........................................................................ (30,152) (27,914)
Proceeds from Sales .............................................................. 10,702 10,646
Maturities ....................................................................... 16,025 9,209
Net Increase in Federal Funds Sold and Securities Purchased Under Resale Agreements ... (2,142) (2,518)
Net Increase in Loans ................................................................. (90,183) (58,822)
Proceeds from Sales of Loans .......................................................... 87,841 51,663
Business Acquisitions ................................................................. (3,655) --
Capital Expenditures on Premises and Equipment ........................................ (658) (596)
Proceeds from Sales of Premises and Equipment, Subsidiaries and Affiliates, and OREO .. 321 660
---------------------------
Net Cash Used in Investing Activities ................................................. (12,865) (18,826)
---------------------------
Cash Flows from Financing Activities
Net Increase in Deposits .............................................................. 16,861 13,735
Net Increase in Federal Funds Purchased and Securities Sold Under Repurchase Agreements 231 3,548
Commercial Paper and Funds Borrowed with Original Maturities of Less Than One Year
Proceeds from Issuance ........................................................... 312,539 386,497
Repayment ........................................................................ (316,627) (384,017)
Proceeds from Issuance of Long-Term Debt .............................................. 1,991 3,264
Repayment of Long-Term Debt ........................................................... (1,653) (2,816)
Redemption of Preferred Stock ......................................................... (628) (175)
Proceeds from Issuance of Common Stock ................................................ 192 251
Treasury Stock Repurchases ............................................................ (483) (1,228)
Dividends Paid ........................................................................ (584) (556)
---------------------------
Net Cash Provided by Financing Activities ............................................. 11,839 18,503
---------------------------
Effect of Exchange Rate Changes on Cash and Due from Banks ............................ (162) (129)
---------------------------
Net Increase in Cash and Due from Banks ............................................... 878 733
Cash and Due from Banks at Beginning of Period ........................................ 8,585 6,905
---------------------------
Cash and Due from Banks at End of Period .............................................. $ 9,463 $ 7,638
- ----------------------------------------------------------------------------------------===========================
Supplemental Disclosure
Cash Paid During the Period for:
Interest .............................................................................. $ 6,347 $ 5,542
Income Taxes .......................................................................... 1,051 1,123
Non-Cash Investing Activities
Transfer from Loans to OREO ........................................................... 121 185
- ----------------------------------------------------------------------------------------===========================
4
- --------------------------------------------------------------------------------
Calculation of Earnings Per Share
- --------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Second Quarter Six Months
-----------------------------------------
(In Millions, except Per Share Amounts) ...... 1998 1997 1998 1997
- ----------------------------------------------------------------------------------------
Net Income ................................... $1,097 $1,024 $2,162 $2,019
Dividends on Preferred Stock ................. (27) (34) (59) (72)
-----------------------------------------
Income Applicable to Common Stock ............ $1,070 $ 990 $2,103 $1,947
- -----------------------------------------------=========================================
Weighted-Average Common Shares Outstanding ... 451.8 458.5 452.0 460.0
Dilutive Effect of Employee Stock Plans (A) .. 12.6 12.8 11.8 13.5
-----------------------------------------
Adjusted for Dilutive Computation ............ 464.4 471.3 463.8 473.5
- -----------------------------------------------=========================================
Basic Earnings Per Share ..................... $ 2.37 $ 2.16 $ 4.65 $ 4.23
Dilutive Earnings Per Share .................. 2.30 2.10 4.53 4.11
- -----------------------------------------------=========================================
(A) Includes the dilutive effect of stock options and stock purchase agreements
computed using the treasury stock method and shares issuable under deferred
stock awards.
- --------------------------------------------------------------------------------
5