Citigroup Inc., a diversified financial services holding company, provides various financial products and services for consumers, corporations, governments, and institutions worldwide. The company operates through two segments, Citicorp and Citi Holdings. The Citicorp segment offers traditional banking services to retail customers through retail banking, commercial banking, Citi-branded cards, and Citi retail services. It also provides various banking, credit card lending, and investment services through a network of local branches, offices, and electronic delivery systems. In addition, this segment provides wholesale banking products and services, including fixed income and equity sales and trading, foreign exchange, prime brokerage, derivative services, equity and fixed income research, corporate lending, investment banking and advisory services, private banking, cash management, trade finance, and securities services to corporate, institutional, public sector, and high-net-worth clients. As of December 31, 2016, it operated 2,649 branches in 19 countries. The Citi Holdings segment provides consumer loans; and portfolio of securities, loans, and other assets. Citigroup Inc. was founded in 1812 and is based in New York, New York.
Business Analysis of Citigroup
The Banking Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Citigroup compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Citigroup to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of Citigroup with an interactive chart.
- Revenue Growth: Citigroup reported a revenue growth of -8.5% year-on-year during 2016. Banking Industry grew at 1.5% in the same period
- COGS share of Revenues: As a percentage of revenue, Citigroup spent 10.0% of its total revenues on COGS. Banking industry average (COGS share of revenue) in the same period was 1.5%
- R&D share of Revenues: Citigroup R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, Citigroup spent 59.3% of its total revenues on Sales, Marketing, and General Administration (SG&A). Banking industry average SG&A spending in the same period was 53.7%
- Inventory share of Revenues: Citigroup Inventory share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Payable share of Revenues: As a percentage of revenue, Citigroup invested 81.8% of its total revenues on Accounts Payable (A/P) Banking industry average Accounts Payable investment in the same period was 54.0%
- Accounts Receivable share of Revenues: As a percentage of revenue, Citigroup invested 41.3% of its total revenues on Accounts Receivable (A/R). Banking industry average Accounts Receivable investment in the same period was 30.1%
- PP&E share of Revenues: Citigroup PP&E share of Revenues details are not available because either company does not share the data or we do not have it
- Intangibles share of Revenues: As a percentage of revenue, Citigroup invested 40.6% of its total revenues on Intangibles. Banking industry average Intangibles investment in the same period was 60.1%
- Net Margins: Citigroup Net Margins in the year 2016 were 21.3%. Banking industry average Net Margins in the same period were 23.5%
Sector and Industry Association of Citigroup
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.
Citigroup is associated with Financials Sector Group, Banking Sector, and Banking Industry.
Banking sector is comprised of a single industry: Banking. Its definition is as follows:
- Banking industry includes banks providing a broad range of financial services, including retail banking, loans and money transmissions.
Industry Ranking of Citigroup
With $69.9 billion revenues, Citigroup ranked number 4 of all the companies in the US Banking industry. There were a total of 179 public companies in the US Banking industry that had revenues greater than $50 million during 2016.
The top-10 companies in the US Banking industry by revenues during 2016 were:
- JPMorgan Chase ($95.7 billion)
- Wells Fargo ($84.5 billion)
- Bank of America ($83.7 billion)
- Citigroup ($69.9 billion)
- US Bancorp ($19.8 billion)
- PNC Financial Services Group ($15.2 billion)
- BB&T ($10.2 billion)
- SunTrust Banks ($8.2 billion)
- Fifth Third Bank ($6 billion)
- Regions Financial ($5.3 billion)
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.