The Dramatic Highlights From Citi's 200-Year History

sanford weill sandy citi

This year, Citi marks its 200th anniversary on planet Earth.

And as with the other banking and wealth creation histories we’ve recently told, the tale of Citi is a heady mix of patriotism and gore.

The bank was instrumental in supporting the country’s rise to world power at the turn of the last century.

Yet it played a role in nearly every financial crisis the country’s experienced.

For the full story of this American institution, read on.

Citibank was born from anger.

The charter of the First Bank of the United States was allowed to lapse in 1811 thanks to opposition from Jefferson about centralization.

In its stead, northern merchants, led by Alexander Hamilton, applied to charter their own banks, which they hoped would be large enough to replicate the FBUS' economy of scale. The City Bank of New York was created in June 1812.

Samuel Osgood, a Revolutionary War hero who'd served alongside Hamilton in Washington's cabinet, was its first president.

Source: New York Times

The bank's first big splash came from financing armaments during the War of 1812.

It was one of the first to participate in lending efforts, a crucial decision at a time when Treasury had been caught flat-footed by the termination of the FBUS.

Source: Citi

Moses Taylor was the bank's most important president of the 19th century.

He first became involved with the bank after the Panic of 1837, and slowly acquired a controlling interest. In 1856, he was named president, and served until 1882.

Source: Encyclopedia of American business history, Vol. 1

As with many titans of the age, Taylor did some good and bad.

He was a major financier of the Union war effort. But he was also associated with the corrupt Tammany Hall group.

Source: The Business Career of Moses Taylor

In 1865, the bank changed its name to The National City Bank of New York.

This was a product of joining the country's new national banking system.

Source: Citi

In 1891, James Stillman is elected president of the bank and helps lead America onto the world stage.

Stillman practically owned the state of Texas when he took over as head of the bank (though he'd acquired most of his fortune through his father, a cotton baron).

Under Stillman, the bank pioneered foreign-exchange trading, providing major financing to Spain and Japan. It also began to build important connections in Latin America, opening the first-ever foreign branch of an American bank in Buenos Aires.

Source: Texas State Historical Association, Citi

Yet it was seen by some as an 800-lb. gorilla.

In 1921, Charles E. Mitchell, the most controversial figure in the bank's history, is elected to head the bank.

Mitchell was later accused, though acquitted, of tax evasion.

Source: Time

In 1955, the bank changed its name to The First National City Bank of New York.

Six years later, it completed its 41-story world headquarters on Park Avenue, where it still stands.

Source: Citi

He views it as a technique the bank used to avoid interest rate limits, weakening the bank regulatory structure put in place by Roosevelt.

Source: Columbia Journalism Review

Two years later the bank became Citibank, N.A. (for national association).

Source: Citi

Around this time, Sandy Weill begins his collision course with Citi.

He'd become president of American Express in the early 80s. Jamie Dimon is said to have been his protege.


In 1988, Weill embarked on a merger spree.

While serving as CEO of a mid-size credit and insurance firm, Weill bought Primerica, which had itself just purchased Smith Barney. travellers, Aetna and Shearson followed.


Meanwhile, Citicorp had once again become the largest bank holding company in the world by 1993.

Source: Citi

Finally in 1998, Citigroup Inc. is born.

Technically, Weill's travellers Group purchased the entirety of Citicorp shares for $70 billion. Salomon Smith Barney remained a wholly owned subsidiary.


The merger blew out Glass-Steagall.

The law was officially repealed a year after the merger. Not coincidentally, former U.S. Treasury Secretary Robert E. Rubin had joined Citi as an adviser in 1999.

Source: Columbia Journalism Review

Jack Grubman, Salmon Smith Barney's top analyst, helps inflate the tech bubble.

'Don't Panic: Emerging Telecom Model Is Still Valid,' was the title of one research note just months before Global Crossing collapsed.

Grubman ended up paying a $15 million fine for misleading investors and was banned from the securities industry.

Source: Columbia Journalism Review

Citi also had to reboot its entire brokerage division for its role in the tech bubble.

In 2002, it paid the second-largest settlement in securities history, $2.7 billion, to WorldCom investors and bondholders over fraud charges.

In 2003, it renamed Salomon Smith Barney 'Citigroup Global Markets Inc.' 'Smith Barney' became a private wealth management division.

Source: Columbia Journalism Review

But its misdeeds hadn't entirely abated.

It also ended up paying $3.7 billion in a settlement with Enron investors.

Source: Columbia Journalism Review

But the firm's image wasn't so tarnished that Maria Bartiromo couldn't date senior executive Todd Thomson.

Thomson was eventually fired, though -- he'd used his corporate account to woo her.

Source: USA Today

October 2008: Citi is now a zombie...

...And receives the first of three government bailouts. Chuck Prince, Sandy Weill's successor had been forced out a year earlier after the bank had to write down $11 billion in toxic mortgages.

Source: Columbia Journalism Review

February 2009: The government takes a controlling interest in Citi...

...After giving it a third bailout.

Source: Columbia Journalism Review

2012: Happy 200th Anniversary!

For more sordid tales of banking domination...

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