Citigroup in China

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Citigroup is an excellent example of an organization that has displayed environmental adaptability. However, the environment in China is unique. Review the pros/cons on whether Citigroup has displayed adaptability in its attempt to expand operations in China. Please review those ways in which you believe Citigroup has displayed adaptability in its attempt to expand operations in China and those ways in which you believe that haven't displayed adaptability. State some of the main arguments (along with evidence to substantiate the arguments).

Overview of Citigroup Background

Citigroup Inc. is today's pre-eminent financial services company, with some 200 million customer accounts in more than 100 countries. Major brand names under Citigroup's trademark red umbrella include Citi Cards, CitiFinancial, CitiMortgage, CitiInsurance, Primerica, Diners Club, The Citigroup Private Bank, and CitiCapital. According to Forbes Global 2000, it is the world's biggest company and the most profitable financial services firm. Its formation was announced on April 7, 1998 through a merger of Citicorp and Travelers Group. It was the first US Company to combine banking with insurance underwriting since the Great Depression.

Business Divisions

Citigroup is organized into three major business groups - Global Consumer, Corporate and Investment Banking, and Global Wealth Management. In addition to two stand-alone businesses are Citigroup Asset Management and Citigroup Alternative Investments.

The Global Consumer Group is comprised of three sub-divisions, Cards (credit cards), Consumer Finance, and Retail Banking. The credit card business on average delivers about 40% of the profits of this group. Citigroup is the largest provider of credit cards in the world, a position long held by Citicorp, and increased by many acquisitions of card portfolios. The Consumer Finance Division (called Citifinancial) accounts for about 20% of the consumer group's profits. Citibank is about the fifth largest retail bank in the United States, and it has branches in countries throughout the world. The biggest part of retail banking however is Banamex, the largest bank in Mexico, which Citigroup owns. Overall the Global Consumer group contributes more than half of all the profits for Citigroup.

The Global Corporate and Investment bank consists of two subdivisions, capital markets & banking, and global transaction services. This division essentially handles large corporate cash management, lending, and Investment Banking. Citigroup's investment bank is one of the largest, frequently topping many League Tables. The final division is called Private Client Services, a euphemism for a stock brokerage. This division is branded Smith Barney, and is the second largest stock broker in the world. It usually contributes however, only around 6% of Citigroup's profits. Through its subsidiaries, Citigroup offers banking, lending, insurance, investment, mortgage, asset management. Citigroup sets itself apart from its top three competitors: JP Morgan Chase & Co., Bank of America Corp. and Deutsche Bank AG by the extent of its global breadth.

Overview of China

China is becoming one of the most prestigious countries of the world. Industry is largely based on state and joint ownership, noticeable by growing technological advancements and productivity. Major industrial centers are located in Beijing-Tianjin- Tangshan area, Liaoning Province, Wuhan and Shanghai. Chinese currency is called Renminbi, which means "People's Currency." The popular unit of Renminbi is Yuan. Agriculture dominates in this huge area, usually favored by a mild or sub-tropical climate. The culture is one of the world's oldest and most complex civilizations. China has a history with over 5,000 years of artistic, philosophical, and political advancement. Even though regions differ, they still provide a sense of diversity, but similarities in language and religion that is notable of common ...