Citigroup (C) won plaudits last year when it trotted out a new advertising slogan–“A deal is a deal”–and a promise not to raise interest rates on credit-card holders. Well, it looks like Citigroup’s marketing team is at least as unreliable as its traders. Citi is apparently backing down on this promise. NYT:
The company is quietly reconsidering its pledge as it confronts a host of financial troubles, according to Citigroup executives. A decision could come this week. Samuel Wang, a spokesman for Citigroup, declined to comment.
Several Citigroup executives emphasised the ‘deal is a deal’ slogan before members of Congress and to consumer groups. The pledge helped Citigroup fend off greater regulation of the card industry and distinguished the company as an industry leader.
After $40 billion in writedowns the firm is starved for cash and customers weren’t as impressed with the move as Citi thought they would be. Among all the complex fine print, customers couldn’t really differentiate Citi’s offer from all the others:
“We hoped and expected that these two points of differentiation would lead customers to vote with their feet,’ John P. Carey, the chief administrative officer for Citigroup’s credit card unit, told a Congressional panel in April. ‘We have been disappointed with the results we have seen so far.”
It will be interesting to see which promise Citi breaks next. Here’s to the next writedown.