117-598: The Public Investment Fund ( PIF ; Arabic: صندوق الاستثمارات العامة ) is the sovereign wealth fund of Saudi Arabia . It is among the largest sovereign wealth funds in the world with total estimated assets of US$ 930 billion ( £ 718.2 billion). It was created in 1971 for the purpose of investing funds on behalf of the Government of Saudi Arabia . The wealth fund is controlled by Crown Prince Mohammed bin Salman , Saudi Arabia's de facto ruler since 2015. More than 60% of
234-405: A whistleblower in 2006, 60% of the mortgages were defective. The number of bad mortgages began increasing throughout 2007 and eventually exceeded 80% of the volume. Many of the mortgages were not only defective but were a result of mortgage fraud . Bowen attempted to rouse the board via weekly reports and other communications. On November 3, 2007, Bowen emailed Citigroup chairman Robert Rubin and
351-515: A $ 1.6 billion loss in 2009. Late in 2010, the government sold its remaining stock holding in the company, yielding an overall net profit to taxpayers of $ 12 billion (~$ 16.4 billion in 2023). A special IRS tax exception given to Citi allowed the US Treasury to sell its shares at a profit, while it still owned Citigroup shares, which eventually netted $ 12 billion. According to Treasury spokeswoman Nayyera Haq, "This (IRS tax) rule
468-953: A $ 713.7 million stake in Boeing , around $ 522 million in Citigroup , a $ 522 million stake in Facebook, a $ 495.8 million stake in Disney and a $ 487.6 million stake in Bank of America . It also disclosed a small stake in Berkshire Hathaway . PIF also disclosed an $ 827.7 million stake in oil company BP . In 2020, PIF purchased a 2.32% stake (valued at $ 1.5 billion) in India's Jio Platforms , and reduced its holdings in US stocks to $ 7 billion from $ 10.1 billion in
585-530: A 2014 study, SWFs are not created for reasons related to reserve accumulation and commodity-export specialization. Rather, the diffusion of SWF can best be understood as a fad whereby certain governments consider it fashionable to create SWFs and are influenced by what their peers are doing. As market participants, SWFs influence other institutional investors, who may see investments made alongside SWFs as inherently safer. This effect can be seen with increasing frequency, especially with regard to investments made by
702-717: A 5% stake in the Japanese video game company Nintendo , and the following month, an 8% stake in Embracer Group with a $ 1 billion investment. PIF owned a major indirect stake in Twitter prior to its acquisition by Elon Musk although many Saudis who use the platform for political dissent and activism are arbitrarily arrested and imprisoned. In November 2023 PIF acquired a 10% stake in Heathrow Airport after Ferrovial sold its 25% share. The remaining 15%
819-443: A Mexican oil services firm. The plaintiffs claimed that Citigroup conspired with Oceanografia to accept falsified work estimates. The courts found in favor of Citigroup. In April 2016, Citigroup announced that it would eliminate its bad bank , Citi Holdings. Citi Capital Advisors (CCA), formerly Citi Alternative Investments, was a hedge fund that offered various investment strategies across multiple asset classes. To comply with
936-636: A Shanghai-based equity and debt brokerage operating in the Chinese market. In January 2019, Citigroup announced that it sold its stake in the business to its Chinese partner. The company failed the Comprehensive Capital Analysis and Review stress tests in 2012 due to Citi's high capital return plan and its international loans, which were rated by the Fed to be at higher risk than its domestic American loans. In 2013, Sanjiv Das
1053-575: A controversial statement before the establishment of the circuit, saying that the Saudis were "scary motherf–kers to be involved with". He said, "We know they killed Khashoggi and have a horrible record on human rights". Despite that, Mickelson joined LIV Golf, calling it "a once-in-a-lifetime opportunity" to reshape the PGA Tour. Graeme McDowell also gave similar answers and said, "We're not politicians, we're professional golfers. If Saudi Arabia wants to use
1170-550: A group of New York merchants , the bank opened for business on September 14 of that year, and Samuel Osgood was elected as the first President of the company. After the Panic of 1837 , Moses Taylor acquired control of the company. The company's name was changed to The National City Bank of New York in 1865 after it converted its state charter into a federal charter and joined the new U.S. national banking system. After Taylor died in 1882, Percy Rivington Pyne I became president of
1287-537: A loss calculated at $ 17.7 billion, after the value of investments was written down. The losses were related to the investments in WeWork and Uber Technologies Inc. In the 39-year history of SoftBank, the Saudi Arabia-backed funds paid the group its worst-ever losses, where the overall company losses were 1.36 trillion yen (more than $ 12.5 billion). During the 2017 Saudi-US CEO Forum, which
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#17327982915941404-507: A notable exception to this more typical model. Stabilization SWFs are created to reduce the volatility of government revenues, to counter the boom-bust cycles' adverse effect on government spending and the national economy. Savings SWFs build up savings for future generations. One such fund is the Government Pension Fund of Norway . It is believed that SWFs in resource-rich countries can help avoid resource curse , but
1521-1016: A pledge to "assemble 150 Lockheed Martin Black Hawk helicopters" in Saudi Arabia, representing 450 jobs in Saudi Arabia" as part of the "$ 6 billion deal for Black Hawks." In October 2017 it was announced that PIF would aim to increase its assets under management to more than $ 400 billion and create more than 20,000 new jobs by 2020. Al-Rumayyan presented a new investment strategy for the fund, based on four objectives of maximizing assets, investing in new sectors, localizing technologies, and developing economic partnerships. He also said PIF would borrow conservatively to finance specific assets and would seek further partnerships such as those with Blackstone and SoftBank . In September 2018 Al-Rumayyan announced PIF's first step in incorporating loans and debt instruments into its long-term strategy, with an $ 11 billion loan facility. The following month he said
1638-713: A product pusher. On January 16, 2009, Citigroup announced its intention to reorganize itself into two operating units: Citicorp for its retail and institutional client business, and Citi Holdings for its brokerage and asset management. Citigroup will continue to operate as a single company for the time being, but Citi Holdings managers will be tasked to "take advantage of value-enhancing disposition and combination opportunities as they emerge", and eventual spin-offs or mergers involving either operating unit were not ruled out. Citi Holdings consists of Citi businesses that Citi wants to sell and are not considered part of Citi's core businesses. The majority of its assets are U.S. mortgages. It
1755-621: A prospective buying consortium consisting of the Public Investment Fund, PCP Capital Partners and Reuben Brothers . However, the Premier League controversially refused to ratify the deal and so Mike Ashley subsequently engaged in various legal proceedings against the Premier League in an attempt to complete the takeover. On 7 October 2021, it was announced that the club would be acquired by the consortium led by
1872-475: A result of the criticism and the U.S. Government's majority holding of Citigroup's common stock , compensation and bonuses were restricted from February 2009 until December 2010. In 2009, Jane Fraser , the CEO of Citi Private Bank, stopped paying its bankers with a commission for selling investment products, in a move to bolster Citi Private Bank's reputation as an independent wealth management adviser, as opposed to
1989-536: A retail bank, the third largest issuer of credit cards , as well as its wealth management business. Citigroup was formed on October 8, 1998, following the merger of Citicorp, the bank holding company for Citibank , and Travelers to create the world's largest financial services organization. Citibank , (formerly City Bank of New York) was chartered by the State of New York on June 16, 1812, with $ 2 million (~$ 43.4 million in 2023) of capital. Serving
2106-520: A single company in December 1993. With the acquisition, the group became Travelers Inc. Property & casualty and life & annuities underwriting capabilities were added to the business. Meanwhile, the distinctive Travelers red umbrella logo, which was also acquired in the deal, was applied to all the businesses within the newly named organization. During this period, Travelers acquired Shearson Lehman —a retail brokerage and asset management firm that
2223-402: Is a mixed bag, its primary objective is to wind down some non-core businesses and reduce assets, and strategically "breaking even" in 2015. On February 27, 2009, Citigroup announced that the U.S. government would take a 36% equity stake in the company by converting US$ 25 billion in emergency aid into common stock with a United States Treasury credit line of $ 45 billion to prevent
2340-555: Is an American multinational investment bank and financial services company based in New York City . The company was formed in 1998 by the merger of Citicorp, the bank holding company for Citibank , and Travelers ; Travelers was spun off from the company in 2002. Citigroup is the third-largest banking institution in the United States by assets; alongside JPMorgan Chase , Bank of America , and Wells Fargo , it
2457-644: Is due to political instability, while economic determinants generally play a less important role. SWFs in unstable countries may provoke risks for recipient states of SWF investments, given that the instability in SWF-sponsor countries makes those investments uncertain and likely to be disinvested to weather political risk in the short-term. Highly stable countries, such as Denmark, Qatar, China, or Australia are less likely to experience SWF depletion precisely because of their political stability. Citigroup Citigroup Inc. or Citi ( stylized as citi )
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#17327982915942574-538: Is not always possible or desirable to hold this excess liquidity as money or to channel it into immediate consumption. This is especially the case when a nation depends on raw material exports like oil, copper or diamonds. In such countries, the main reason for creating a SWF is because of the properties of resource revenue: high volatility of resource prices, unpredictability of extraction, and exhaustibility of resources. SWFs are primarily commodity-based and many have been established by oil-rich states. SWFs of China are
2691-704: Is now worth $ 853 billion. Another early registered SWFs is the Revenue Equalization Reserve Fund of Kiribati . Created in 1956, when the British administration of the Gilbert Islands in Micronesia put a levy on the export of phosphates used in fertilizer , the fund has since then grown to $ 520 million. SWFs are typically created when governments have budgetary surpluses and have little or no international debt. It
2808-1015: Is one of the Big Four banking institutions of the United States. It is considered a systemically important bank by the Financial Stability Board , and is commonly cited as being " too big to fail ". It is one of the eight global investment banks in the Bulge Bracket . Citigroup is ranked 36th on the Fortune 500 , and was ranked #24 in Forbes Global 2000 in 2023. Citigroup operates with two major divisions: Institutional Clients Group (ICG), which offers investment banking and corporate banking services, as well as treasury and trade solutions (TTS) and securities services such as custodian banking ; and Personal Banking and Wealth Management (PBWM), which includes Citibank ,
2925-564: Is widely believed most have diversified hugely into assets other than short-term, highly liquid monetary ones, though almost no data is publicly available to back up this assertion. The term "sovereign wealth fund" was first used in 2005 by Andrew Rozanov in an article entitled, "Who holds the wealth of nations?" in the Central Banking Journal . The previous edition of the journal described the shift from traditional reserve management to sovereign wealth management; subsequently
3042-836: The ATP Tour and the WTA Tour which wouldn't have involved grand slam events and would have involved the two tours being merged into a single PIF lead tour It is unclear if the offer was later rejected or accepted. On 7 October 2024, PIF announced a strategic partnership with Central Group . Through this alliance, PIF acquired a 40% stake in Selfridges Group, following a binding agreement to acquire Signa Holding ’s stake in Selfridges , pending regulatory approvals. In this arrangement, PIF held 40% of both Selfridges Group's operating and property companies, while Central Group owned
3159-743: The Kuwait Investment Authority during the Gulf War managed excess reserves above the level needed for currency reserves (although many central banks do that now). The Government of Singapore Investment Corporation , Temasek Holdings , or Mubadala are partially the expression of a desire to bolster their countries' standing as an international financial centre. The Korea Investment Corporation has since been similarly managed. Sovereign wealth funds invest in all types of companies and assets, including startups like Xiaomi and renewable energy companies like Bloom Energy. According to
3276-509: The New York Stock Exchange . As a result, late in the evening on November 23, 2008, Citigroup and Federal regulators approved a plan to stabilize the company and forestall a further deterioration in the company's value. On November 24, 2008, the U.S. government announced a massive bailout for Citigroup designed to rescue the company from bankruptcy while giving the government a major say in its operations. A joint statement by
3393-701: The Saudi National Bank , and made the Saudi National Bank the largest shareholder with less than 10% ownership (which, according to the Saudi National Bank, prevented them from having to deal with regulatory requirements for 10%+ shareholder ownership). After the March 2023 United States bank failures had gripped the global banking sector, Saudi National Bank chairman Ammar al-Khudair publicly stated on 15 March 2023 that they would "absolutely not" supply Credit Suisse with more capital (referencing
3510-640: The US Treasury Department , the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) announced: "With these transactions, the U.S. government is taking the actions necessary to strengthen the financial system and protect U.S. taxpayers and the U.S. economy." Citi received the largest amount of TARP funding, "a larger bailout than any other U.S. bank." The bailout called for
3627-799: The central bank . Some sovereign wealth funds may be held by a central bank, which accumulates the funds in the course of its management of a nation's banking system; this type of fund is usually of major economic and fiscal importance. Other sovereign wealth funds are simply the state savings that are invested by various entities for investment return, and that may not have a significant role in fiscal management. The accumulated funds may have their origin in, or may represent, foreign currency deposits, gold, special drawing rights (SDRs) and International Monetary Fund (IMF) reserve positions held by central banks and monetary authorities, along with other national assets such as pension investments, oil funds, or other industrial and financial holdings. These are assets of
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3744-552: The " Everything card " and later to become MasterCard —in 1967. Also in 1967, First National City Bank was reorganized as a one-bank holding company, First National City Corporation, or "Citicorp" for short. The bank had been nicknamed "Citibank" since the 1860s when it began using this as an eight-letter wire code address. In 1974, under the leadership of CEO Walter B. Wriston , First National City Corporation changed its formal name to "Citicorp", with First National City Bank being formally renamed Citibank in 1976. Shortly afterwards,
3861-611: The Cuban sugar industry, since the mid-19th century. The purchase of U.S. overseas bank International Banking Corporation in 1918 helped it become the first American bank to surpass $ 1 billion in assets. During the United States occupation of Haiti and the bank's income from Haiti's loan debt related to the Haiti indemnity controversy , the bank earned some of its largest gains in the 1920s due to debt payments from Haiti, becoming
3978-625: The FDIC after the collapse of IndyMac Bank , with the goal of keeping as many homeowners as possible in their houses. Executive salaries would be capped. As a condition of the federal assistance, Citigroup's dividend payment was reduced to $ 0.01 per share. In a New York Times op-ed, Michael Lewis and David Einhorn described the November 2008 $ 306 billion (~$ 425 billion in 2023) guarantee as "an undisguised gift" without any real crisis motivating it. According to The Wall Street Journal ,
4095-580: The First National City Bank of New York in 1955. The "New York" was dropped in 1962 on the 150th anniversary of the company's foundation. The company organically entered the leasing and credit card sectors, and its introduction of U.S. dollar-denominated certificates of deposit in London marked the first new negotiable instrument in the market since 1888. The bank introduced its First National City Charge Service credit card—popularly known as
4212-535: The Government Pension Fund of Norway, Abu Dhabi Investment Authority , and Temasek Holdings, and China Investment Corporation. SLFs help facilitate a state's ability to use its selective equity investments to promote its industrial policies and strategic interests. The growth of sovereign wealth funds is attracting close attention because: The governments of SWFs commit to follow certain rules: A number of transparency indices sprang up before
4329-597: The Great Depression—forbade banks to merge with insurance underwriters, and meant Citigroup had between two and five years to divest any prohibited assets. Weill stated at the time of the merger that they believed "that over that time the legislation will change ... we have had enough discussions to believe this will not be a problem". Indeed, the passing of the Gramm-Leach-Bliley Act in November 1999 vindicated Reed and Weill's views, opening
4446-651: The PGA were accepting "Saudi blood money." The Associated Press wrote that the merger of the PGA Tour and LIV Golf marked a turnaround for the authoritarian regime in Saudi Arabia, as the Mohammed bin Salman regime had been isolated for years over human rights abuses and the murder of Jamal Khashoggi. In 2022 PIF made a $ 1.5 billion investment in Credit Suisse as part of a broader goal of diversifying its portfolio into global banking. The PIF connected Credit Suisse to
4563-527: The PIF as of April 2024: PIF has been characterized as among the least transparent sovereign wealth funds in the world. In 2016, The Wall Street Journal noted that none of the fund's investments were named. According to Steffen Hertog, a professor at the London School of Economics, the PIF "is seen as opaque, a black box. Few know what's going on there, including sometimes other government ministries." As
4680-564: The PIF is a ministry-operated company with an overwhelming focus on domestic investments, some scholars characterize it as a "quasi-sovereign wealth fund." The funds investments within the kingdom include dates, camels, and coffee, but also amusement, sports, tourism and renewable energy. The governance structure of PIF has been called into question, specifically with respect to how much control Mohammad bin Salman holds on decision making at PIF. In October 2022, Yasir Al-Rumayyan (the governor of PIF) gave an interview where he spoke about resisting
4797-506: The Premier League regarding the Saudi takeover, saying the disclosure could "harm" relations with Saudi Arabia. The other 19 Premier League clubs condemned the takeover, saying it damaged the Premier League's brand. In October 2021 a division of the PIF, Golf Saudi funded the establishment of LIV Golf Investments, with Greg Norman declared to be its CEO. The private company introduced a professional tour, LIV Golf, also referred to beforehand as
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4914-514: The Primerica name, and employed a " cross-selling " strategy such that each of the entities within the parent company aimed to sell each other's services. Its non-financial businesses were spun off . In September 1992, Travelers Insurance , which had suffered from poor real estate investments and sustained significant losses in the aftermath of Hurricane Andrew , formed a strategic alliance with Primerica that would lead to its amalgamation into
5031-873: The Principles, representing collectively 80% of the assets managed by sovereign funds globally or US$ 5.5 trillion. Assets under management of SWFs amounted to $ 7.94 trillion as of 24 December 2020. Countries with SWFs funded by oil and gas exports, totaled $ 5.4 trillion as of 2020. Non-commodity SWFs are typically funded by transfer of assets from official foreign exchange reserves, and in some cases from government budget surpluses and privatization revenues. Middle Eastern and Asian countries account for 77% of all SWFs. Numerous SWFs have gone bust throughout history. The most notable ones have been Algeria's FRR, Brazil's FSB , Ecuador's numerous SWF arrangements, Papua New Guinea's MRSF, and Venezuela's FIEM and FONDEN. The main reason why these funds have been exhausted
5148-562: The Public Investment Fund, after the Premier League stated it had received "legally binding assurances that the Kingdom of Saudi Arabia will not control Newcastle United Football Club". Human rights organizations criticized the Premier League for allowing PIF to purchase a Premier League club. Amnesty International pointed to Saudi Arabia's human rights record , and said that the Premier League must introduce standards whereby human rights violators cannot own Premier League clubs. Amnesty called
5265-707: The Santiago Principles, some more stringent than others. To address these concerns, some of the world's main SWFs came together in a summit in Santiago , Chile, on 2–3 September 2008. Under the leadership of the IMF, they formed a temporary International Working Group of Sovereign Wealth Funds. This working group then drafted the 24 Santiago Principles , to set out a common global set of international standards regarding transparency, independence, and accountability in
5382-530: The Saudi government, which has itself faced significant criticism around the lack of human rights in the country . The Saudi Arabian Public Investment Fund (PIF) was established by the King Faisal bin Abdulaziz Al Saud in 1971 by Royal Decree M/24 with the stated intent to provide financing support for projects of strategic significance to the national economy. For much of its history, the PIF
5499-727: The Saudi state. Some of PIF's assets were transferred to the organization in 2017 after the Saudi regime conducted an "anti-corruption" purge whereby assets of 400 of Saudi Arabia's richest individuals were seized by the regime. [REDACTED] World portal Sovereign wealth fund A sovereign wealth fund ( SWF ), or sovereign investment fund is a state-owned investment fund that invests in real and financial assets such as stocks , bonds , real estate, precious metals , or in alternative investments such as private equity funds or hedge funds . Sovereign wealth funds invest globally. Most SWFs are funded by revenues from commodity exports or from foreign exchange reserves held by
5616-774: The Super Golf League. It came as a new challenge against the PGA Tour , after the World Golf Tour and the Premier Golf League. LIV Golf's strategy differed from other leagues as it offered the richest golf tournaments in history and was able to convince star players to take part. In June 2022, the LIV Golf Invitational Series commenced its eight-event season, with total prize money of $ 255 million. The Saudi PIF backed
5733-637: The U.S. It also has Latin America partnership cards with Colombia-based airline Avianca and with Banamex and AeroMexico; and a merchant loyalty program in Europe. Citibank is also the first and currently the only international bank to be approved by Chinese regulators to issue credit cards under its own brand without cooperating with Chinese state-owned domestic banks. In 2012, the Global Markets division and Orient Securities formed Citi Orient Securities,
5850-474: The UK if the government blocked the takeover – these threats occurred in the context of a strategic partnership between the Saudis and the UK where the Saudis proposed to invest $ 30 billion into the UK economy over a ten-year period. The attempted takeover was "a blatant example of Saudi sportswashing ", according to Kate Allen of Amnesty International UK. The British government blocked details of its talks with
5967-608: The United States. While the PSF was first funded by an appropriation from the state legislature, it also received public lands at the same time that the PUF was created. The first SWF established for a sovereign state is the Kuwait Investment Authority , a commodity SWF created in 1953 from oil revenues before Kuwait gained independence from the United Kingdom. As of July 2023, Kuwait's Sovereign Wealth Fund, or locally known as Ajyal Fund,
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#17327982915946084-532: The White House. PIF advisers raised questions about the merits of the investment, but PIF management overruled the advisers. By April 2022, Kushner's equity firm primarily depended on Saudi money, as it only had $ 2.5 billion under its management. Within the Donald Trump administration, Kushner was a staunch defender of Saudi ruler Mohammed bin Salman. According to ethics experts, the investment created
6201-416: The ambitious international stock buying activities being promulgated by Mohammad bin Salman at the beginning of 2020 as the world was grappling with COVID-19 . The concern was that giving the PIF tens of billions of dollars from the Saudi central bank to fund this stock buying was risky and might devalue the local currency. Although Mohammad bin Salman is the chairman of PIF, PIF has denied "any suggestion that
6318-519: The appearance of potential payback for Kushner. In 2021 PIF invested $ 1 billion in the investment fund established by former Donald Trump administration official Steven Mnuchin just after he left government. In May 2022 it was reported that Affinity Partners was planning to direct Saudi Arabia's PIF money to Israel. There were multiple meetings by Kushner had with a range of Israeli startups before he picked two of them to make an investment. The Kingdom didn't have diplomatic relations with Israel and
6435-602: The bank launched the Citicard, which pioneered the use of 24-hour ATMs . John S. Reed was elected CEO in 1984, and Citi became a founding member of the CHAPS clearing house in London. Under his leadership, the next 14 years would see Citibank become the largest bank in the United States and the largest issuer of credit cards and charge cards in the world, and expand its global reach to over 90 countries. Travelers Group, at
6552-410: The bank's chief financial officer , head auditor, and the chief risk management officer to again expose the risk and potential losses, claiming that the group's internal controls had broken down and requesting an outside investigation of his business unit. The subsequent investigation revealed that the Consumer Lending Group had suffered a breakdown of internal controls since 2005. Despite the findings of
6669-473: The bank's reputation. On April 6, 1998, Citicorp and Travelers announced a merger. The deal would enable Travelers and Citicorp to access each other's customer base for the marketing of financial products. In the transaction, Travelers Group acquired all Citicorp shares; existing shareholders of each company owned about half of the new firm. While the new company maintained Citicorp's "Citi" brand in its name, it adopted Travelers' distinctive "red umbrella" as
6786-443: The bank. He died nine years later and was replaced by James Stillman . The bank became the largest bank in New York City after the Panic of 1893 and the largest bank in the U.S. by 1895. It became the first contributor to the Federal Reserve Bank of New York in 1913, and the following year it inaugurated the first overseas branch of a U.S. bank in Buenos Aires , although the bank had been active in plantation economies, such as
6903-406: The bankruptcy of the company. The government guaranteed losses on more than $ 300 billion of troubled assets and injected $ 20 billion immediately into the company. The salary of the CEO was set at $ 1 per year and the highest salary of employees was restricted to $ 500,000. Any compensation amount above $ 500,000 had to be paid with restricted stock that could not be sold by the employee until
7020-431: The chief underwriter of Citigroup's Consumer Lending Group, began warning the board of directors about the extreme risks being taken on by the mortgage operation that could potentially result in massive losses. The group bought and sold $ 90 billion of residential mortgages annually. Bowen's responsibility was essential to serve as the quality control supervisor ensuring the unit's creditworthiness. When Bowen first became
7137-536: The decision-making or conduct of the board of PIF is unduly influenced (or influenced in any way contrary to the principles of good governance) by the crown prince." Yasir Al-Rumayyan claims he was overruled by Salman of Saudi Arabia , who is still officially king. Yasir Al-Rumayyan also admitted that of the $ 35 billion spent by the PIF as part of this activity, it soon rose to $ 49 billion when markets rose. The fund's domestic investments tend to go to firms owned by elites with long-standing personal connections to
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#17327982915947254-399: The door to financial services conglomerates offering a mix of commercial banking, investment banking, insurance underwriting, and brokerage. Joe J. Plumeri worked on the post-merger integration of the two companies and was appointed CEO of Citibank North America by Weill and Reed. He oversaw its network of 450 branches . J. Paul Newsome, an analyst with CIBC Oppenheimer , said: "He's not
7371-478: The easy way out". LIV Golf was also condemned as another sportswashing tool of Saudi Arabia, which is accused of several human rights violations, including the assassination of Jamal Khashoggi . The CEO Greg Norman and star players had to face questions about their association with LIV Golf, despite the Kingdom's abysmal human rights records. Norman dismissed the questions saying, "We've all made mistakes" and that Saudi wanted "to move forward". Phil Mickelson gave
7488-489: The emergency aid in full and the U.S. government had made a $ 12 billion (~$ 16.4 billion in 2023) profit on its investment in the company. Government restrictions on pay and oversight of the senior management were removed after the U.S. government sold its remaining 27% stake in December 2010. On June 1, 2009, it was announced that Citigroup would be removed from the Dow Jones Industrial Average effective June 8, 2009, due to significant government ownership. Citigroup
7605-551: The emergency government aid was repaid in full. The U.S. government also gained control of half the seats in the board of directors, and the senior management was subjected to removal by the US government if there were poor performance. By December 2009, the U.S. government stake was reduced from a 36% stake to a 27% stake, after Citigroup sold $ 21 billion of common shares and equity in the largest single share sale in U.S. history, surpassing Bank of America's $ 19 billion share sale 1 month prior. By December 2010, Citigroup repaid
7722-443: The event with $ 2 billion in funds. LIV Golf offered the winners prize of each regular event $ 4 million in prize money, in comparison to the PGA Championship ’s $ 2.7 million. Some of the most prominent professional golf players participated in the event, including Phil Mickelson , Dustin Johnson , Graeme McDowell , Sergio García , Martin Kaymer , Louis Oosthuizen , Charl Schwartzel and Lee Westwood . Dustin Johnson
7839-572: The first $ 29 billion in losses. The Treasury would assume the first $ 5 billion in losses; the FDIC would absorb the next $ 10 billion; then the Federal Reserve would assume the rest of the risk. The assets remained on Citigroup's balance sheet; the technical term for this arrangement is ring fencing . In return, the bank gave the U.S. Treasury $ 27 billion of preferred shares and warrants to acquire common stock . The government obtained wide powers over banking operations. Citigroup agreed to try to modify mortgages, using standards set up by
7956-462: The form of collateralized debt obligation (CDOs), compounded by poor risk management, led Citigroup into trouble as the subprime mortgage crisis worsened in 2007. The company had used elaborate mathematical risk models which looked at mortgages in particular geographical areas, but never included the possibility of a national housing downturn or the prospect that millions of mortgage holders would default on their mortgages. Trading head Thomas Maheras
8073-432: The fund would aim to increase the percentage of international assets in its portfolio from 10% to 50% by 2030. At the Milken Institute in Abu Dhabi in February 2019, Al-Rumayyan announced that PIF would open new offices in London, New York City and San Francisco, and would increase its workforce from 450 to 700 by the end of 2019. He also said the fund would invest in renewable energy projects in Saudi Arabia, including
8190-438: The fund's activities are within Saudi Arabia. Within Saudi Arabia, the fund's investments primarily go to private conglomerates owned by prominent Saudi business families who have close ties to the Saudi ruling family. Outside Saudi Arabia the fund's investments into prominent foreign assets such as Premier League football club Newcastle United have generated controversy due to the fund's lack of transparency and close control by
8307-493: The game of golf as a way for them to get to where they want to be, I think we're proud to help them on that journey." On June 6, 2023 it was announced that LIV Golf and the PGA Tour would merge their commercial businesses into a new for-profit company, with the Public Investment Fund reportedly investing billions into the new company. Critics of the deal accused the PGA of hypocrisy and lamented what they saw as Saudi " sportswashing ." Saudi exiles and human rights activists said that
8424-887: The government aid provided to Citi in 2008/2009 was provided to prevent a worldwide chaos and panic by the potential collapse of its Global Transactions Services (now TTS) division. According to the article, former CEO Pandit said if Citigroup was allowed to unravel into bankruptcy, "100 governments around the world would be trying to figure out how to pay their employees". According to New York Attorney General Andrew Cuomo , Citigroup paid hundreds of millions of dollars in bonuses to more than 1,038 of its employees after it had received its $ 45 billion (~$ 62.5 billion in 2023) TARP funds in late 2008. This included 738 employees each receiving $ 1 million in bonuses, 176 employees each receiving $ 2 million bonuses, 124 each receiving $ 3 million in bonuses, and 143 each receiving bonuses of $ 4 million to more than $ 10 million. As
8541-629: The government to back about $ 306 billion in loans and securities and directly invest about $ 20 billion in the company. The Treasury provided $ 20 billion in Troubled Asset Relief Program (TARP) funds in addition to $ 25 billion given in October. The Treasury Department, the Federal Reserve and the FDIC agreed to cover 90% of the losses on Citigroup's $ 335 billion portfolio after Citigroup absorbed
8658-481: The investigation, Bowen's charges were ignored, even though withholding such information from shareholders violated the Sarbanes–Oxley Act (SOX), which he had pointed out. Citigroup CEO Charles Prince signed a certification that the bank was in compliance with SOX despite Bowen revealing this wasn't so. Citigroup eventually stripped Bowen of most of his responsibilities and informed him that his physical presence
8775-399: The largest commercial bank in the world in 1929. As it grew, the bank became an innovator in financial services, becoming the first major U.S. bank to offer compound interest on savings (1921); unsecured personal loans (1928); customer checking accounts (1936) and the negotiable certificate of deposit (1961). The bank merged with First National Bank of New York in 1955, becoming
8892-488: The last half of 2012. In the first half of 2014, global sovereign wealth fund direct deals amounted to $ 50.02 billion according to the SWFI. Sovereign wealth funds have existed for more than a century, but since 2000, the number of sovereign wealth funds has increased dramatically. The first SWFs were non-federal U.S. state funds established in the mid-19th century to fund specific public services. The U.S. state of Texas
9009-523: The life insurance and annuities underwriting businesses until it sold them to MetLife in 2005. In spite of divesting Travelers Insurance, Citigroup retained Travelers' signature red umbrella logo as its own until February 2007, when Citigroup agreed to sell the logo back to St. Paul Travelers, which renamed itself Travelers Companies . Citigroup also decided to adopt the corporate brand "Citi" for itself and virtually all its subsidiaries, except Primerica and Banamex. Heavy exposure to troubled mortgages in
9126-484: The literature on this question is controversial. Governments may be able to spend the money immediately, but risk causing the economy to overheat, e.g., in Hugo Chávez 's Venezuela or Shah -era Iran. In such circumstances, saving money to spend during a period of low inflation is often desirable. Other reasons for creating SWFs may be economic, or strategic, such as war chests for uncertain times. For example,
9243-463: The local manufacture of solar panels . In March 2019 it was revealed that PIF paid a New York communications firm, Karv Communications, $ 120,000 a month to repair Saudis' damaged reputation after the assassination of Jamal Khashoggi . In 2021 they purchased stakes in the American video game companies Electronic Arts , Take-Two Interactive , and Activision Blizzard . In May 2022, they purchased
9360-645: The market. SWFs grew rapidly between 2008 and 2021, with global assets under management by these funds increasing from approximately $ 4 trillion to more than $ 10 trillion. SWFs invest in a variety of asset classes such as stocks, bonds, real estate, private equity and hedge funds. Many sovereign funds are directly investing in institutional real estate. According to the Sovereign Wealth Fund Institute's transaction database around US$ 9.26 billion in direct sovereign wealth fund transactions were recorded in institutional real estate for
9477-503: The merger of Smith Barney with Morgan Stanley Wealth Management . Citi received $ 2.7 billion and a 49% interest in the joint venture. In June 2013, Citi sold its remaining 49% stake in Smith Barney to Morgan Stanley Wealth Management for $ 13.5 billion following an appraisal by Perella Weinberg. In 2010, Citigroup achieved its first profitable year since 2007. It reported $ 10.6 billion in net profit, compared with
9594-487: The new corporate logo, which was used until 2007. The chairmen of both parent companies, John S. Reed and Sandy Weill respectively, were announced as co-chairmen and co-CEOs of the new company, Citigroup, Inc., although the vast difference in management styles between the two immediately presented question marks over the wisdom of such a setup. The remaining provisions of the Glass–Steagall Act —enacted following
9711-403: The possibility of trouble with its CDOs was so tiny (less than 1/100 of 1%) that they excluded them from their risk analysis. With the crisis worsening, Citigroup announced on January 7, 2008, that it was considering cutting another 5 percent to 10 percent of its 327,000 member-workforce. In 2007, Citigroup acquired 61% of Nikko Asset Management for $ 7.7 billion to take majority control in what
9828-525: The public and private sectors, without the council's prior approval. In March 2015, oversight of PIF was moved from the Ministry of Finance to the Council of Economic and Development Affairs (CEDA). As part of this process, a new PIF was appointed, chaired by Crown Prince Mohammed bin Salman . The board says PIF is aligned with the government's Vision 2030 with the aim to diversify the economy. To bolster
9945-457: The regulatory requirements for 10%+ shareholders as the reason why), which then promptly caused the share price of Credit Suisse to drop 25% more. On 19 March 2023, UBS confirmed their planned acquisition of Credit Suisse . In 2024 the Public Investment Fund announced partnerships with the ATP and WTA tours. In March 2024 PIF announced a $ 2 billion offer to buy both professional tennis tours,
10062-458: The remaining 60%. This partnership aligned with PIF's strategy to invest in key sectors globally and aimed to unlock additional value for Selfridges. By leveraging PIF's investment capabilities alongside Central Group’s industry expertise, the collaboration sought to accelerate Selfridges' growth, reinforcing its status in European luxury retail. The following lists contain all the investments of
10179-543: The resources of the PIF and help in the financing of investments into foreign companies such as Uber and Tesla, the PIF received cash from the Saudi Central Bank , issued debt, and benefitted from the proceeds of the privatisation of Saudi state assets. In 2022 a 4% stake in ownership of Saudi Aramco was transferred to the PIF, which was repeated in 2023 as part of the funds plan to increase assets under management to over $ 1 trillion by 2025. The shares for
10296-400: The second 4% stake in 2023 were valued around $ 78 billion. The move was intended to take advantage of higher hydrocarbon prices towards funding the expansion of the PIF in its overarching goal to diversify investments. A 2021 report by Global SWF found that PIF's Governance, Sustainability, and Resilience (GSR) score had risen by 12% to an overall score of 40% (out of 100%) that year. This
10413-735: The sovereign nations that are typically held in domestic and different reserve currencies (such as the dollar , euro , pound , and yen ). Such investment management entities may be set up as official investment companies, state pension funds, or sovereign funds, among others. There have been attempts to distinguish funds held by sovereign entities from foreign-exchange reserves held by central banks. Sovereign wealth funds can be characterized as maximizing long-term return , with foreign exchange reserves serving short-term "currency stabilization", and liquidity management. Many central banks in recent years possess reserves massively in excess of needs for liquidity or foreign exchange management. Moreover, it
10530-745: The spit-and-polish executive many people expected. He's rough on the edges. But Citibank knows the bank as an institution is in trouble—it can't get away anymore with passive selling—and Plumeri has all the passion to throw a glass of cold water on the bank." Plumeri boosted the unit's earnings from $ 108 million to $ 415 million in one year, an increase of nearly 300%. He unexpectedly retired from Citibank in January 2000. In 2000, Citigroup acquired Associates First Capital Corporation for $ 31.1 billion in stock, which, until 1989, had been owned by Gulf+Western (now part of National Amusements ), and later by Ford Motor Credit Company . The Associates
10647-499: The takeover "an extremely bitter blow for human rights defenders." Hatice Cengiz, the fiancée of Saudi journalist Jamal Khashoggi , who was murdered by operatives of the Saudi regime, urged the Premier League to block PIF's takeover. In April 2021 Saudi crown prince Mohammed bin Salman reportedly asked British Prime Minister Boris Johnson to intervene so that the Premier League would approve PIF's takeover of Newcastle. Bin Salman threatened that there would be economic consequences for
10764-510: The term gained widespread use as the spending power of global officialdom has rocketed upward. China's sovereign wealth funds entered global markets in 2007. Since then, their scale and scope have expanded significantly. SWFs were the first institutions to use sovereign capital in an effort to contain the financial damage in the early stages of the 2007-2008 global financial crisis . SWFs are able to react quickly in such circumstances because unlike regulators, SWFs actively participate in
10881-509: The third quarter. It instead left a stake of $ 2.7 billion in Uber . In 2016 SoftBank Group and the PIF announced that they would establish a SoftBank Vision Fund which aims to invest up to $ 45 billion over five years in the tech sector. The SoftBank Group confirmed that during the fiscal year 2019–2020, the Vision Fund, in which Saudi Arabia invested $ 45 billion, incurred
10998-526: The time of the merger, was a diverse group of financial concerns that had been brought together under CEO Sandy Weill . Its roots came from Commercial Credit, a subsidiary of Control Data Corporation that was taken private by Weill in November 1986 after taking charge of the company earlier that year. Two years later, Weill mastered the buyout of Primerica Financial Services —a conglomerate that had already bought life insurance company A L Williams as well as brokerage firm Smith Barney . The new company took
11115-622: The way that SWFs operate. These were published after being presented to the IMF International Monetary Financial Committee on 11 October 2008. They also considered a standing committee to represent them, and so a new organisation, the International Forum of Sovereign Wealth Funds was set up to maintain the new standards going forward and represent them in international policy debates. As of 2016, 30 funds have formally signed up to
11232-473: Was a passive entity that oversaw the Saudi state's equity in listed firms. When neighboring petrostates began using their sovereign wealth funds for influence, Saudi Arabia followed them. The PIF expanded its staff from 50 in 2015 to nearly 500 in 2018. In July 2014 the Council of Ministers granted the PIF authority to fund new companies inside and outside the Kingdom, either independently or in cooperation with
11349-706: Was acquired by Ardian . PIF acquired a 49% stake in Rocco Forte Hotels in December 2023, valuing the hotel group at £1.4 billion. In 2024 PIF acquired a 38% share of the HOLON Gmbh, Germany. HOLON is a subcompany of the Benteler Group . HOLON is launching the worldwide first electric autonomous shuttle with automotive standards in 2026. In 2021 PIF invested $ 2 billion into a private equity firm that had been newly formed by Jared Kushner , Donald Trump 's son-in-law, shortly after he left
11466-494: Was allegedly paid $ 150 million to join the Saudi-backed series. Phil Mickelson also committed to the series after signing a $ 200 million contract. However, some other renowned players also rejected the new league, with Tiger Woods turned down an offer worth nearly $ 1 billion. A vocal critic of the tournament, Rory McIlroy also stood with PGA Tour and criticized players who joined LIV, stating they were "taking
11583-424: Was also believed to have been approved by Crown Prince Mohammed. Many saw it as a groundwork for a potential normalization of relations between Saudi and Israel. This will be the first known time that money from the Saudi's sovereign wealth fund will go to Israel. On 14 April 2020 it emerged that a deal to transfer ownership of Newcastle United F.C. for £300m had been agreed between incumbent owner Mike Ashley and
11700-589: Was announced that ownership of Saudi Aramco would be transferred to the PIF and that the Kingdom will seek to list 5 percent of Aramco's shares by 2017. PIF owns Qiddiya , spearheads the Red Sea Project for luxury beach resorts, and owns the closed joint-stock company named Neom . PIF owns a 5.7% stake (valued at $ 500 million) in concert distributor Live Nation . In 2020, PIF purchased minority stakes in major U.S. companies including Boeing , Meta Platforms (then Facebook) and Citigroup . PIF disclosed
11817-547: Was close friends with senior risk officer David Bushnell, which undermined risk oversight. As Treasury Secretary, Robert Rubin was said to be influential in lifting the Glass–Steagall Act that allowed Travelers and Citicorp to merge in 1998. Then on the board of directors of Citigroup, Rubin and Charles Prince were said to be influential in pushing the company towards MBS and CDOs in the subprime mortgage market. Starting in June 2006, Senior Vice President Richard M. Bowen III ,
11934-701: Was created in the wake of the financial crisis as part of Citi's restructuring plan. It consists of several business entities including remaining interests in local consumer lending such as OneMain Financial, divestitures such as Smith Barney, and a special asset pool. Citi Holdings represents $ 156 billion of GAAP assets, or ~8% of Citigroup; 59% represents North American mortgages, 18% operating businesses, 13% special asset pool, and 10% categorized as other. Operating businesses include OneMain Financial ($ 10B), PrimeRe ($ 7B), MSSB JV ($ 8B) and Spain / Greece retail ($ 4B), less associated loan loss reserves. While Citi Holdings
12051-420: Was described as struggling, and by November they were insolvent, despite their receipt of $ 25 billion (~$ 34.7 billion in 2023) in taxpayer-funded federal Troubled Asset Relief Program funds. On November 17, 2008, Citigroup announced plans for about 52,000 new job cuts, on top of 23,000 cuts already made during 2008 in a huge job cull resulting from four-quarters of consecutive losses and reports that it
12168-1100: Was designed to stop corporate raiders from using loss corporations to evade taxes and was never intended to address the unprecedented situation where the government owned shares in banks. And it was certainly not written to prevent the government from selling its shares for a profit." In 2011, Citi was the first bank to introduce digitized Smart Banking branches in Washington, D.C., New York, Tokyo and Busan (South Korea) while it continued renovating its entire branch network. New sales and service centers were also opened in Moscow and St. Petersburg. Citi Express modules, 24-hour service units, were introduced in Colombia. Citi opened additional branches in China, expanding its branch presence to 13 cities in China. Citi Branded Cards introduced several new products in 2011, including: Citi ThankYou, Citi Executive/ AAdvantage and Citi Simplicity cards in
12285-408: Was focused on fixed-income and institutional clients, whereas Smith Barney was strong in equities and retail. Salomon Brothers absorbed Smith Barney into the new securities unit termed Salomon Smith Barney; a year later, the division incorporated Citicorp's former securities operations as well. The Salomon Smith Barney name was abandoned in October 2003 after a series of financial scandals that tarnished
12402-473: Was headed by Weill until 1985 —and merged it with Smith Barney. In November 1997, Travelers Group (which had been renamed again in April 1995 when they merged with Aetna Property and Casualty, Inc.), acquired Salomon Brothers , a major bond dealer and bulge bracket investment bank , in a $ 9 billion (~$ 15.9 billion in 2023) transaction. This deal complemented Travelers/ Smith Barney well as Salomon
12519-677: Was neither a part of the Abraham Accords . Saudi Arabia was warned by Kushner that it could lose the opportunities in Israel to its neighbors who signed the accords, including the UAE and Bahrain. Through Kushner's firm, Saudi could open to Israeli businesses, which could prove to be lucrative for the Arab country. Affinity Partner's investment in Israeli startups was agreed to by Saudi officials and
12636-645: Was no longer required at the bank. The Financial Crisis Inquiry Commission asked him to testify about Citigroup's role in the mortgage crisis, and he did so, appearing as one of the first witnesses before the Commission in April 2010. As the crisis began to unfold, Citigroup announced on April 11, 2007, that it would eliminate 17,000 jobs, or about 5% of its workforce, in a broad restructuring designed to cut costs and bolster its long underperforming stock. Even after securities and brokerage firm Bear Stearns ran into serious trouble in summer 2007, Citigroup decided
12753-481: Was part of President Donald Trump 's official trip to Saudi Arabia, PIF announced plans to "invest $ 40 billion in infrastructure projects, mostly in the U.S." Blackstone, whose CEO and founder— Stephen A. Schwarzman —is a top supporter of Trump, entered into a non-binding memorandum by which the PIF committed $ 20 billion to the project. During the CEO Forum US-Saudi, arms deals were announced including
12870-491: Was partially attributed to the fact that PIF had started to build a dedicated ESG (Environmental, Social, and Sustainability) team. The fund achieved an annual return of around 8% between 2018 and 2022. The PIF has 38% stake in Posco Engineering & Construction Co., a 5% stake in Uber (for $ 3.5 billion), and a 5% stake in the video game companies Capcom and Nexon (for $ 1 billion). In March 2016, it
12987-519: Was prompted by the insurance unit's drag on Citigroup stock price because Travelers earnings were more seasonal and vulnerable to large disasters and events such as the September 11 attacks . It was also difficult to sell insurance directly to its customers since most customers were accustomed to purchasing insurance through a broker. Travelers merged with The St. Paul Companies Inc. in 2004 forming The St. Paul Travelers Companies. Citigroup retained
13104-426: Was replaced as head of CitiMortgage with Jane Fraser , former head of Citi Private Bank. The company failed the stress tests again in 2014, this time due to qualitative concerns. However, it passed the stress tests in 2015 and in 2016. In February 2016, the company was subject to a $ 1.1 billion fraud lawsuit filed by lender Rabobank and other investors as a result of the bankruptcy of Oceanografia SA,
13221-419: Was replaced by Travelers Co. Smith Barney, Citi's global private wealth management unit, provided brokerage, investment banking and asset management services to corporations, governments and individuals around the world. With over 800 offices worldwide, Smith Barney held 9.6 million domestic client accounts, representing $ 1.562 trillion in client assets worldwide. On January 13, 2009, Citi announced
13338-403: Was then the largest foreign buyout ever of a Japanese company. Citigroup attempted to buy out the remaining shares of Nikko later that year at a cost of $ 4.6 billion to take full control of the company. Two years later, Citigroup sold its stake to Sumitomo Trust and Banking Co, a subsidiary of Sumitomo Mitsui Trust Holdings , for $ 795 million as it retreated from Japan. By July 2008 Citigroup
13455-543: Was thus the first to establish such a scheme, to fund public education. The Permanent School Fund (PSF) was created in 1854 to benefit primary and secondary schools, with the Permanent University Fund (PUF) following in 1876 to benefit universities. The PUF was endowed with public lands, the ownership of which the state retained by terms of the 1845 annexation treaty between the Republic of Texas and
13572-448: Was unlikely to be in profit again before 2010. The same day on Wall Street markets responded, with shares falling and dropping the company's market capitalization to $ 6 billion, down from $ 300 billion two years prior. Eventually staff cuts totaled over 100,000 employees. Its stock market value dropped to $ 20.5 billion, down from $ 244 billion two years earlier. Shares of Citigroup common stock traded well below $ 1.00 on
13689-804: Was widely criticized for predatory lending practices and Citi eventually settled with the Federal Trade Commission by agreeing to pay $ 240 million to customers who had been victims of a variety of predatory practices, including "flipping" mortgages, "packing" mortgages with optional credit insurance, and deceptive marketing practices. In 2001, Citigroup made additional acquisitions: European American Bank , in July, for $ 1.9 billion, and Banamex in August, for $ 12.5 billion. The company spun off its Travelers Property and Casualty insurance underwriting business in 2002. The spin-off
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