Exhibit 99.01
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CONSOLIDATED FINANCIAL STATEMENTS
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Consolidated Statement of Income CITICORP and Subsidiaries
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Third Quarter Nine Months
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(In Millions of Dollars, Except Per Share Amounts) 1998 1997 1998 1997
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Interest Revenue
Loans, including Fees..................................................... $5,330 $4,813 $15,269 $14,084
Deposits with Banks....................................................... 263 258 812 727
Federal Funds Sold and Securities Purchased Under Resale Agreements....... 174 223 603 638
Securities
U.S. Treasury and Federal Agencies..................................... 77 62 224 239
State and Municipal.................................................... 39 35 107 102
Other, including dividends (Principally in offices outside the U.S.)... 639 448 1,642 1,320
Trading Account Assets.................................................... 307 236 887 751
Loans Held For Sale....................................................... 147 120 393 332
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6,976 6,195 19,937 18,193
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Interest Expense
Deposits.................................................................. 2,980 2,438 8,385 7,088
Trading Account Liabilities............................................... 66 78 243 227
Purchased Funds and Other Borrowings...................................... 514 468 1,417 1,333
Long-Term Debt............................................................ 318 335 960 1,002
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3,878 3,319 11,005 9,650
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Net Interest Revenue...................................................... 3,098 2,876 8,932 8,543
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Provision for Credit Losses............................................... 736 486 1,807 1,421
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Net Interest Revenue after Provision for Credit Losses.................... 2,362 2,390 7,125 7,122
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Fees, Commissions, and Other Revenue
Fees and Commissions...................................................... 1,575 1,478 4,569 4,271
Foreign Exchange.......................................................... 474 435 1,288 1,043
Trading Account........................................................... (159) 134 175 429
Securities Transactions................................................... (56) 186 485 418
Other Revenue............................................................. 562 432 1,852 1,344
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2,396 2,665 8,369 7,505
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Operating Expense
Salaries.................................................................. 1,505 1,356 4,331 3,906
Employee Benefits......................................................... 325 317 1,038 1,039
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Total Employee Expense................................................. 1,830 1,673 5,369 4,945
Net Premises and Equipment Expense........................................ 550 496 1,577 1,465
Restructuring Charge...................................................... - 889 - 889
Other Expense............................................................. 1,530 1,179 4,241 3,280
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3,910 4,237 11,187 10,579
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Income Before Taxes....................................................... 848 818 4,307 4,048
Income Taxes.............................................................. 318 307 1,615 1,518
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Net Income................................................................ $ 530 $ 511 $ 2,692 $ 2,530
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Income Applicable to Common Stock......................................... $511 $477 $2,613 $2,424
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Earnings Per Share
Basic.................................................................. $1.13 $1.04 $5.80 $5.28
Diluted................................................................ $1.11 $1.01 $5.65 $5.13
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Consolidated Balance Sheet CITICORP and Subsidiaries
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Sept. 30, Dec. 31,
(In Millions of Dollars) 1998 1997
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Assets
Cash and Due from Banks.............................................................................. $ 9,107 $ 8,585
Deposits at Interest with Banks...................................................................... 14,085 13,049
Securities, at Fair Value
Available for Sale................................................................................ 35,552 30,762
Venture Capital................................................................................... 3,285 2,599
Trading Account Assets............................................................................... 40,018 40,356
Loans Held for Sale.................................................................................. 5,183 3,515
Federal Funds Sold and Securities Purchased Under Resale Agreements.................................. 13,412 10,233
Loans, Net
Consumer.......................................................................................... 112,103 108,066
Commercial........................................................................................ 87,706 75,947
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Loans, Net of Unearned Income........................................................................ 199,809 184,013
Allowance for Credit Losses....................................................................... (6,240) (5,816)
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Total Loans, Net..................................................................................... 193,569 178,197
Customers' Acceptance Liability...................................................................... 1,609 1,726
Premises and Equipment, Net.......................................................................... 5,019 4,474
Interest and Fees Receivable......................................................................... 3,549 3,288
Other Assets......................................................................................... 18,952 14,113
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Total................................................................................................ $343,340 $310,897
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Liabilities
Non-Interest-Bearing Deposits in U.S. Offices........................................................ $ 16,315 $ 16,901
Interest-Bearing Deposits in U.S. Offices............................................................ 42,318 40,361
Non-Interest-Bearing Deposits in Offices Outside the U.S............................................. 10,925 9,627
Interest-Bearing Deposits in Offices Outside the U.S................................................. 152,877 132,232
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Total Deposits.................................................................................... 222,435 199,121
Trading Account Liabilities.......................................................................... 30,692 30,986
Purchased Funds and Other Borrowings................................................................. 24,305 21,231
Acceptances Outstanding.............................................................................. 1,685 1,826
Accrued Taxes and Other Expense...................................................................... 7,284 6,464
Other Liabilities.................................................................................... 15,811 10,288
Long-Term Debt....................................................................................... 19,982 19,785
Stockholders' Equity
Preferred Stock (Without par value).................................................................. 863 1,903
Common Stock ($1.00 par value)....................................................................... 506 506
Issued Shares: 506,298,235 in each period
Surplus.............................................................................................. 6,525 6,501
Retained Earnings.................................................................................... 18,621 16,789
Accumulated Other Changes in Equity from Nonowner Sources (A)........................................ (871) (91)
Common Stock in Treasury, at Cost.................................................................... (4,498) (4,412)
Shares: 53,583,079 and 52,355,947, respectively
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Total Stockholders' Equity........................................................................... 21,146 21,196
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Total................................................................................................ $343,340 $310,897
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(A) Amounts at September 30, 1998 and December 31, 1997 include the after-tax
amounts for net unrealized gains (losses) on securities available for sale
of ($242) million and $535 million, respectively, and foreign currency
translation of ($629) million and ($626) million, respectively. See note
(A) on page 41 for additional information.
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Consolidated Statement of Changes in Stockholders' Equity CITICORP and Subsidiaries
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Nine Months
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(In Millions of Dollars) 1998 1997
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Balance at Beginning of Period....................................................................... $21,196 $20,722
Net Income........................................................................................... 2,692 2,530
Change in Net Unrealized Gains (Losses) on Securities Available for Sale............................. (777) 278
Change in Foreign Currency Translation............................................................... (3) (90)
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Total Changes in Equity from Nonowner Sources (A)................................................. 1,912 2,718
Redemption of Perpetual Preferred Stock
Second Series..................................................................................... (220) -
Third Series...................................................................................... (83) -
Series 8A......................................................................................... (62) -
Series 14......................................................................................... - (175)
Series 16......................................................................................... (325) -
Series 17......................................................................................... (350) -
Cash Dividends Declared
Common............................................................................................ (782) (725)
Preferred......................................................................................... (78) (107)
Repurchase of Common Shares (B)...................................................................... (483) (1,477)
Employee Benefit Plans and Other Activity (C)........................................................ 421 564
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Balance at End of Period............................................................................. $21,146 $21,520
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(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 and third quarters, no shares were repurchased as
the stock repurchase program was suspended, and subsequently terminated
immediately prior to consummation of the merger with Travelers.
(C) Primarily issuance of common stock (including treasury shares) under
employee benefit plans and related amortization and tax benefits.
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Consolidated Statement of Cash Flows CITICORP and Subsidiaries
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Nine Months
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(In Millions of Dollars) 1998 1997
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Cash Flows from Operating Activities
Net Income........................................................................................... $ 2,692 $ 2,530
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
Provision for Credit Losses.......................................................................... 1,807 1,421
Depreciation and Amortization of Premises and Equipment.............................................. 585 570
Amortization of Goodwill and Acquisition Premium Costs............................................... 161 30
Provision for Deferred Taxes......................................................................... (621) (386)
Restructuring Charge................................................................................. - 889
Venture Capital Activity............................................................................. (686) (224)
Net Gain on Sale of Securities....................................................................... (485) (418)
Changes in Accruals and Other, Net................................................................... 1,307 1,718
Net Increase in Loans Held for Sale.................................................................. (1,668) (2,881)
Net Decrease (Increase) in Trading Account Assets.................................................... 338 (4,646)
Net (Decrease) Increase in Trading Account Liabilities............................................... (294) 3,840
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Total Adjustments.................................................................................... 444 (87)
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Net Cash Provided by Operating Activities............................................................ 3,136 2,443
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Cash Flows from Investing Activities
Net (Increase) Decrease in Deposits at Interest with Banks........................................... (1,036) 305
Securities -- Available for Sale
Purchases......................................................................................... (44,078) (39,792)
Proceeds from Sales............................................................................... 18,763 22,001
Maturities........................................................................................ 22,400 14,215
Net (Increase) Decrease in Federal Funds Sold and Securities Purchased Under Resale Agreements....... (3,179) 487
Net Increase in Loans................................................................................ (132,289) (84,728)
Proceeds from Sales of Loans......................................................................... 121,755 74,942
Business Acquisitions................................................................................ (3,890) -
Capital Expenditures on Premises and Equipment....................................................... (973) (865)
Proceeds from Sales of Premises and Equipment, Subsidiaries and Affiliates, and OREO................. 397 861
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Net Cash Used in Investing Activities................................................................ (22,130) (12,574)
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Cash Flows from Financing Activities
Net Increase in Deposits............................................................................. 23,314 9,143
Net (Decrease) Increase in Federal Funds Purchased
and Securities Sold Under Repurchase Agreements.................................................... (556) 145
Net (Decrease) Increase in Commercial Paper and Funds Borrowed....................................... (1,195) 2,596
Proceeds from Issuance of Long-Term Debt............................................................. 6,234 5,357
Repayment of Long-Term Debt.......................................................................... (6,029) (4,078)
Redemption of Preferred Stock........................................................................ (1,040) (175)
Proceeds from Issuance of Common Stock............................................................... 243 354
Treasury Stock Repurchases........................................................................... (483) (1,470)
Dividends Paid....................................................................................... (868) (832)
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Net Cash Provided by Financing Activities............................................................ 19,620 11,040
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Effect of Exchange Rate Changes on Cash and Due from Banks........................................... (104) (435)
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Net Increase in Cash and Due from Banks.............................................................. 522 474
Cash and Due from Banks at Beginning of Period....................................................... 8,585 6,905
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Cash and Due from Banks at End of Period............................................................. $ 9,107 $ 7,379
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Supplemental Disclosure
Cash Paid During the Period for:
Interest............................................................................................. $9,953 $8,550
Income Taxes......................................................................................... 1,527 1,767
Non-Cash Investing Activities
Transfer from Loans to OREO.......................................................................... 192 282
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Calculation of Earnings Per Share
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Third Quarter Nine Months
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(In Millions, except Per Share Amounts) 1998 1997 1998 1997
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Net Income ..................................... $ 530 $ 511 $ 2,692 $ 2,530
Dividends on Preferred Stock ................... (19) (34) (79) (106)
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Income Applicable to Common Stock .............. $ 511 $ 477 $ 2,613 $ 2,424
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Weighted-Average Common Shares Outstanding ..... 451.2 457.9 450.9 459.3
Dilutive Effect of Employee Stock Plans (A) .... 10.6 13.0 11.7 13.4
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Adjusted for Diluted Computation ............... 461.8 470.9 462.6 472.7
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Earnings Per Share
Basic .......................................... $ 1.13 $ 1.04 $ 5.80 $ 5.28
Diluted ........................................ 1.11 1.01 5.65 5.13
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(A) Includes the dilutive effect of stock options, stock purchase agreements,
and restricted stock computed using the treasury stock method and shares
issuable under deferred stock awards.
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