UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 20172018
Commission file number 1-9924
Citigroup Inc.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
 
52-1568099
(I.R.S. Employer Identification No.)
388 Greenwich Street, New York, NY
(Address of principal executive offices)
 
10013
(Zip code)
(212) 559-1000
(Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x    No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x  No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer x
 
Accelerated filer o
 
Non-accelerated filer o
 (Do not check if a smaller reporting company)
 
Smaller reporting company o
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes o    
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No x
Number of shares of Citigroup Inc. common stock outstanding on September 30, 2017: 2,644,001,9992018: 2,442,136,813

Available on the web at www.citigroup.com
 







CITIGROUP’S THIRD QUARTER 2017—2018—FORM 10-Q
OVERVIEW
21
MANAGEMENT'S DISCUSSION AND
  ANALYSIS OF FINANCIAL CONDITION AND
  RESULTS OF OPERATIONS
43
Executive Summary
43
Summary of Selected Financial Data
76
SEGMENT AND BUSINESS—INCOME (LOSS)
  AND REVENUES
98
SEGMENT BALANCE SHEET
119
Global Consumer Banking (GCB)
1310
North America GCB
1512
Latin America GCB
1714
Asia GCB
1916
Institutional Clients Group
2118
Corporate/Other
2623
OFF-BALANCE SHEET
  ARRANGEMENTS
2724
CAPITAL RESOURCES
2825
MANAGING GLOBAL RISK TABLE OF
  CONTENTS
4638
MANAGING GLOBAL RISK
4739
INCOME TAXES
8776
FUTURE APPLICATION OF ACCOUNTING
  STANDARDS
77
DISCLOSURE CONTROLS AND
  PROCEDURES
8878
DISCLOSURE PURSUANT TO SECTION 219 OF
  THE IRAN THREAT REDUCTION AND SYRIA
  HUMAN RIGHTS ACT
8878
FORWARD-LOOKING STATEMENTS
8979
FINANCIAL STATEMENTS AND NOTES
  TABLE OF CONTENTS
9281
CONSOLIDATED FINANCIAL STATEMENTS
9382
NOTES TO CONSOLIDATED FINANCIAL
  STATEMENTS (UNAUDITED)
10190
UNREGISTERED SALES OF EQUITY SECURITIES,
  PURCHASES OF EQUITY SECURITIES AND
  DIVIDENDS
212206



OVERVIEW

This Quarterly Report on Form 10-Q should be read in conjunction with Citigroup’s Annual Report on Form 10-K for the year ended December 31, 2016, including the historical audited consolidated financial statements of Citigroup reflecting certain reclassifications set forth in Citigroup’s Current Report on Form 8-K filed with the SEC on June 16, 2017 (2016(2017 Annual Report on Form 10-K), and Citigroup’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 20172018 (First Quarter of 20172018 Form 10-Q) and June 30, 20172018 (Second Quarter of 20172018 Form 10-Q).
Additional information about Citigroup is available on Citi’s website at www.citigroup.com. Citigroup’s annual reports on Form 10-K, quarterly reports on Form 10-Q and proxy statements, as well as other filings with the U.S. Securities and Exchange Commission (SEC), are available free of charge through Citi’s website by clicking on the “Investors” page and selecting “All SEC Filings.” The SEC’s website also contains current reports on Form 8-K, and other information regarding Citi at www.sec.gov.
Certain reclassifications, including a realignment of certain businesses, have been made to the prior periods’ financial statements and disclosures to conform to the current period’s presentation. For additional information on certain recent reclassifications, see Notes 1 and 3 to the Consolidated Financial Statements below and Notes 1 and 3 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
Throughout this report, “Citigroup,” “Citi” and “the Company” refer to Citigroup Inc. and its consolidated subsidiaries.




Citigroup is managed pursuant to two business segments: Global Consumer Banking and Institutional Clients Group, with the following segments:remaining operations in Corporate/Other.
citisegmentsa20.jpgcitisegmentsq318.jpg
The following are the four regions in which Citigroup operates. The regional results are fully reflected in the segment results above.
citigroupregionsa07.jpgcitiregions18q1.jpg

(1)
Latin America GCB consists of Citi’s consumer banking businessin Mexico.
(2)
Asia GCB includes the results of operations of GCB activities in certain EMEA countries for all periods presented.
(2)(3)
North AmericAmericaa includes the U.S., Canada and Puerto Rico, Latin America includes Mexico and Asia includes Japan.


MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

EXECUTIVE SUMMARY

Third Quarter of 2017—Balanced Growth Across Citi’s Franchise2018—Solid Operating Results and Continued Momentum
As described further throughout this Executive Summary, Citi reported balancedsolid operating results in the third quarter of 2017,2018, reflecting continued momentum across businesses and geographies, notablyincluding in many of thosethe areas where Citi has been making ongoing investments.
During the third quarter of 2018, Citi had solid revenue growth across treasury and loan growthtrade solutions, fixed income markets, securities services and the private bank in both Global Consumer Banking (GCB) and the Institutional Clients Group (ICG) compared to the prior-year quarter, while continuing to wind-down legacy assetsand in international Global Consumer Banking (GCB), with particular strength in Corporate/Other.Latin America GCB. Results duringin the current quarter and prior-year period also included a $580 million pretax ($355 million after-tax) gainreflected the impact of gains on the sale of a fixed income analytics business, which was includedbusinesses in ICG’s results.
North AmericaGCB and generatedLatin America GCB (see “Citigroup” below). During the quarter, Citi continued to demonstrate expense and credit discipline, resulting in positive operating leverage driven by revenueand an improvement in pretax earnings. Citi also had broad-based loan growth in retail bankingGCB and Citi retail servicesICG, as well as strong expense discipline. deposit growth.North America GCB’s results also included higher cost of credit, largely reflecting volume growth, seasoning and additional cards-related loan loss reserve builds. International GCB generated positive operating leverage driven by year-over-year revenue growth in both Latin America and Asia GCB, excluding the impact of foreign currency translation into U.S. dollars for reporting purposes (FX translation). ICG had a strong quarter with revenue growth across all Banking businesses, as well as in equity markets and securities services, partially offset by a decline in fixed income markets revenues. These increases in revenues were partially offset by lower revenues in Corporate/Other,mostlyreflecting the
In addition, Citi continued wind-down of legacy non-core assets.
Citi’s regulatoryto return capital declined slightly duringto its shareholders. In the quarter, as earnings growth was more than offset by the return of approximatelyCiti returned $6.4 billion to its common shareholders in the form of common stock repurchases and dividends. Citi repurchased approximately 8175 million common shares during the quarter and over 200 million over the last 12 months, resulting in the third quarter of 2017, asan 8% reduction in outstanding common shares declined 3% from the prior quarter and 7% from the prior-year period. Despite thisthe continued progress in returning capital return,to shareholders during the quarter, each of Citigroup’sCiti’s key regulatory capital metrics remained strong as of the end of the third quarter of 2017 (see “Capital” below). Citi utilized approximately $300 million of deferred tax assets (DTAs) during the quarter and $1.2 billion of its DTAs during the first nine months of 2017.
While global economic growth has continued and the macroeconomic environment remains largely positive, there continuescontinue to be various economic, political and other risks and uncertainties that could impact Citi’s businesses and future results. For a more detailed discussion of thesethe risks and uncertainties that could impact Citi’s businesses, results of operations and financial condition during the remainder of 2018, see each respective business’s results of operations and “Forward-Looking Statements” below, as well as each respective business’s results of operations and the “Managing Global Risk” and “Risk Factors” sections in Citi’s 20162017 Annual Report on Form 10-K.



Third Quarter of 20172018 Summary Results

Citigroup
Citigroup reported net income of $4.1$4.6 billion, or $1.42$1.73 per share, compared to $3.8net income of $4.1 billion, or $1.24$1.42 per share, in the prior-year period. The 8%12% increase in net income includedwas primarily driven by a lower effective tax rate due to the gain on sale, which contributed $0.13 to earnings per share. Excludingimpact of the gain, net income declined 2%Tax Cuts and Jobs Act (Tax Reform), reflecting higherand also reflected lower expenses and lower cost of credit, while earningscredit. Earnings per share increased 4%, largely22% due to a 7%the growth in net income and the 8% reduction in average shares outstanding. (Citi’s results of operations excludingoutstanding driven by the gain on sale are non-GAAP financial measures.)common stock repurchases.
Citigroup revenues of $18.2$18.4 billion in the third quarter of 20172018 were largely unchanged from the prior-year period, primarily reflecting the net impact of a gain on sale (approximately $580 million) of a fixed income analytics business in ICG in the prior-year period and a gain on sale (approximately $250 million) of an asset management business in Latin America GCB in the current quarter as well as the impact of foreign currency translation (which increased 2%, drivenreported revenues in the prior-year period by $335 million). Excluding the gaingains on sale as well as 3% aggregatethe impact of foreign currency translation in U.S. dollars for reporting purposes (FX translation), revenues increased 4%, driven by growth in ICG and GCB, partially offset by a 55% decrease in Corporate/Other due primarily to(Citi’s results of operations excluding the continued wind-downgains on sale as well as the impact of legacy non-core assets.FX translation are non-GAAP financial measures).
Citigroup’s end-of-period loans increased 2%3% to $653$675 billion versus the prior-year period. Excluding the impact of FX translation, Citigroup’s end-of-period loans also grew 2%4%, as 5%6% aggregate growth in ICGGCB and and 3% growth in GCBICG was partially offset by the continued wind-down of legacy assets in Corporate/Other. (Citi’s results of operations excluding the impact of FX translation are non-GAAP financial measures.) Citigroup’s end-of-period deposits increased 3%4% to $964 billion$1.0 trillion versus the prior-year period. Excluding the impact of FX translation, Citigroup’s deposits were up 2%increased 5%, primarily driven by a 3% increase8% growth in ICG deposits and a 1% increase in GCB deposits, slightly offset by a decline in Corporate/Other deposits.

Expenses
Citigroup’sCitigroup operating expenses of $10.3 billion decreased 2% to $10.2 billion1% versus the prior-year period, as the impact of higher volume-related expenses and ongoing investments werewas more than offset by efficiency savings and the wind-down of legacy assets. Year-over-year, ICGGCB operating expenses were up 5% and ICG operating expenses increased 1%, while GCBCorporate/Other operating expenses were largely unchanged and Corporate/Otheroperating expenses declined 36%.44%, all versus the prior-year period.

Cost of Credit
Citi’s total provisions for credit losses and for benefits and claims of $2.0 billion increased 15%decreased 1% from the prior-year period. The increasedecrease was primarily driven by an increaselower net loan loss reserve builds in net credit losses of $252 million, primarilyboth Citi retail services and Citi-branded cards in North America GCB, andpartially offset by a net loan loss reserve build of $194 million, compared to a net build of $176 million in the prior-year period. The net loan loss reserve build in the current quarter included roughly $100 million of loan loss reserves related to the potential impact of hurricane and earthquake events, recorded in North America GCB and Latin America GCBICG, as well as the legacy portfolio in Corporate/Otherdriven by volume growth.
Net credit losses of $1.8 billion increased 17%declined 1% versus the prior-year period. Consumer net credit losses of $1.7 billion


increased 17%, primarily driven by were largely unchanged from the Costco portfolio acquisition, episodic charge-offs in the North America GCB commercial portfolio, which were offset by related loan loss reserve releases, and overall volume growth and seasoning in cards. The increase in consumer net credit losses was partially offset by the continued wind-down of legacy assets in Corporate/Other.prior-year period. Corporate net credit losses increased 2%decreased from $43 million in the prior-year period to $43$30 million.
For additional information on Citi’s consumer and corporate credit costs and allowance for loan losses, see each respective business’s results of operations and “Credit Risk” below.

Capital
Citigroup’s Common Equity Tier 1 (CET1) Capital and Tier 1 Capital ratios, on a fully implemented basis, were 11.7% and 13.4% as of September 30, 2018, respectively, compared to


13.0% and 14.6% as of September 30, 2017, (basedboth based on the Basel III Standardized Approach for determining risk-weighted assets), respectively, comparedassets. The decline in regulatory capital ratios reflected the return of capital to 12.6% and 14.2%common shareholders, the previously disclosed approximate $6 billion reduction in CET1 Capital in the fourth quarter of 2017 due to the impact of Tax Reform as of September 30, 2016 (based on the Basel III Advanced Approaches for determiningwell as an increase in risk-weighted assets).assets, partially offset by net income. Citigroup’s Supplementary Leverage ratio as of September 30, 2017,2018, on a fully implemented basis, was 7.1%6.5%, compared to 7.4%7.1% as of September 30, 2016.2017. For additional information on Citi’s capital ratios and related components, including the impact of Citi’s DTAsTax Reform on its capital ratios, see “Capital Resources” below.

Global Consumer Banking
GCBnet income decreased 6% to $1.2of $1.6 billion increased 34%, driven primarily by lower cost of credit and a lower effective tax rate, as higher revenues were more thanwell as the gain on sale in Latin America GCB, partially offset by higher cost of credit, while operating expenses were unchanged.expenses. Operating expenses were $4.4$4.7 billion, down 1%up 5%, or 6% excluding the impact of FX translation, as higher volume-related expenses and continued investments were more than offsetdriven by ongoing efficiency savings.the timing of investment spending versus the prior-year period.
GCB revenues of $8.4$8.7 billion increased 3%2% versus the prior-year period. Excludingperiod, and 3% excluding the impact of FX translation, driven primarily by strength in Latin America GCB revenues increased 2%, driven by growth across all regions.as well as the gain on sale. North America GCB revenues increaseddecreased 1% to $5.2$5.1 billion, as higher revenues in Citi retail services and retail banking were partiallymore than offset by lower revenues in Citi-branded cards.cards and retail banking. Citi-branded cards revenues of $2.2$2.1 billion decreased 1%were down 3% versus the prior-year period, as the benefit of growth in full rate revolvinginterest-earning balances in the core portfolios was outpacedmore than offset by the continued run-offimpact of non-core portfoliosthe previously disclosed Hilton portfolio sale as well as the higher cost to fund growth in transactor and promotional balances, given higher interest rates.previously disclosed partnership terms. Citi retail servicesrevenues of $1.7 billion increased 2% versus the prior-year period, primarily reflecting continuedorganic loan growth.growth and the benefit of the L.L.Bean portfolio acquisition, partially offset by higher partner payments. Retail banking revenues of $1.4 billion increased 1%decreased 3% from the prior-year period.period to $1.3 billion. Excluding mortgage revenues, retail banking revenues of $1.2 billion were up 12%1% from the prior-year period, driven by continued growth in loansdeposit margins and assets under management, as well as a benefit from higher interest rates.investments, largely offset by lower episodic transaction activity in commercial banking.
North America GCB average deposits of $184$180 billion were unchanged versus the prior-year period,decreased 2% year-over-year, primarily driven by a reduction in money market balances, as clients transferred money to investments. North America GCB average retail loans of $56 billion grew 1% year-over-year and assets under management of $59$64 billion grew 10%9%. Average brandedCiti-branded card loans of $85$88 billion increased 8%3%, while brandedCiti-branded card purchase sales of $80$87 billion increased 10%9% versus the prior-year period. Average Citi retail services loans of $46$49 billion were up 5%,increased 7% versus the prior-year period, while
Citi retail services purchase sales of $20$22 billion were up 2%11%. For additional information on the results of operations of North America GCB for the third quarter of 2017,2018, see “Global Consumer Banking—North America GCB” below.
International GCB revenues (consisting of Latin America GCB and Asia GCB(which (which includes the results of operations in certainEMEA EMEA countries)) increased 8% to $3.2 billion, versus the prior-year period.period to $3.5 billion. Excluding the impact of FX translation, international GCB revenues increased 5%11% versus the prior-year period. On this basis, Latin America GCB revenues increased 4%26% versus the prior-year period, including the gain on sale. Excluding the gain on sale, Latin America GCB revenues increased 8%, driven by continued volume growth inacross commercial, mortgage and card loans and deposit volumes.as well as deposits. Asia GCB revenues increased 5% versus the prior-year period, driven by improvement1%, as continued growth in wealth managementdeposit, cards and cardsinsurance revenues partiallywas largely offset by lower retail lending revenues.investment revenues due to weaker market sentiment. For additional information on the results of operations of Latin America GCB and Asia GCB for the third quarter of 2017,2018, including the impact of FX translation, see “Global Consumer Banking—Latin America GCB” and “Global Consumer Banking—Asia GCB” below.
Year-over-year, international GCB average deposits of $124$127 billion increased 4%5%, average retail loans of $89$90 billion were roughly flat,increased 4%, assets under management of $100$105 billion increased 10%8%, average card loans of $24 billion increased 6%2% and card purchase sales of $25$26 billion increased 7%, all excluding the impact of FX translation.

Institutional Clients Group
ICG net income of $3.0$3.1 billionincreased 15%2%, driven primarily by higherthe lower effective tax rate, which more than offset the lower revenues includingas well as the $580 million ($355 million after-tax) gain on the sale of a fixed income analytics business, and a higher benefit from cost of credit partially offset by higherand operating expenses. ICG operating expenses increased 5%1% to $4.9$5.2 billion, as investments anddriven by an increase in compensation costs, volume-related expenses wereand investments, partially offset by efficiency savings.
ICG revenues were $9.2 billion in the third quarter of 2017, up 9%2018, down 2% from the prior-year period, driven byas a 16%1% increase in Banking revenues andwas more than offset by a 3% increase5% decrease in Markets and securities services revenues, including,reflecting the impact of the gain on sale.sale in the prior-year period. Excluding the gain on sale in the prior-year period, revenues increased 4%, driven by growth in both Markets and securities services (up 8%) and Banking (up 1%). The increase in Bankingrevenues included the impact of $48$106 million of losses on loan hedges within corporate lending, compared to losses of $218$48 million in the prior-year period.
Bankingrevenues of $4.7$4.9 billion (excluding the impact of losses on loan hedges within corporate lending) increased 11% compared to the prior-year period,2%, driven by significantsolid growth in investment banking and the private bank as well as continued solid performance in treasury and trade solutions, private bank and corporate lending.lending, partially offset by lower revenues in investment banking. Investment banking revenues of $1.2 billion increased 14%decreased 8% versus the prior-year period, as growth in advisory was more than offset by a decline in both debt and equity underwriting, reflecting continued wallet share gains across all products. Equitylower market activity. Advisory revenues increased 9% to $262 million, equity underwriting revenues increased 99%decreased 17% to $290$259 million and debt underwriting revenues increased 1%decreased 9% to $704 million while advisory revenues decreased 1% to $237$660 million, all versus the prior-year period.
Treasury and trade solutions revenues of $2.3 billion increased 4% versus the prior-year period, and 8% excluding the impact of FX translation, reflecting continued growth in


transaction volumes, loans and deposits. Private bank revenues increased 15%7% to $849 million versus the prior-year period, to $785 million, driven by growth in clients, loans investment activity and deposits,investments, as well as improved deposit spreads. Corporate lending revenues increased $233 million to $454were largely unchanged at $457 million. Excluding the impact of losses on loan hedges, corporate lending revenues increased 14% to $502 million


11% versus the prior-year period, reflectingprimarily driven by loan growth and lower hedging costs and improved loan sale activity. Treasury and trade solutions revenues increased 8% to $2.1 billion versus the prior-year period, reflecting continued volume growth and improved deposit spreads.costs.
Markets and securities services revenues increased 3% to $4.6of $4.5 billion versusdecreased 5% from the prior-year period, as a declineperiod. Excluding the gain on sale, Markets and securities services increased 8%, driven by revenue growth in both fixed income and equity markets revenues was more than offset by higher revenues in equity markets, securities services as well as the gain on sale. securities services.Fixed income markets revenues decreased 16% to $2.9of $3.2 billion versusincreased 9% from the prior-year period, primarily reflecting lower G10with contributions from both rates and currencies revenues, given low volatility in the current quarter and the comparison to higher Brexit-related activity a year ago, as well as lower activity in spread products. Equity markets revenues of $792 million increased 16% to $757 million versus1% from the prior-year period, reflecting client-led growth acrossas strength in prime finance and derivatives was largely offset by lower revenues in cash equities, derivativesreflecting a more challenging trading environment and prime finance.lower commissions. Securities services revenues of $672 million increased 12% to $599 million versus11%, and 15% excluding the prior-year period,impact of FX translation, driven by continued growth in client volumes across the custody business, along withand higher net interest revenue. For additional information on the results of operations of ICG for the third quarter of 2017,2018, see “Institutional Clients Group” below.

Corporate/Other
Corporate/Other net loss was $87$67 million in the third quarter of 2017,2018, compared to a net loss of $48$83 million in the prior-year period, reflecting lower revenues, partially offset by lower operating expenses and lower cost of credit.period. Operating expenses of $822$459 million declined 36%44% from the prior-year period, largely reflecting the wind-down of legacy assets andas well as lower legal expenses.infrastructure costs.
Corporate/Other revenues were $509$494 million, down 55%5% from the prior-year period, primarily reflecting the continued wind-down of legacy assets, divestitures and the impact of hedging activities.assets.
Corporate/Other end-of-period assets decreased 4% to $100 billion from the prior-year period, as Citi continued to wind-down legacy assets. For additional information on the results of operations of Corporate/Otherfor the third quarter of 2017,2018, see “Corporate/Other” below.










RESULTS OF OPERATIONS
SUMMARY OF SELECTED FINANCIAL DATA—PAGE 1
Citigroup Inc. and Consolidated Subsidiaries
Third Quarter Nine Months Third Quarter Nine Months 
In millions of dollars, except per-share amounts and ratios20172016% Change20172016% Change20182017% Change20182017% Change
Net interest revenue$11,442
$11,479
— %$33,464
$33,942
(1)%$11,802
$11,535
2 %$34,639
$33,748
3 %
Non-interest revenue6,731
6,281
7
20,730
18,921
10
6,587
6,884
(4)21,091
21,192
—
Revenues, net of interest expense$18,173
$17,760
2 %$54,194
$52,863
3 %$18,389
$18,419
— %$55,730
$54,940
1 %
Operating expenses10,171
10,404
(2)31,154
31,296
—
10,311
10,417
(1)31,948
31,900
—
Provisions for credit losses and for benefits and claims1,999
1,736
15
5,378
5,190
4
1,974
1,999
(1)5,643
5,378
5
Income from continuing operations before income taxes$6,003
$5,620
7 %$17,662
$16,377
8 %$6,104
$6,003
2 %$18,139
$17,662
3 %
Income taxes(1)1,866
1,733
8
5,524
4,935
12
1,471
1,866
(21)4,356
5,524
(21)
Income from continuing operations$4,137
$3,887
6 %$12,138
$11,442
6 %$4,633
$4,137
12 %$13,783
$12,138
14 %
Income (loss) from discontinued operations,
net of taxes(1)(2)
(5)(30)83
(2)(55)96
(8)(5)(60)—
(2)100
Net income before attribution of noncontrolling
interests
$4,132
$3,857
7 %$12,136
$11,387
7 %$4,625
$4,132
12 %$13,783
$12,136
14 %
Net income attributable to noncontrolling interests(1)17
NM
41
48
(15)3
(1)NM
51
41
24
Citigroup’s net income$4,133
$3,840
8 %$12,095
$11,339
7 %$4,622
$4,133
12 %$13,732
$12,095
14 %
Less: 

   

   
Preferred dividends—Basic$272
$225
21 %$893
$757
18 %$270
$272
(1)%$860
$893
(4)%
Dividends and undistributed earnings allocated to employee restricted and deferred shares that contain nonforfeitable rights to dividends, applicable to basic EPS53
53
—
156
145
8
51
53
(4)151
156
(3)
Income allocated to unrestricted common shareholders
for basic and diluted EPS
$3,808
$3,562
7 %$11,046
$10,437
6 %$4,301
$3,808
13 %$12,721
$11,046
15 %
Earnings per share 

  
  

  
 
Basic 

  
  

  
 
Income from continuing operations1.42
1.25
14
4.05
3.60
13
$1.74
$1.42
23 %$5.04
$4.05
24 %
Net income1.42
1.24
15
4.05
3.58
13
1.73
1.42
22
5.04
4.05
24
Diluted 

   

   
Income from continuing operations$1.42
$1.25
14 %$4.05
$3.60
13 %$1.74
$1.42
23 %$5.04
$4.05
24 %
Net income1.42
1.24
15
4.05
3.58
13
1.73
1.42
22
5.04
4.05
24
Dividends declared per common share0.32
0.16
100
0.64
0.26
NM
0.45
0.32
41
1.09
0.64
70

StatementTable continues on the next page, including notes to the table.footnotes.



SUMMARY OF SELECTED FINANCIAL DATA—PAGE 2
Citigroup Inc. and Consolidated Subsidiaries
Citigroup Inc. and Consolidated Subsidiaries
 Third Quarter Nine Months 
In millions of dollars, except per-share amounts, ratios and
  direct staff
20172016% Change20172016% Change
At September 30:      
Total assets$1,889,133
$1,818,117
4 %   
Total deposits964,038
940,252
3
   
Long-term debt232,673
209,051
11
   
Citigroup common stockholders’ equity208,381
212,322
(2)   
Total Citigroup stockholders’ equity227,634
231,575
(2)   
Direct staff (in thousands)
213
220
(3)   
Performance metrics  

   
Return on average assets0.87%0.83%

0.87%0.84% 
Return on average common stockholders’ equity(2)
7.3
6.8


7.2
6.7
 
Return on average total stockholders’ equity(2)
7.2
6.6


7.1
6.6
 
Efficiency ratio (Total operating expenses/Total revenues)56
59


57
59
 
Basel III ratios—full implementation      
Common Equity Tier 1 Capital(3)
12.98%12.63%    
Tier 1 Capital(3)
14.61
14.23
    
Total Capital(3)
16.95
16.34
    
Supplementary Leverage ratio(4)
7.11
7.40
    
Citigroup common stockholders’ equity to assets11.03%11.68% 

  
Total Citigroup stockholders’ equity to assets12.05
12.74
 

  
Dividend payout ratio(5)
22.5
12.9
 15.8%7.3% 
Total payout ratio(6)
165
83
 96
56
 
Book value per common share$78.81
$74.51
6 %

  
Tangible book value (TBV) per share(7)
68.55
64.71
6
   
Ratio of earnings to fixed charges and preferred stock dividends2.27x
2.61x
 2.34x
2.60x
 
 Third Quarter Nine Months 
In millions of dollars, except per-share amounts, ratios and direct staff20182017% Change20182017% Change
At September 30:      
Total assets$1,925,165
$1,889,133
2 %   
Total deposits1,005,176
964,038
4
   
Long-term debt235,270
232,673
1
   
Citigroup common stockholders’ equity(1)
177,969
208,381
(15)   
Total Citigroup stockholders’ equity(1)
197,004
227,634
(13)   
Direct staff (in thousands)
206
213
(3)   
Performance metrics  

   
Return on average assets0.95%0.87%

0.96%0.87% 
Return on average common stockholders’ equity(1)(3)
9.6
7.3


9.5
7.2
 
Return on average total stockholders’ equity(1)(3)
9.2
7.2


9.2
7.1
 
Efficiency ratio (total operating expenses/total revenues)56.1
56.6


57.3
58.1
 
Basel III ratios—full implementation(1)(4)
      
Common Equity Tier 1 Capital(5)
11.73%12.98%    
Tier 1 Capital(5)
13.36
14.61
    
Total Capital(5)
15.98
16.95
    
Supplementary Leverage ratio6.50
7.11
    
Citigroup common stockholders’ equity to assets(1)
9.24%11.03% 

  
Total Citigroup stockholders’ equity to assets(1)
10.23
12.05
 

  
Dividend payout ratio(6)
26.0
22.5
 21.6%15.8% 
Total payout ratio(7)
147.0
164.6
 98.1
96.5
 
Book value per common share(1)
$72.88
$78.81
(8)%

  
Tangible book value (TBV) per share(1)(8)
61.91
68.55
(10)   
(1)The third quarter and nine months of 2018 reflect the impact of Tax Reform. For additional information on Tax Reform, including the impact on Citi’s fourth quarter and full-year 2017 results, see Citi’s 2017 Annual Report on Form 10-K.
(2)See Note 2 to the Consolidated Financial Statements for additional information on Citi’s discontinued operations.
(2)(3)The return on average common stockholders’ equity is calculated using net income less preferred stock dividends divided by average common stockholders’ equity. The return on average total Citigroup stockholders’ equity is calculated using net income divided by average Citigroup stockholders’ equity.
(3)(4)Citi’s risk-based capital and leverage ratios as of September 30, 2017 are non-GAAP financial measures, which reflect full implementation of regulatory capital adjustments and deductions prior to the effective date of January 1, 2018.
(5)Citi’s reportable Common Equity Tier 1 (CET1) Capital and Tier 1 Capital ratios were the lower derived under the U.S. Basel III Standardized Approach at September 30, 2017, and U.S. Basel III Advanced Approaches at September 30, 2016. Citi’s reportable Total Capital ratios were derived under the U.S. Basel III Advanced Approaches for both periods presented. This reflects the U.S. Basel III requirement to report the lower of risk-based capital ratios under both the Standardized Approach and Advanced Approaches in accordance with the Collins Amendment of the Dodd-Frank Act.
(4)Citi’s Supplementary Leverage ratio reflects full implementation of the U.S. Basel III rules.
(5)(6)Dividends declared per common share as a percentage of net income per diluted share.
(6)(7)Total common dividends declared plus common stock repurchases as a percentage of net income available to common shareholders. See “Consolidated Statement of Changes in Stockholders’ Equity,” Note 9 to the Consolidated Financial Statements and “Equity Security Repurchases” below for the component details.
(7)(8)For information on TBV, see “Capital Resources—Tangible Common Equity, Book Value Per Share, Tangible Book Value Per Share and Returns on Equity” below.
NM Not meaningful




SEGMENT AND BUSINESS—INCOME (LOSS) AND REVENUES
CITIGROUP INCOME
Third Quarter Nine Months Third Quarter Nine Months 
In millions of dollars20172016% Change20172016% Change20182017% Change20182017% Change
Income from continuing operations         
Global Consumer Banking         
North America$655
$780
(16)%$1,952
$2,428
(20)%$850
$642
32 %$2,407
$1,913
26 %
Latin America164
160
3
430
479
(10)334
169
98
717
445
61
Asia(1)
355
310
15
924
822
12
383
359
7
1,116
938
19
Total$1,174
$1,250
(6)%$3,306
$3,729
(11)%$1,567
$1,170
34 %$4,240
$3,296
29 %
Institutional Clients Group

 



 



 



 

North America$1,322
$1,067
24 %$3,534
$2,618
35 %$870
$1,298
(33)%$2,755
$3,463
(20)%
EMEA746
649
15
2,380
1,718
39
972
753
29
3,072
2,401
28
Latin America380
389
(2)1,188
1,111
7
541
388
39
1,546
1,211
28
Asia614
555
11
1,751
1,697
3
734
623
18
2,310
1,778
30
Total$3,062
$2,660
15 %$8,853
$7,144
24 %$3,117
$3,062
2 %$9,683
$8,853
9 %
Corporate/Other(99)(23)NM
(21)569
NM
(51)(95)46
(140)(11)NM
Income from continuing operations$4,137
$3,887
6 %$12,138
$11,442
6 %$4,633
$4,137
12 %$13,783
$12,138
14 %
Discontinued operations$(5)$(30)83 %$(2)$(55)96 %$(8)$(5)(60)%$—
$(2)100 %
Net income attributable to noncontrolling interests(1)17
NM
41
48
(15)3
(1)NM
51
41
24
Citigroup’s net income$4,133
$3,840
8 %$12,095
$11,339
7 %$4,622
$4,133
12 %$13,732
$12,095
14 %

(1)
Asia GCB includes the results of operations of GCB activities in certain EMEA countries for all periods presented.
NM Not meaningful



CITIGROUP REVENUES
Third Quarter Nine Months Third Quarter Nine Months 
In millions of dollars20172016% Change20172016% Change20182017% Change20182017% Change
Global Consumer Banking         
North America$5,194
$5,161
1 %$15,082
$14,700
3 %$5,129
$5,197
(1)%$15,290
$15,088
1 %
Latin America1,370
1,245
10
3,811
3,710
3
1,670
1,388
20
4,398
3,863
14
Asia(1)
1,869
1,758
6
5,392
5,142
5
1,855
1,885
(2)5,649
5,438
4
Total$8,433
$8,164
3 %$24,285
$23,552
3 %$8,654
$8,470
2 %$25,337
$24,389
4 %
Institutional Clients Group

 

 



 

  

North America$3,638
$3,191
14 %$10,661
$9,564
11 %$3,329
$3,709
(10)%$10,105
$10,877
(7)%
EMEA2,655
2,506
6
8,299
7,250
14
2,927
2,703
8
9,137
8,438
8
Latin America1,059
999
6
3,228
2,983
8
1,055
1,099
(4)3,427
3,354
2
Asia1,879
1,763
7
5,382
5,246
3
1,930
1,919
1
6,111
5,501
11
Total$9,231
$8,459
9 %$27,570
$25,043
10 %$9,241
$9,430
(2)%$28,780
$28,170
2 %
Corporate/Other509
1,137
(55)2,339
4,268
(45)494
519
(5)1,613
2,381
(32)
Total Citigroup net revenues$18,173
$17,760
2 %$54,194
$52,863
3 %$18,389
$18,419
— %$55,730
$54,940
1 %
(1)
Asia GCB includes the results of operations of GCB activities in certain EMEA countries for all periods presented.





SEGMENT BALANCE SHEET(1) 
In millions of dollars
Global
Consumer
Banking
Institutional
Clients
Group
Corporate/Other
and
consolidating
eliminations(2)
Citigroup
Parent company-
issued long-term
debt and
stockholders’
equity(3)
Total
Citigroup
consolidated
Global
Consumer
Banking
Institutional
Clients
Group
Corporate/Other
and
consolidating
eliminations(2)
Citigroup
parent company-
issued long-term
debt and
stockholders’
equity(3)
Total
Citigroup
consolidated
Assets      
Cash and deposits with banks$9,963
$64,994
$111,152
$—
$186,109
$10,034
$66,084
$123,168
$—
$199,286
Federal funds sold and securities
borrowed or purchased under
agreements to resell
327
251,787
494
—
252,608
Federal funds sold and securities
borrowed and purchased under
agreements to resell
157
280,556
228
—
280,941
Trading account assets6,366
250,104
2,437
—
258,907
754
249,904
6,844
—
257,502
Investments10,143
110,627
233,904
—
354,674
1,271
108,942
235,300
—
345,513
Loans, net of unearned income and
allowance for loan losses

291,785
325,055
23,977
—
640,817
299,493
347,050
16,030
—
662,573
Other assets38,306
101,387
56,325
—
196,018
37,605
105,200
36,545
—
179,350
Liquidity assets(4)
62,265
266,523
(328,788)—
—
Net inter-segment liquid assets(4)
77,370
246,754
(324,124)—
—
Total assets$419,155
$1,370,477
$99,501
$—
$1,889,133
$426,684
$1,404,490
$93,991
$—
$1,925,165
Liabilities and equity      
Total deposits$310,048
$639,554
$14,436
$—
$964,038
$310,689
$684,623
$9,864
$—
$1,005,176
Federal funds purchased and
securities loaned or sold under
agreements to repurchase
4,199
157,076
7
—
161,282
Federal funds purchased and
securities loaned and sold under
agreements to repurchase
3,054
172,851
10
—
175,915
Trading account liabilities9
138,253
558
—
138,820
141
147,115
396
—
147,652
Short-term borrowings798
20,806
16,545
—
38,149
473
22,798
10,499
—
33,770
Long-term debt(3)
1,109
35,498
44,152
151,914
232,673
1,831
41,351
43,905
148,183
235,270
Other liabilities19,377
86,477
19,695
—
125,549
19,613
94,913
14,993
—
129,519
Net inter-segment funding (lending)(3)
83,615
292,813
3,120
(379,548)—
90,883
240,839
13,465
(345,187)—
Total liabilities$419,155
$1,370,477
$98,513
$(227,634)$1,660,511
$426,684
$1,404,490
$93,132
$(197,004)$1,727,302
Total equity(5)
—
—
988
227,634
228,622
Total stockholders’ equity(5)
—
—
859
197,004
197,863
Total liabilities and equity$419,155
$1,370,477
$99,501
$—
$1,889,133
$426,684
$1,404,490
$93,991
$—
$1,925,165

(1)The supplemental information presented in the table above reflects Citigroup’s consolidated GAAP balance sheet by reporting segment as of September 30, 2017.2018. The respective segment information depicts the assets and liabilities managed by each segment as of such date.
(2)
Consolidating eliminations for total Citigroup and Citigroup parent company assets and liabilities are recorded within Corporate/Other.
(3)The total stockholders’ equity and the majority of long-term debt of Citigroup reside in the Citigroup parent company Consolidated Balance Sheet. Citigroup allocates stockholders’ equity and long-term debt to its businesses through inter-segment allocations as shown above.
(4)Represents the attribution of Citigroup’s liquidityliquid assets (primarily consisting of cash, marketable equity securities, and available-for-sale debt securities) to the various businesses based on Liquidity Coverage Ratio (LCR) assumptions.
(5)
Corporate/OtheOtherr equity represents noncontrolling interests.





































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GLOBAL CONSUMER BANKING
Global Consumer Banking (GCB) consists of consumer banking businesses in North America, Latin America (consisting of Citi’s consumer banking business in Mexico) and Asia. GCB provides traditional banking services to retail customers through retail banking, including commercial banking, and Citi-branded cards and Citi retail services (for additional information on these businesses, see “Citigroup Segments” above)above and “Managing Global Risk—Consumer Credit” below). GCB is focused on its priority markets in the U.S., Mexico and Asia with 2,4742,417 branches in 19 countries and jurisdictions as of September 30, 2017.2018. At September 30, 2017,2018, GCB had approximately $419$427 billion in assets and $310$311 billion in deposits.
GCB’s overall strategy is to leverage Citi’s global footprint and be the preeminentpre-eminent bank for the emerging affluent and affluent consumers in large urban centers. In credit cards and in certain retail markets (including commercial banking), Citi serves customers in a somewhat broader set of segments and geographies.

Third Quarter Nine Months Third Quarter Nine Months 
In millions of dollars except as otherwise noted20172016% Change20172016% Change20182017% Change20182017% Change
Net interest revenue$7,010
$6,709
4 %$20,231
$19,369
4 %$7,236
$7,071
2 %$21,235
$20,410
4 %
Non-interest revenue1,423
1,455
(2)%4,054
4,183
(3)%1,418
1,399
1
4,102
3,979
3
Total revenues, net of interest expense$8,433
$8,164
3 %$24,285
$23,552
3 %$8,654
$8,470
2 %$25,337
$24,389
4 %
Total operating expenses$4,410
$4,429
— %$13,322
$13,127
1 %$4,661
$4,452
5 %$13,997
$13,440
4 %
Net credit losses$1,704
$1,349
26 %$4,922
$4,094
20 %$1,714
$1,704
1 %$5,176
$4,922
5 %
Credit reserve build (release)486
436
11 %788
544
45 %186
486
(62)484
788
(39)
Provision (release) for unfunded lending commitments(5)(3)(67)%—
6
(100)%6
(5)NM
8
—
NM
Provision for benefits and claims28
26
8 %80
74
8 %27
28
(4)75
80
(6)
Provisions for credit losses and for benefits and claims (LLR & PBC)$2,213
$1,808
22 %$5,790
$4,718
23 %$1,933
$2,213
(13)%$5,743
$5,790
(1)%
Income from continuing operations before taxes$1,810
$1,927
(6)%$5,173
$5,707
(9)%$2,060
$1,805
14 %$5,597
$5,159
8 %
Income taxes636
677
(6)1,867
1,978
(6)493
635
(22)1,357
1,863
(27)
Income from continuing operations$1,174
$1,250
(6)%$3,306
$3,729
(11)%$1,567
$1,170
34 %$4,240
$3,296
29 %
Noncontrolling interests2
3
(33)%7
6
17
1
2
(50)4
7
(43)
Net income$1,172
$1,247
(6)%$3,299
$3,723
(11)%$1,566
$1,168
34 %$4,236
$3,289
29 %
Balance Sheet data (in billions of dollars)


 

 



 

  

Total EOP assets$419
$411
2 % 

$427
$419
2 %  

Average assets421
409
3
$415
$391
6 %424
421
1
$421
$415
1 %
Return on average assets1.10%1.21%

1.06%1.27%

1.47%1.10%

1.35%1.06%

Efficiency ratio52%54%

55%56%

54
53


55
55


Average deposits$308
$301
2 %$306
$298
3 %$307
$308
—
$307
$306
—
Net credit losses as a percentage of average loans2.26%1.87%

2.24%1.97%

2.22%2.26%

2.27%2.24%

Revenue by business

 

 



 

  

Retail banking$3,493
$3,330
5 %$9,947
$9,759
2 %$3,717
$3,521
6 %$10,677
$10,024
7 %
Cards(1)
4,940
4,834
2
14,338
13,793
4
4,937
4,949
—
14,660
14,365
2
Total$8,433
$8,164
3 %$24,285
$23,552
3 %$8,654
$8,470
2 %$25,337
$24,389
4 %
Income from continuing operations by business

 

 



 

  

Retail banking$550
$461
19 %$1,309
$1,231
6 %$666
$546
22 %$1,770
$1,298
36 %
Cards(1)
624
789
(21)1,997
2,498
(20)901
624
44
2,470
1,998
24
Total$1,174
$1,250
(6)%$3,306
$3,729
(11)%$1,567
$1,170
34 %$4,240
$3,296
29 %
Table continues on the next page.page, including footnotes.



Foreign currency (FX) translation impact 

   

   
Total revenue—as reported$8,433
$8,164
3 %$24,285
$23,552
3 %$8,654
$8,470
2 %$25,337
$24,389
4 %
Impact of FX translation(2)
—
89


—
(39)

—
(106)

—
(11)

Total revenues—ex-FX(3)
$8,433
$8,253
2 %$24,285
$23,513
3 %$8,654
$8,364
3 %$25,337
$24,378
4 %
Total operating expenses—as reported$4,410
$4,429
— %$13,322
$13,127
1 %$4,661
$4,452
5 %$13,997
$13,440
4 %
Impact of FX translation(2)
—
43


—
(10)

—
(53)

—
15


Total operating expenses—ex-FX(3)
$4,410
$4,472
(1)%$13,322
$13,117
2 %$4,661
$4,399
6 %$13,997
$13,455
4 %
Total provisions for LLR & PBC—as reported$2,213
$1,808
22 %$5,790
$4,718
23 %$1,933
$2,213
(13)%$5,743
$5,790
(1)%
Impact of FX translation(2)
—
20


—
(20)

—
(23)

—
(12)

Total provisions for LLR & PBC—ex-FX(3)
$2,213
$1,828
21 %$5,790
$4,698
23 %$1,933
$2,190
(12)%$5,743
$5,778
(1)%
Net income—as reported$1,172
$1,247
(6)%$3,299
$3,723
(11)%$1,566
$1,168
34 %$4,236
$3,289
29 %
Impact of FX translation(2)
—
17


—
(10)

—
(18)

—
(9)

Net income—ex-FX(3)
$1,172
$1,264
(7)%$3,299
$3,713
(11)%$1,566
$1,150
36 %$4,236
$3,280
29 %
(1)Includes both Citi-branded cards and Citi retail services.
(2)Reflects the impact of FX translation into U.S. dollars at the third quarter of 20172018 and year-to-date 20172018 average exchange rates for all periods presented.
(3)Presentation of this metric excluding FX translation is a non-GAAP financial measure.

NM Not meaningful



NORTH AMERICA GCB
North America GCB provides traditional retail banking, including commercial banking, and its Citi-branded cards and Citi retail services card products to retail customers and small-small to mid-size businesses, as applicable, in the U.S. North America GCB’s U.S. cards product portfolio includes its proprietary portfolio (including the Citi Double Cash, Thank You and Value cards) and co-branded cards (including, among others, American Airlines and Costco) within Citi-branded cards as well as its co-brand and private label relationships (including, among others, Sears, The Home Depot, Macy’sBest Buy and Best Buy)Macy’s) within Citi retail services.
As previously announced, the Hilton Honors co-brand credit card partnership with Citi was scheduled to terminate as of year-end 2017. On October 23, 2017, Citi signed an agreement to sell the Hilton credit card portfolio ($1.2 billion in outstanding loan balances in Citi-branded cards) to American Express. In connection with the sale agreement, the existing partnership was extended through the closing date. The sale is expected to close in the first quarter of 2018 with a pretax gain of approximately $150 million, which approximates one year of revenues from the portfolio.
As of September 30, 2017,2018, North America GCB’s 695692 retail bank branches are concentrated in the six key metropolitan areas of New York, Chicago, Miami, Washington, D.C., Los Angeles and San Francisco. Also as of September 30, 2017,2018, North America GCB had approximately 9.49.0 million retail banking customer accounts, $55.7$56.3 billion in retail banking loans and $185.1$181.9 billion in deposits. In addition, North America GCB had approximately 120120.2 million Citi-branded and Citi retail services credit card accounts with $132.2$137.8 billion in outstanding card loan balances.balances, including the newly acquired $1.5 billion L.L.Bean portfolio.

Third Quarter Nine Months Third Quarter Nine Months 
In millions of dollars, except as otherwise noted20172016% Change20172016% Change20182017% Change20182017% Change
Net interest revenue$4,825
$4,696
3 %$14,075
$13,425
5 %$4,984
$4,825
3 %$14,514
$14,074
3 %
Non-interest revenue369
465
(21)1,007
1,275
(21)145
372
(61)776
1,014
(23)
Total revenues, net of interest expense$5,194
$5,161
1 %$15,082
$14,700
3 %$5,129
$5,197
(1)%$15,290
$15,088
1 %
Total operating expenses$2,460
$2,595
(5)%$7,613
$7,521
1 %$2,668
$2,482
7 %$7,979
$7,677
4 %
Net credit losses$1,239
$927
34 %$3,610
$2,814
28 %$1,242
$1,239
— %$3,816
$3,610
6 %
Credit reserve build (release)463
408
13 %716
536
34
116
463
(75)354
716
(51)
Provision for unfunded lending commitments(3)—
NM
6
7
(14)
Provisions for benefits and claims9
8
13 %23
25
(8)
Provision (release) for unfunded lending commitments5
(3)NM
3
6
(50)
Provision for benefits and claims5
9
(44)16
23
(30)
Provisions for credit losses and for benefits and claims$1,708
$1,343
27 %$4,355
$3,382
29 %$1,368
$1,708
(20)%$4,189
$4,355
(4)%
Income from continuing operations before taxes$1,026
$1,223
(16)%$3,114
$3,797
(18)%$1,093
$1,007
9 %$3,122
$3,056
2 %
Income taxes371
443
(16)1,162
1,369
(15)243
365
(33)715
1,143
(37)
Income from continuing operations$655
$780
(16)%$1,952
$2,428
(20)%$850
$642
32 %$2,407
$1,913
26 %
Noncontrolling interests—
—
NM
—
(1)100 %—
—
—
—
—
—
Net income$655
$780
(16)%$1,952
$2,429
(20)%$850
$642
32 %$2,407
$1,913
26 %
Balance Sheet data (in billions of dollars)


 

  




 

 
 


Average assets$249
$239
4 %$246
$223
10 %$249
$250
— %$247
$246
— %
Return on average assets1.04%1.30%

1.06%1.45%

1.35%1.02%

1.30%1.04%

Efficiency ratio47%50%

50%51%

52
48


52
51


Average deposits$184.1
$183.9
—
$184.9
$182.2
1 %$180.2
$184.1
(2)$180.3
$184.6
(2)
Net credit losses as a percentage of average loans2.63%2.07%

2.62%2.24%

2.56%2.63%

2.68%2.62%

Revenue by business

 

  




 

 
 


Retail banking$1,363
$1,356
1 %$3,910
$3,959
(1)%$1,329
$1,366
(3)%$3,984
$3,916
2 %
Citi-branded cards2,178
2,191
(1)6,353
5,937
7
2,108
2,178
(3)6,402
6,353
1
Citi retail services1,653
1,614
2
4,819
4,804
—
1,692
1,653
2
4,904
4,819
2
Total$5,194
$5,161
1 %$15,082
$14,700
3 %$5,129
$5,197
(1)%$15,290
$15,088
1 %
Income from continuing operations by business

 

  




 

 
 


Retail banking$179
$187
(4)%$402
$448
(10)%$131
$169
(22)%$432
$371
16 %
Citi-branded cards345
322
7
898
995
(10)375
342
10
1,109
890
25
Citi retail services131
271
(52)652
985
(34)344
131
NM
866
652
33
Total$655
$780
(16)%$1,952
$2,428
(20)%$850
$642
32 %$2,407
$1,913
26 %

NM Not meaningful


3Q173Q18 vs. 3Q163Q17
Net income decreased 16%increased 32%, due to higherlower cost of credit and a lower effective tax rate due to the impact of Tax Reform, partially offset by lower expensesrevenues and higher revenues.expenses.
Revenues increaseddecreased 1%, reflectingas higher revenues in Citi retail services and retail banking, partiallywere more than offset by lower revenues in Citi-branded cards.cards and retail banking.
Retail banking revenues increased 1%decreased 3%. Excluding mortgage revenues (decline of 39%28%), retail banking revenues were up 12%1%, driven by continued growth in average loans (1%),deposit margins and asset under management (10%),investments, largely offset by lower episodic transaction activity in commercial banking as well as increasing
rate sensitivity. Average deposits decreased 2% year-over-year, primarily driven by a benefit from higher interest rates.reduction in money market balances, as clients transferred money to investments. Assets under management were up 9%. The decline in mortgage revenues was driven by lower origination activity and higher cost of funds, reflecting the higher interest rate environment, as well as the impact of the previously announced sale of a portion of Citi’s mortgage servicing rights.environment.
Cards revenues decreased 1%. In Citi-branded cards, revenues decreased 1%3%, as the benefit of growth in full-rate revolvinginterest-earning balances in the core portfolios was outpacedmore than offset by the continued run-offimpact of non-core portfoliosthe Hilton portfolio sale as well as the higher cost to fund growthpreviously disclosed partnership terms that went into effect earlier in transactor and promotional balances, given the higher interest rates.2018. Average loans grew 8%increased 3% and purchase sales grew 10%increased 9%.
Citi retail services revenues increased 2%, primarily reflecting continuedorganic loan growth and the benefit of the L.L.Bean portfolio acquisition, partially offset by the continued impact of the previously disclosed renewal and extension of certain partnerships within the portfolio.higher partner payments. Average loans grew 5%increased 7% and purchase sales grew 2%increased 11%.
Expenses decreased 5%increased 7%, as higher volume-related expensesdriven by volume growth and continued investments were more than offset by efficiency savings.
the timing of investment spending versus the prior-year period.
Provisions increased 27%decreased 20% from the prior-year period, driven by higher net credit losses and a higherlower net loan loss reserve build.
Net credit losses increased 34%, largely driven by higher losses in Citi-branded cards, including the impact of acquiring the Costco portfolio, and Citi retail services. In Citi-branded cards, net credit losses increased 36% to $611 million, primarily due to the Costco portfolio acquisition, organic volume growth and seasoning. In Citi retail services, net credit losses increased 26% to $540 million, primarily due to volume growth and seasoning. The higher net credit losses also reflected episodic charge-offs in the commercial portfolio in retail banking, which were offset by related reserve releases.
The net loan loss reserve build in the thirdcurrent quarter of 2017 was $460$121 million, (comparedprimarily due to volume growth in both cards portfolios. This compares to a build of $408$460 million in the prior-year period), driven by a build of approximately $500 million related to the cards businesses, partially offset by a reserve release in the commercial portfolio. The loan loss reserve buildperiod, which included approximately $300 million related to thean increase in net flow rates in the later delinquency buckets leading to higher inherent credit loss expectations primarily in Citi retail services as well asand a slight increase in delinquencies for the Citi-branded cardcards portfolio. It also includes approximately $150 million
Net credit losses were largely unchanged at $1.2 billion, driven by higher net credit losses in Citi-branded cards (up 5% to $644 million) and Citi retail services (up 5% to $566 million), offset by a $56 million decrease in retail banking, driven by episodic charge-offs in the commercial portfolio in the prior-year period. The increase in the cards net credit losses primarily reflected volume growth and seasoning as well as approximately $50 million for the estimated hurricane-related impacts.in both portfolios.
For additional information on North America GCB’s retail banking, including commercial banking, and its Citi-branded cards and Citi retail services portfolios, see “Credit Risk—Consumer Credit” below.
As part of its Citi retail services business, Citi issues co-brand and private label credit card products with Sears. As has been widely reported, on October 15, 2018, Sears filed for Chapter 11 bankruptcy protection that includes, among other things, plans to close additional stores. The impact to Citi retail services, including on revenues due to reduced new
 
account acquisitions or lower purchase sales, will depend, among other things, on the magnitude and timing of the Sears store closures. Citi retail services could also incur additional costs related to customer communications, including to support spending activity on the predominantly general-purpose MasterCard portfolio. Citi does not currently expect the Chapter 11 filing to have an immediate or ongoing material impact on its consolidated results. For additional information, see “Forward-Looking Statements” below and “Risk-Factors—Strategic Risks” in Citi’s 2017 Annual Report on Form 10-K.
2018 YTD vs. 20162017 YTD
Year-to-date, North America GCB has experienced similar trends to those described above. Net income decreased 20%increased 26%, driven by higher revenues, a lower effective tax rate due to higherthe impact of Tax Reform and lower cost of credit, and higher expenses, partially offset by higher revenues.expenses.
Revenues increased 3%1%, reflecting higher revenues in cards, partially offset by lower revenues inacross retail banking.banking, Citi retail services and Citi-branded cards. Retail banking revenues decreased 1%increased 2%. Excluding mortgage revenues (decline of 24%), retail banking revenues increased 6%, driven by lower mortgage revenues, partially offset by the other factors described above.growth in deposit margins and investments. Cards revenues increased 4%1%. In Citi-branded cards, revenues increased 7%,1% driven by the impact of the Costco portfolio acquisition, partially offset by the othersame factors described above. Citi retail services revenues were largely unchanged, as the continued impact of the renewal and extension of certain partnerships,above, as well as the absencesale of gains on salesthe Hilton portfolio, which resulted in a gain of two cards portfoliosapproximately $150 million in the first quarter of 2016, were2018. This gain was largely offset by the continued loan growth (average loans up 4%).loss of operating revenues from the portfolio. Citi retail services revenues increased 2%, driven by the same factors described above.
Expenses increased 1%4%, primarily driven by the addition of the Costco portfolio, volume-related expenses and continued investments,same factors described above, partially offset by efficiency savings.
Provisions decreased 4%. Net credit losses increased 29%6%, driven by volume growth and seasoning in both cards portfolios. This increase was more than offset by a 51% decline in the net loan loss reserve build, driven by the same factors described above. Net credit losses increased 28% and the net loan loss reserve build of $722 million increased $179 million.








LATIN AMERICA GCB
Latin America GCB provides traditional retail banking, including commercial banking, and its Citi-branded card products to retail customers and small-small to mid-size businesses in Mexico through Citibanamex, one of Mexico’s largest banks.
At September 30, 2017,2018, Latin America GCB had 1,4971,463 retail branches in Mexico, with approximately 27.629.1 million retail banking customer accounts, $21.0 billion in retail banking loans and $28.3$30.1 billion in deposits. In addition, the business had approximately 5.7 million Citi-branded card accounts with $5.6$5.8 billion in outstanding loan balances.

Third Quarter Nine Months% ChangeThird Quarter Nine Months% Change
In millions of dollars, except as otherwise noted20172016% Change2017201620182017% Change20182017
Net interest revenue$985
$877
12 %$2,702
$2,591
4 %$1,042
$1,038
— %$3,052
$2,853
7 %
Non-interest revenue(1)385
368
5 %1,109
1,119
(1)%628
350
79
1,346
1,010
33
Total revenues, net of interest expense$1,370
$1,245
10 %$3,811
$3,710
3 %$1,670
$1,388
20 %$4,398
$3,863
14 %
Total operating expenses$768
$707
9 %$2,162
$2,150
1 %$828
$779
6 %$2,369
$2,191
8 %
Net credit losses$295
$254
16 %$825
$792
4 %$307
$295
4 %$863
$825
5 %
Credit reserve build (release)44
32
38 %106
47
NM
Credit reserve build31
44
(30)106
106
—
Provision (release) for unfunded lending commitments(1)—
NM
(2)2
NM
—
(1)100
1
(2)NM
Provision for benefits and claims19
18
6 %57
49
16 %22
19
16
59
57
4
Provisions for credit losses and for benefits and claims (LLR & PBC)$357
$304
17 %$986
$890
11 %$360
$357
1 %$1,029
$986
4 %
Income from continuing operations before taxes$245
$234
5 %$663
$670
(1)%$482
$252
91 %$1,000
$686
46 %
Income taxes81
74
9
233
191
22
148
83
78
283
241
17
Income from continuing operations$164
$160
3 %$430
$479
(10)%$334
$169
98 %$717
$445
61 %
Noncontrolling interests1
2
(50)4
4
—
—
1
(100)—
4
(100)
Net income$163
$158
3 %$426
$475
(10)%$334
$168
99 %$717
$441
63 %
Balance Sheet data (in billions of dollars)


 

  




 

 
 


Average assets$47
$49
(4)%$45
$50
(10)%$45
$47
(4)%$44
$45
(2)%
Return on average assets1.38%1.28%

1.27%1.27%

2.94%1.42%

2.18%1.31%

Efficiency ratio56%57%

57%58%

50
56


54
57


Average deposits$28.8
$25.7
12 %$27.3
$25.9
5 %$29.4
$28.8
2
$28.9
$27.3
6
Net credit losses as a percentage of average loans4.37%4.18%

4.39%4.35%

4.63%4.37%

4.44%4.39%

Revenue by business

 

 



 

  

Retail banking$976
$881
11 %$2,735
$2,590
6 %$1,265
$992
28 %$3,230
$2,781
16 %
Citi-branded cards394
364
8
1,076
1,120
(4)405
396
2
1,168
1,082
8
Total$1,370
$1,245
10 %$3,811
$3,710
3 %$1,670
$1,388
20 %$4,398
$3,863
14 %
Income from continuing operations by business

 

  




 

 
 


Retail banking$125
$84
49 %$298
$270
10 %$279
$129
NM
$572
$310
85 %
Citi-branded cards39
76
(49)132
209
(37)55
40
38 %145
135
7
Total$164
$160
3 %$430
$479
(10)%$334
$169
98 %$717
$445
61 %


FX translation impact

 

  




 

  


Total revenues—as reported$1,370
$1,245
10 %$3,811
$3,710
3 %$1,670
$1,388
20 %$4,398
$3,863
14 %
Impact of FX translation(1)
—
71


—
(92)

Impact of FX translation(2)
—
(66)

—
(45)

Total revenues—ex-FX(2)(3)
$1,370
$1,316
4 %$3,811
$3,618
5 %$1,670
$1,322
26 %$4,398
$3,818
15 %
Total operating expenses—as reported$768
$707
9 %$2,162
$2,150
1 %$828
$779
6 %$2,369
$2,191
8 %
Impact of FX translation(1)
—
33


—
(43)

Impact of FX translation(2)
—
(31)

—
(21)

Total operating expenses—ex-FX(2)(3)
$768
$740
4 %$2,162
$2,107
3 %$828
$748
11 %$2,369
$2,170
9 %
Provisions for LLR & PBC—as reported$357
$304
17 %$986
$890
11 %$360
$357
1 %$1,029
$986
4 %
Impact of FX translation(1)
—
18


—
(23)

Impact of FX translation(2)
—
(17)

—
(12)

Provisions for LLR & PBC—ex-FX(2)(3)
$357
$322
11 %$986
$867
14 %$360
$340
6 %$1,029
$974
6 %
Net income—as reported$163
$158
3 %$426
$475
(10)%$334
$168
99 %$717
$441
63 %
Impact of FX translation(1)
—
13


—
(20)

Impact of FX translation(2)
—
(11)

—
(9)

Net income—ex-FX(2)(3)
$163
$171
(5)%$426
$455
(6)%$334
$157
NM
$717
$432
66 %
(1)Third quarter of 2018 includes an approximate $250 million gain on the sale of an asset management business. See Note 2 to the Consolidated Financial Statements.
(2)Reflects the impact of FX translation into U.S. dollars at the third quarter of 20172018 and year-to-date 20172018 average exchange rates for all periods presented.
(2)(3)Presentation of this metric excluding FX translation is a non-GAAP financial measure.
NM Not meaningful

The discussion of the results of operations for Latin America GCB below excludes the impact of FX translation for all periods presented. Presentations of the results of operations, excluding the impact of FX translation, are non-GAAP financial measures. For a reconciliation of certain of these metrics to the reported results, see the table above.

3Q173Q18 vs. 3Q163Q17
Net income decreased 5%, primarily driven byincreased $177 million to $334 million, reflecting higher credit costsrevenues and expenses,a lower effective tax rate as a result of Tax Reform, partially offset by higher revenues.expenses and cost of credit.
Revenues increased 4%26%, including the gain on sale of an asset management business (approximately $250 million). For additional information, see Note 2 to the Consolidated Financial Statements. Excluding the gain on sale, revenueswere up 8%, driven by higher revenuesincreases in
both retail banking and cards.
Retail banking revenues increased 5%34%. Excluding the gain on sale, retail banking revenues increased 8%, reflectingdriven by continued growth in volumes, including an increase in average loans (6%), largely driven by theacross commercial and small business portfoliosmortgage loans and deposits, as well as mortgages, an increase in average deposits (7%) and improved deposit spreads driven bydue to higher interest rates. WhileAverage loans grew 4%, average deposits continued to increase during the quarter, Latin America GCB was impacted by lower industry-wide deposit growth due to a slowing of growth in the monetary supply.grew 8% and assets under management grew 5%. Cards revenues increased 2%7%, due to continued volume growth, reflecting continued improvement in full ratehigher purchase sales (up 14%) and full-rate revolving loan trends, partially offset by continued higher cost to fund non-revolving loans. Purchase salesAverage cards loans grew 5% and average card loans also grew 5%6%.
Expenses increased 4%11%, asdriven by volume growth, ongoing investment spending and business growth werehigher repositioning charges, partially offset by efficiency savings.
Provisions increased 11%6%, primarily driven byas higher net credit losses (9%) andwere partially offset by a higherlower net loan loss reserve build ($10 million), largely reflecting volume growth, seasonality andbuild. The net credit loss increase primarily reflected an episodic commercial charge-off that was fully offset by a Mexico earthquake-relatedrelated loan loss reserve build (approximately $25 million).release.
For additional information on Latin America GCB’s retail banking, including commercial banking, and its Citi-branded cards portfolios, see “Credit Risk—Consumer Credit” below.


 
2017
2018 YTD vs. 20162017 YTD
Year-to-date, Latin America GCB has experienced similar trends to those described above. Net income decreased 6%increased 66%, driven by the same factors described above.
Revenues increased 5%15%, primarily due toincluding the gain on sale in the third quarter of 2018. Excluding the gain on sale, revenues increased 9%, reflecting higher revenues in both retail banking partially offset by lower revenues inand cards. Retail banking revenues increased 8%, driven by the same factors described above as well as the impact of business divestitures.above. Cards revenues decreased 1%, driven by the continued higher cost to fund non-revolving loans, partially offset by the continued improvement in full rate revolving loans.
Expensesincreased 3%9%, as ongoing investment spending was partially offset by efficiency savings.
Provisions increased 14%, largely driven by the same factors described above.
Expenses increased 9%, driven by the same factors described above.
Provisions increased 6%, driven by higher net credit losses and a higher net loan loss reserve build, primarily due to volume growth and seasoning in cards. The increase in net credit losses also reflected the episodic commercial charge-off that was fully offset by a related loan loss reserve release.





ASIA GCB
Asia GCB provides traditional retail banking, including commercial banking, and its Citi-branded card products to retail customers and small-small to mid-size businesses, as applicable. During the third quarter of 2017, Citi’s2018, Asia GCB’s most significant revenues in the region Asia were from Singapore, Hong Kong, Korea, India, Australia, India, Taiwan, Indonesia, Thailand, Philippines, Indonesia and Malaysia. Included within Asia GCB, traditional retail banking and Citi-branded card products are also provided to retail customers in certain EMEA countries, primarily in Poland, Russia and the United Arab Emirates.
At September 30, 2017,2018, on a combined basis, the businesses had 282262 retail branches, approximately 16.215.9 million retail banking customer accounts, $67.5$69.5 billion in retail banking loans and $96.6$98.7 billion in deposits. In addition, the businesses had approximately 16.615.4 million Citi-branded card accounts with $18.8$18.6 billion in outstanding loan balances.

Third Quarter Nine Months% ChangeThird Quarter Nine Months% Change
In millions of dollars, except as otherwise noted (1)
20172016% Change2017201620182017% Change20182017
Net interest revenue$1,200
$1,136
6 %$3,454
$3,353
3 %$1,210
$1,208
— %$3,669
$3,483
5 %
Non-interest revenue669
622
8
1,938
1,789
8
645
677
(5)1,980
1,955
1
Total revenues, net of interest expense$1,869
$1,758
6 %$5,392
$5,142
5 %$1,855
$1,885
(2)%$5,649
$5,438
4 %
Total operating expenses$1,182
$1,127
5 %$3,547
$3,456
3 %$1,165
$1,191
(2)%$3,649
$3,572
2 %
Net credit losses$170
$168
1 %$487
$488
— %$165
$170
(3)%$497
$487
2 %
Credit reserve build (release)(21)(4)NM
(34)(39)13
39
(21)NM
24
(34)NM
Provision (release) for unfunded lending commitments(1)(3)67
(4)(3)(33)1
(1)NM
4
(4)NM
Provisions for credit losses$148
$161
(8)%$449
$446
1 %$205
$148
39 %$525
$449
17 %
Income from continuing operations before taxes$539
$470
15 %$1,396
$1,240
13 %$485
$546
(11)%$1,475
$1,417
4 %
Income taxes184
160
15
472
418
13
102
187
(45)359
479
(25)
Income from continuing operations$355
$310
15 %$924
$822
12 %$383
$359
7 %$1,116
$938
19 %
Noncontrolling interests1
1
—
3
3
—
1
1
—
4
3
33
Net income$354
$309
15 %$921
$819
12 %$382
$358
7 %$1,112
$935
19 %
Balance Sheet data (in billions of dollars)






  








 
 


Average assets$125
$121
3 %$124
$119
4 %$130
$124
5 %$130
$124
5 %
Return on average assets1.12%1.02%

0.99%0.92%

1.17%1.15%

1.14%1.01%

Efficiency ratio63%64% 66%67%

63
63
 65
66


Average deposits$95.2
$91.6
4
$94.1
$89.4
5
$97.6
$95.2
3
$98.1
$94.1
4
Net credit losses as a percentage of average loans0.78%0.78%

0.77%0.77%

0.75%0.78%

0.75%0.77%

Revenue by business   

    

Retail banking$1,154
$1,093
6 %$3,302
$3,210
3 %$1,123
$1,163
(3)%$3,463
$3,327
4 %
Citi-branded cards715
665
8
2,090
1,932
8
732
722
1
2,186
2,111
4
Total$1,869
$1,758
6 %$5,392
$5,142
5 %$1,855
$1,885
(2)%$5,649
$5,438
4 %
Income from continuing operations by business





 







  

Retail banking$246
$190
29 %$609
$513
19 %$256
$248
3 %$766
$617
24 %
Citi-branded cards109
120
(9)315
309
2
127
111
14
350
321
9
Total$355
$310
15 %$924
$822
12 %$383
$359
7 %$1,116
$938
19 %


FX translation impact

 



  

Total revenues—as reported$1,869
$1,758
6 %$5,392
$5,142
5 %$1,855
$1,885
(2)%$5,649
$5,438
4 %
Impact of FX translation(2)
—
18


—
53


—
(40)

—
34


Total revenues—ex-FX(3)
$1,869
$1,776
5 %$5,392
$5,195
4 %$1,855
$1,845
1 %$5,649
$5,472
3 %
Total operating expenses—as reported$1,182
$1,127
5 %$3,547
$3,456
3 %$1,165
$1,191
(2)%$3,649
$3,572
2 %
Impact of FX translation(2)
—
10


—
33


—
(22)

—
36


Total operating expenses—ex-FX(3)
$1,182
$1,137
4 %$3,547
$3,489
2 %$1,165
$1,169
— %$3,649
$3,608
1 %
Provisions for loan losses—as reported$148
$161
(8)%$449
$446
1 %$205
$148
39 %$525
$449
17 %
Impact of FX translation(2)
—
2


—
3


—
(6)

—
—


Provisions for loan losses—ex-FX(3)
$148
$163
(9)%$449
$449
— %$205
$142
44 %$525
$449
17 %
Net income—as reported$354
$309
15 %$921
$819
12 %$382
$358
7 %$1,112
$935
19 %
Impact of FX translation(2)
—
4


—
10


—
(7)

—
—


Net income—ex-FX(3)
$354
$313
13 %$921
$829
11 %$382
$351
9 %$1,112
$935
19 %

(1)
Asia GCB includes the results of operations of GCB activities in certain EMEA countries for all periods presented.
(2)Reflects the impact of FX translation into U.S. dollars at the third quarter of 20172018 and year-to-date 20172018 average exchange rates for all periods presented.
(3)Presentation of this metric excluding FX translation is a non-GAAP financial measure.
NM Not meaningful


The discussion of the results of operations for Asia GCB below excludes the impact of FX translation for all periods presented. Presentations of the results of operations, excluding the impact of FX translation, are non-GAAP financial measures. For a reconciliation of certain of these metrics to the reported results, see the table above.

3Q173Q18 vs. 3Q163Q17
Net income increased 13%9%, reflecting higher revenues and a lower costeffective tax rate as a result of credit,Tax Reform, partially offset by higher expenses.cost of credit.
Revenues increased 5%1%, driven by improvement in wealth management andhigher cards revenues, partially offset by continued lower retail lendingbanking revenues.
Retail banking revenues increased 4%decreased 2%, primarilyas continued growth in deposit and insurance revenues was more than offset by lower investment revenues due to the continued improvement in wealth management revenues, partially offset by the repositioning of the retail loan portfolio. Wealth management revenues increased due to improvement in investor sentiment, stronger equity markets and increases inweaker market sentiment. Investment sales decreased 22%, while assets under management (14%)grew 9% and investment sales (36%). Averageaverage deposits increased 3%4%. These increases were partiallyRetail lending revenues declined 1%, as volume growth in personal and commercial loans was more than offset by the lower retail lendingmortgage revenues (down 4%), reflecting continued lower average loans (1%) due to the continued optimization of this portfolio away from lower-yielding mortgagespread compression. Average loans to focus on growing higher-return personal loans.grew 4%.
Cards revenues increased 6%4%, reflecting 6%driven by continued growth in average loans (up 2%) and 7% growth in purchase sales both of which benefited from the previously disclosed portfolio acquisition in Australia in the first quarter of 2017.(up 6%).
Expenses increased 4%, resulting from volumewere largely unchanged, as volume-driven growth and ongoing investment spending partiallywere offset by efficiency savings.
Provisions decreased 9%increased 44%, primarily driven by an increase ina net loan loss reserve releases.build compared to a net loan loss reserve release in the prior-year period. Overall credit quality continued to remain stable in the region.
For additional information on Asia GCB’s retail banking, including commercial banking, and its Citi-branded cards portfolios, see “Credit Risk—Consumer Credit” below.

 

20172018 YTD vs. 20162017 YTD
Year-to-date, Asia GCB has experienced similar trends to
those described above. Net income increased 11%19%, due to higher revenues and the lower effective tax rate, partially offset by higher expenses.expenses and a higher cost of credit.
Revenues increased 4%3%, primarily due to an increasedriven by continued momentum in cardsretail banking and cards. Retail banking revenues and wealth management revenues,increased 3%, driven by growth in deposits, partially offset by lower retail lendinginvestment and mortgage revenues. Retail banking revenues increased 2%, driven by the same factors described above. Cards revenues increased 7%, driven by the same factors described above as well as a previously disclosed modest gain in the second quarter of 2017 related to the sale of merchant acquiring businesses in certain countries.
Expenses increased 2%were up 3%, driven by the same factors described above.
Expenses increased 1%, as volume-driven growth and ongoing investment spending were partially offset by efficiency savings.
Provisions were largely unchanged, as lower net credit losses were offsetup 17%, primarily driven by lower net credit reserve releases, primarily due to a net loan loss reserve build compared to a release in the first quarter of 2017prior-year period and modestly higher net credit losses related to the card portfolio acquisition in Australia.volume growth and seasoning.











INSTITUTIONAL CLIENTS GROUP
Institutional Clients Group (ICG) includes Banking and Markets and securities services (for additional information on these businesses, see “Citigroup Segments” above). ICG provides corporate, institutional, public sector and high-net-worth clients around the world with a full range of 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. ICG transacts with clients in both cash instruments and derivatives, including fixed income, foreign currency, equity and commodity products.
ICG revenue is generated primarily from fees and spreads associated with these activities. ICG earns fee income for assisting clients inwith transactional services and clearing, transactions, providing brokerage and investment banking services and other such activities. Such fees are recognized at the point in time when Citigroup’s performance under the terms of a contractual arrangement is completed, which is typically at the trade/execution date or closing of a transaction. Revenue generated from these activities is recorded in Commissions and fees and Investment banking. Revenue is also generated from transaction processing and assets under custody and administration.administration, which is recognized as/when the associated promised service is satisfied, which normally occurs at the point in time the service is requested by the customer and provided by Citi. Revenue generated from these activities is primarily recorded in Administration and other fiduciary fees. For additional information on these various types of revenues, see Note 5 to the Consolidated Financial Statements.
In addition, as a market maker, ICG facilitates transactions, including holding product inventory to meet client demand, and earns the differential between the price at which it buys and sells the products. These price differentials and the unrealized gains and losses on the inventory are recorded in Principal transactions (for additional information on Principal transactions revenue, see Note 6 to the Consolidated Financial Statements). Other primarily includes mark-to-market gains and losses on certain credit derivatives, gains and losses on available-for-sale (AFS) debt securities, gains and losses on equity securities not held in trading accounts, and other non-recurring gains and losses. Interest income earned on assets held, less interest paid to customers on deposits and long- and short-term debt, is recorded as Net interest revenue.

The amount and types of Markets revenues are impacted by a variety of interrelated factors, including market liquidity; changes in market variables such as interest rates, foreign exchange rates, equity prices, commodity prices and credit spreads, as well as their implied volatilities; investor confidence; and other macroeconomic conditions. Assuming all other market conditions do not change, increases in client activity levels or bid/offer spreads generally result in increases in revenues. However, changes in market conditions can significantly impact client activity levels, bid/offer spreads and the fair value of product inventory. For example, a decrease in market liquidity may increase bid/offer spreads, decrease client activity levels and widen credit spreads on product inventory positions.
ICG’s management of the Markets businesses involves daily monitoring and evaluating of the above factors at the trading desk as well as the country level. ICG does not separately track the impact on total Markets revenues of the volume of transactions, bid/offer spreads, fair value changes of product inventory positions and economic hedges because, as noted above, these components are interrelated and are not deemed useful or necessary individually to manage the Markets businesses at an aggregate level.
In the Markets businesses, client revenues are those revenues directly attributable to client transactions at the time of inception, including commissions, interest or fees earned. Client revenues do not include the results of client facilitation activities (for example, holding product inventory in anticipation of client demand) or the results of certain economic hedging activities.
ICG’s international presence is supported by trading floors in approximately 80 countries and a proprietary network in 98 countries and jurisdictions. At September 30, 2017,2018, ICG had approximately $1.4 trillion of assets and $640$685 billion of deposits, while two of its businesses—securities services and issuer services—managed approximately $17.1$18.0 trillion of assets under custody compared to $15.4$17.1 trillion at the end of the prior-year period.

Third Quarter Nine Months% ChangeThird Quarter Nine Months% Change
In millions of dollars, except as otherwise noted20172016% Change2017201620182017% Change20182017
Commissions and fees$1,036
$929
12 %$3,041
$2,889
5 %$1,085
$1,100
(1)%$3,425
$3,230
6 %
Administration and other fiduciary fees710
610
16
2,073
1,845
12
686
688
—
2,093
1,997
5
Investment banking1,099
917
20
3,323
2,686
24
1,029
1,163
(12)3,260
3,516
(7)
Principal transactions1,757
2,064
(15)6,504
5,552
17
2,447
1,827
34
7,689
6,709
15
Other(1)
704
(125)NM
939
(86)NM
(18)704
NM
554
951
(42)
Total non-interest revenue$5,306
$4,395
21 %$15,880
$12,886
23 %$5,229
$5,482
(5)%$17,021
$16,403
4 %
Net interest revenue (including dividends)3,925
4,064
(3)11,690
12,157
(4)4,012
3,948
2
11,759
11,767
—
Total revenues, net of interest expense$9,231
$8,459
9 %$27,570
$25,043
10 %$9,241
$9,430
(2)%$28,780
$28,170
2 %
Total operating expenses$4,939
$4,687
5 %$14,903
$14,322
4 %$5,191
$5,138
1 %$16,152
$15,503
4 %
Net credit losses$44
$45
(2)%$140
$397
(65)%$23
$44
(48)%$127
$140
(9)%
Credit reserve build (release)(38)(93)59
(229)(11)NM
7
(38)NM
(136)(229)41
Provision (release) for unfunded lending commitments(170)(42)NM
(193)(4)NM
41
(170)NM
64
(193)NM
Provisions for credit losses$(164)$(90)(82)%$(282)$382
NM
$71
$(164)NM
$55
$(282)NM
Income from continuing operations before taxes$4,456
$3,862
15 %$12,949
$10,339
25 %$3,979
$4,456
(11)%$12,573
$12,949
(3)%
Income taxes1,394
1,202
16
4,096
3,195
28
862
1,394
(38)2,890
4,096
(29)
Income from continuing operations$3,062
$2,660
15 %$8,853
$7,144
24 %$3,117
$3,062
2 %$9,683
$8,853
9 %
Noncontrolling interests14
19
(26)47
46
2
(6)14
NM
21
47
(55)
Net income$3,048
$2,641
15 %$8,806
$7,098
24 %$3,123
$3,048
2 %$9,662
$8,806
10 %
EOP assets (in billions of dollars)
$1,370
$1,303
5 %  $1,404
$1,370
2 %   
Average assets (in billions of dollars)
1,369
1,310
5
$1,349
$1,294
4 %1,402
1,369
2
$1,399
$1,349
4 %
Return on average assets0.88%0.80%

0.87%0.73%

0.88%0.88%

0.92%0.87%

Efficiency ratio54
55


54
57


56
54


56
55


Revenues by region 

 

 

  

North America$3,638
$3,191
14 %$10,661
$9,564
11 %$3,329
$3,709
(10)%$10,105
$10,877
(7)%
EMEA2,655
2,506
6
8,299
7,250
14
2,927
2,703
8
9,137
8,438
8
Latin America1,059
999
6
3,228
2,983
8
1,055
1,099
(4)3,427
3,354
2
Asia1,879
1,763
7
5,382
5,246
3
1,930
1,919
1
6,111
5,501
11
Total$9,231
$8,459
9 %$27,570
$25,043
10 %$9,241
$9,430
(2)%$28,780
$28,170
2 %
Income from continuing operations by region 

  


 

  


North America$1,322
$1,067
24 %$3,534
$2,618
35 %$870
$1,298
(33)%$2,755
$3,463
(20)%
EMEA746
649
15
2,380
1,718
39
972
753
29
3,072
2,401
28
Latin America380
389
(2)1,188
1,111
7
541
388
39
1,546
1,211
28
Asia614
555
11
1,751
1,697
3
734
623
18
2,310
1,778
30
Total$3,062
$2,660
15 %$8,853
$7,144
24 %$3,117
$3,062
2 %$9,683
$8,853
9 %
Average loans by region (in billions of dollars)
 

  


 

  


North America$152
$145
5 %$149
$142
5 %$166
$152
9 %$164
$149
10 %
EMEA71
68
4
68
66
3
82
71
15
80
68
18
Latin America34
36
(6)34
36
(6)33
34
(3)33
34
(3)
Asia64
58
10
61
58
5
65
64
2
67
61
10
Total$321
$307
5 %$312
$302
3 %$346
$321
8 %$344
$312
10 %
EOP deposits by business (in billions of dollars)
   

    

Treasury and trade solutions$428
$417
3 % 

$470
$428
10 %  

All other ICG businesses
212
202
5






215
212
1






Total$640
$619
3 %





$685
$640
7 %






(1)Third quarter of 2017 includes thean approximate $580 million gain on the sale of a fixed income analytics business. First quarter of 2016 includes a charge of approximately $180 million, primarily reflecting the write-down of Citi’s net investment in Venezuela as a result of changes in the exchange rate during the quarter.
NM Not meaningful


ICG Revenue Details—Excluding Gains (Losses) on Loan Hedges
Third Quarter Nine Months% ChangeThird Quarter Nine Months% Change
In millions of dollars20172016% Change2017201620182017% Change20182017
Investment banking revenue details
         
Advisory$237
$239
(1)%$797
$704
13 %$262
$240
9 %$838
$807
4 %
Equity underwriting290
146
99
820
438
87
259
311
(17)810
870
(7)
Debt underwriting704
698
1
2,314
2,029
14
660
729
(9)2,085
2,400
(13)
Total investment banking$1,231
$1,083
14 %$3,931
$3,171
24 %$1,181
$1,280
(8)%$3,733
$4,077
(8)%
Treasury and trade solutions2,144
1,986
8
6,284
5,888
7
2,283
2,185
4
6,887
6,399
8
Corporate lending—excluding gains/(losses) on loan hedges(1)
502
439
14
1,413
1,270
11
Corporate lending—excluding gains (losses) on loan hedges(1)
563
506
11
1,673
1,425
17
Private bank785
680
15
2,317
2,038
14
849
790
7
2,601
2,332
12
Total banking revenues (ex-gains/(losses) on loan hedges)$4,662
$4,188
11 %$13,945
$12,367
13 %
Corporate lending—gains/(losses) on loan hedges(1)
$(48)$(218)78 %$(154)$(487)68 %
Total banking revenues (including gains/(losses) on loan hedges)$4,614
$3,970
16 %$13,791
$11,880
16 %
Total banking revenues (ex-gains (losses) on loan hedges)$4,876
$4,761
2 %$14,894
$14,233
5 %
Corporate lending—gains (losses) on loan hedges(1)
$(106)$(48)NM
$(60)$(154)61 %
Total banking revenues (including gains (losses) on loan hedges), net of interest expense$4,770
$4,713
1 %$14,834
$14,079
5 %
Fixed income markets$2,877
$3,413
(16)%$9,714
$9,896
(2)%$3,199
$2,936
9 %$9,693
$9,888
(2)%
Equity markets757
654
16
2,217
2,127
4
792
785
1
2,759
2,312
19
Securities services599
533
12
1,726
1,623
6
672
608
11
1,978
1,754
13
Other(2)
384
(111)NM
122
(483)NM
(192)388
NM
(484)137
NM
Total markets and securities services revenues$4,617
$4,489
3 %$13,779
$13,163
5 %
Total markets and securities services revenues, net of interest expense$4,471
$4,717
(5)%$13,946
$14,091
(1)%
Total revenues, net of interest expense$9,231
$8,459
9 %$27,570
$25,043
10 %$9,241
$9,430
(2)%$28,780
$28,170
2 %
Commissions and fees$167
$115
45 %$461
$352
31 %$165
$171
(4)%$523
$471
11 %
Principal transactions(3)
1,546
1,825
(15)5,754
4,934
17
2,020
1,592
27
6,312
5,887
7
Other129
171
(25)459
600
(24)84
130
(35)388
464
(16)
Total non-interest revenue$1,842
$2,111
(13)%$6,674
$5,886
13 %$2,269
$1,893
20 %$7,223
$6,822
6 %
Net interest revenue1,035
1,302
(21)3,040
4,010
(24)930
1,043
(11)2,470
3,066
(19)
Total fixed income markets$2,877
$3,413
(16)%$9,714
$9,896
(2)%$3,199
$2,936
9 %$9,693
$9,888
(2)%
Rates and currencies$2,161
$2,362
(9)%$6,891
$7,059
(2)%$2,347
$2,189
7 %$7,052
$6,973
1 %
Spread products / other fixed income716
1,051
(32)2,823
2,837
—
Spread products/other fixed income852
747
14
2,641
2,915
(9)
Total fixed income markets$2,877
$3,413
(16)%$9,714
$9,896
(2)%$3,199
$2,936
9 %$9,693
$9,888
(2)%
Commissions and fees$301
$302
— %$930
$978
(5)%$284
$309
(8)%$953
$958
(1)%
Principal transactions(3)
190
45
NM
331
48
NM
284
211
35
922
399
NM
Other(5)4
NM
(4)133
NM
(3)(5)40
97
(2)NM
Total non-interest revenue$486
$351
38 %$1,257
$1,159
8 %$565
$515
10 %$1,972
$1,355
46 %
Net interest revenue271
303
(11)960
968
(1)227
270
(16)787
957
(18)
Total equity markets$757
$654
16 %$2,217
$2,127
4 %$792
$785
1 %$2,759
$2,312
19 %

(1)Credit derivatives are used to economically hedge a portion of the corporate loan portfolio that includes both accrual loans and loans at fair value. Gains/Gains (losses) on loan hedges includesinclude the mark-to-market on the credit derivatives and the mark-to-market on the loans in the portfolio that are at fair value. The fixed premium costs of these hedges are netted against the corporate lending revenues to reflect the cost of credit protection. Citigroup’s results of operations excluding the impact of gains/gains (losses) on loan hedges are non-GAAP financial measures.
(2)Third quarter of 2017 includes thean approximate $580 million gain on the sale of a fixed income analytics business. First quarter of 2016 includes the charge of approximately $180 million, primarily reflecting the write-down of Citi’s net investment in Venezuela as a result of changes in the exchange rate during the quarter.
(3)
(3) Excludes principal transactions revenues of ICG businesses other than Markets, primarily treasury and trade solutions and the private bank.
NM Not meaningful



3Q18 vs. 3Q17
Net income increased 2%, driven primarily by a lower effective tax rate due to Tax Reform, which more than offset lower revenues, higher cost of credit and expenses.

Revenues decreased 2%, as a 1% increase in Banking revenues was more than offset by a 5% decrease in Markets and securities services, reflecting the impact of
the approximate $580 million gain on sale of a fixed income analytics business in the prior-year period. Excluding the gain on sale in the prior-year period, revenues were up 4%, driven by higher revenues in both Banking and Markets and securities services. The increase in Banking revenues was driven by improved performance in treasury and trade solutions and the private bank.
NM Not meaningful




3Q17 vs. 3Q16
Net income increased 15%, driven by higher revenues, including the $580 million gain on the sale of a fixed income analytics business, and a higher benefit from cost of credit,bank, partially offset by higher operating expenses.

Revenues increased 9%, reflecting higher revenuesa decline in Banking (increase of 16%; increase of 11% excluding lossesinvestment banking. Excluding the gain on loan hedges) and higher revenues insale, Markets and securities services (increase of 3%), including the gain on sale (decrease of 10% excluding the gain on sale). Bankingrevenues wereincreased 8%, driven by continued strong momentum and performance across all businesses. Citi expectshigher revenues in ICG will likely continue to reflect the overall market environment, including a normal seasonal decline in thefixed income markets businesses in the fourth quarter of 2017.and securities services.

Within Banking:

Investment banking revenues increased 14%declined 8%, driven by continued wallet share gains across products, partially offset by a declinedrop in overall market wallet from the prior-year period.across all major products. Advisory revenues declined 1%, largely reflecting the decline in overall market wallet. Equity underwriting revenues increased 99%9%, reflecting significant wallet share gains and particular strengthstrong performance in North America and EMEA. Equity underwriting revenues decreased 17%, driven by lower market wallet as well as a decline in market share. Debt underwriting revenues increased 1%decreased 9%, reflecting the wallet share gains, partially offset bydue to the decline in overall market wallet.wallet despite gaining market share.
Treasury and trade solutions revenues increased 8%4%. Excluding the impact of FX translation, revenues increased 7%8%, primarily reflecting strength in all regions. Revenue growth in the cash business was primarily driven by continued growth in deposit balances and improved deposit spreads, as well as higher transaction volumes from both new and existing clients. Trade revenues were largely unchanged, as loan growth was offset by the tightening of loan spreads and lower episodic fees. Average deposit balances increased 7% (8% excluding the impact of FX translation), with strong growth in deposits across all regions. Average loans increased 3% (4% excluding the impact of FX translation), driven by EMEA and AsiaLatin America. The increase in revenues reflects continued growth in loans and deposits along with improvements in deposit spreads, as well as fee growth driven by higher payment, clearing and commercial card volumes and episodic fees in trade.End-of-period deposit balances increased 3% (2% excluding the impact of FX translation). Average trade loans increased 4%, driven by strong loan growth in Asia and EMEA.
Corporate lendingrevenues increased $233of $457 million to $454 million.were largely unchanged. Excluding the impact of losses on loan hedges, revenues increased 14%. The increase in revenues was11%, driven by lower hedging costscost and improvedhigher loan sale activity.volumes. Average loans declined 1%.increased 8% versus the prior-year period.
Private bank revenues increased 15%, reflecting strength across all products, largely driven by North America and Asia. The increase in revenues was due to growth in clients, higher loan and deposit volumes, higher deposit spreads, higher managed investments revenues and increased capital markets activity.

Within Markets and securities services:

Fixed income markets revenues decreased 16%7%, driven by North America and EMEA, primarily due to lower client activityreflecting higher deposit spreads, an increase in the current quarterloans and the strong trading environment in the prior-year period. The decline in revenues was driven by lower net interest revenue (down 21%), largely due to a change in the mix of trading positions in support of client activity and lower principal transactions revenues (down 15%) reflecting the lower client activity and the prior-year strength in the trading environment. Rates and currencies revenues decreased 9%, driven by lower G10 rates and currencieshigher managed investments revenues due to the low volatility in the current quarter and the comparison to higher revenues in the prior-year period following the vote in the U.K. in favor of its withdrawal from the European Union. Local markets rates and currencies revenues increased modestly, reflecting continued corporatestrong client engagement across the global network. Spread products and other fixed income revenues decreased 32%, primarily driven by the prior-year strength in the trading environment in securitized markets in North America, as well as lower credit products and municipals revenues.activity.
Equity markets revenues increased 16%, driven mainly by client-led growth, reflecting strength across regions. The increase in revenues was primarily due to higher equity derivatives revenues due to higher client activity and a more favorable trading environment compared to the prior-year period. The increase was also driven by continued momentum in cash equities and higher balances in prime finance. Principal transactions revenues increased, reflecting the client-led growth.
Securities services revenues increased 12%, reflecting particular strength in Asia and EMEA. The increase in revenues was driven by growth in fee revenues due to continued growth in assets under custody and increased client volumes, as well as growth in net interest revenue driven by higher interest rates.

Expenses increased 5% as investments, volume-related expenses and higher legal and related expenses were partially offset by efficiency savings.
Provisions decreased 82%, driven by a net loan loss reserve release of $208 million (compared to a $135 million release in the prior-year period, largely related to energy and energy-related exposures). The primary driver of the current quarter’s release was an improvement in the provision for unfunded lending commitments in the corporate loan portfolio.



2017 YTD vs. 2016 YTD
Net income increased 24%, primarily driven by higher revenues and lower credit costs, partially offset by higher expenses.

Revenues increased 10%, reflecting higher revenues in Banking (increase of 16%; increase of 13% excluding the impact of losses on loan hedges) and higher revenues in Markets and securities services (increase of 5%), including the gain on sale (unchanged excluding the gain on sale).

Within Banking:

Investment banking revenues increased 24%, largely reflecting gains in wallet share across products as well as an improvement from the industry-wide slowdown in activity levels during the first half of 2016, particularly in equity underwriting. Advisory revenues increased 13%, reflecting the wallet share gains. Equity underwriting revenues increased 87%, driven by significant wallet share gains as well as the increase in overall market activity. Debt underwriting revenues increased 14%, primarily driven by the wallet share gains.
Treasury and trade solutions revenues increased 7%, primarily driven by continued growth in deposit and loan volumes, higher spreads and strong fee growth across most cash products, as well as a modest improvement in trade revenues.
Corporate lending revenues increased 61%. Excluding the impact of losses on loan hedges, revenues increased 11%, driven by lower hedging costs in the current period, improved loan sale activity and the prior-period adjustment to the residual value of a lease financing.
Private bank revenues increased 14%, reflecting strength across all regions, primarily driven by increased loan and deposit growth, higher deposit spreads and higher
managed investments revenues.

Within Markets and securities services:

Fixed income markets revenues decreased 2%increased 9%, due to lowerdriven by higher revenues in North America,Latin America, and Asia, partially offset by growth in EMEA. Rates and currenciesNorth America. The increase in revenues decreased 2%was largely due to lower G10higher non-interest revenue (an increase of 20%) in rates and
currencies revenues reflecting low volatility this year and the comparison to Brexit-led activity in the prior-year period. Spreadas well as spread products and other fixed income, revenues remained unchanged. Netpartially offset by lower net interest revenue, was lower (down 24%), largely due tomainly reflecting a change in the mix of trading positions in support of client activity as well as higher funding costs, given the higher interest rate environment. The increase in non-interest revenues was driven by higher principal transaction revenues (increase of 27%), primarily in rates and currencies, reflecting higher client activity and facilitation gains.
Rates and currencies revenues increased 7%, driven by higher G10 rates and G10 FX revenues in all regions, reflecting strength in corporate client activity, as well as benefiting from a continuation of volatility in the FX markets.
Spread products and other fixed income revenues increased 14%, primarily due to a comparison to a weak prior-year period, particularly in North America and EMEA.
Equity markets revenues increased 1%, as growth in equity derivatives and prime finance was partially offset by higher principal transactions revenues (up 17%).
lower cash equities revenues. Equity marketsderivatives and prime finance revenues increased 4%, as continued growth in client balances and higher client activity, particularly in EMEA, North America and Asia, weredriven by higher investor client activity and higher client balances. Cash equities revenues decreased across regions, reflecting a more challenging trading environment and lower commissions, as well as comparison to a strong prior-year period. Principal transactions revenues increased 35%, partially offset by a decrease in net interest revenue, mainly reflecting a change in the mix of trading positions in support of client activity.
Securities services revenues increased 11%. Excluding the impact of FX translation, revenues increased 15%, reflecting growth in all regions. The increase in revenues was driven by higher fee revenues, reflecting growth in both client volumes and assets under custody, as well as higher net interest revenue driven by higher deposit volume and higher interest rates.

Expenses increased 1%, driven by an increase in compensation costs, volume-related expenses and investments, partially offset by efficiency savings and a benefit from FX translation.
Provisions increased $235 million to $71 million, driven by higher provisions for unfunded lending commitments (up $211 million) and a higher net loan loss reserve build (up $45 million), partially offset by lower net credit losses (down $21 million). The increase in provisions was largely driven by volume-related reserve builds and an absence of episodica large release in the prior-year period. 


2018 YTD vs. 2017 YTD
Net income increased 10%, primarily driven by higher revenues and a lower effective tax rate due to the impact of Tax Reform, partially offset by higher expenses and higher credit costs.

Revenues increased 2%, driven by a 5% increase in Banking revenues, partially offset by a 1% decrease in Markets and securities services revenues. Excluding the gain on sale in the prior-year period, revenues increased 4%, reflecting higher revenues in both Banking (increase of 5%) and Markets and securities services (increase of 3%).

Within Banking:

Investment banking revenues declined 8%, due to a decline in market wallet across all major products as well as a particularly strong performance in the prior-year period. Advisory revenues increased 4%, reflecting gains in wallet share despite a decline in the overall market wallet. Equity underwriting revenues declined 7%, driven by the decline in market wallet. Debt underwriting revenues declined 13%, driven by the decline in market wallet as well as a decline in wallet share.
Treasury and trade solutions revenues increased 8%, reflecting growth across both net interest and fee income, driven by continued growth in deposit and loan volumes, improved deposit spreads and strong fee growth across most cash products.
Corporate lending revenues increased 27%. Excluding the impact of losses on loan hedges, revenues increased 17%, driven by the same factors described above. Average loans increased 10% versus the prior-year period.
Private bank revenues increased 12%, driven by strong client activity across all regions. The increase in revenues reflected higher deposit spreads, an increase in loans, higher managed investments revenues and increased capital markets activity.

Within Markets and securities services:

Fixed incomemarkets revenues decreased 2%, primarily due to lower revenues in North America,Asia and Latin America. Rates and currencies revenues increased 1%, driven by higher G10 FX revenues that benefited from the return of volatility in the FX markets, as well as strong corporate and investor client activity. This increase was partially offset by lower G10 rates revenues due to lower client activity, as well as a comparison to a strong prior-year period, primarily in EMEA. Spread products and other fixed income revenues decreased 9%, primarily in North America, largely due to lower investor client activity, reflecting the more challenging market environment and a comparison to a strong prior-year period.
Equity derivativesmarkets revenues increased 19%, reflecting strength in Asia, North America and EMEA, due to
growth in equity derivatives and prime finance, driven by stronger trading performance compared to the prior-year perioda more favorable operating environment with higher
market volatility and increased investor and corporate client activity, as well as higher investor client activity, partially offset by a modest decline in prime finance revenues due to spread mix. Cash equities revenues were modestly higher, driven by higher client activity in Asia, partially offset by lower activity in North America.
balances.
Securities services revenues increased 6%. Excluding the impact of prior year divestitures, revenues increased 11%, largely due to higher revenues in North America,Latin America and EMEA13%, driven by the same factors described above.

Expenses increased 4% from the prior-year period,, driven by the same factors described above, partially offset by lower repositioning costs.above.
Provisions decreased $664increased $337 million to $55 million, primarily reflecting a decline in net credit losses from $397 million in the prior-year perioddue to $140 millionvolume-related reserve builds for both funded loans and unfunded lending commitments, and a netlower loan loss reserve release of $422 million ($15 million release in the period-year period). This lower cost of credit was driven largely by improvement in the energy sector, as well as the release relatedcompared to the improvement in the provision for unfunded lending commitments.prior-year period.







CORPORATE/OTHER
Corporate/Other includes certain unallocated costs of global staff functions (including finance, risk, human resources, legal and compliance), other corporate expenses and unallocated global operations and technology expenses and income taxes, as well as Corporate Treasury, certain North America and international legacy consumer loan portfolios, other legacy assets and discontinued operations (for additional information on Corporate/Other, see “Citigroup Segments” above). At September 30, 2017,2018, Corporate/Other had $100$94 billion in assets, a decrease of 4% year-over-year and 3% from December 31, 2016.down $6 billion year-over-year.

Third Quarter Nine Months% ChangeThird Quarter Nine Months% Change
In millions of dollars20172016% Change2017201620182017% Change20182017
Net interest revenue$507
$706
(28)%$1,543
$2,416
(36)%$554
$516
7 %$1,645
$1,571
5 %
Non-interest revenue2
431
(100)796
1,852
(57)(60)3
NM
(32)810
NM
Total revenues, net of interest expense$509
$1,137
(55)%$2,339
$4,268
(45)%$494
$519
(5)%$1,613
$2,381
(32)%
Total operating expenses$822
$1,288
(36)%$2,929
$3,847
(24)%$459
$827
(44)%$1,799
$2,957
(39)%
Net credit losses$29
$131
(78)%$134
$374
(64)%$19
$29
(34)%$24
$134
(82)%
Credit reserve build (release)(79)(122)35
(268)(376)29
(43)(79)46
(171)(268)36
Provision (release) for unfunded lending commitments—
—
—
3
(6)NM
(5)—
—
(6)3
NM
Provision for benefits and claims—
9
(100)1
98
(99)(1)—
NM
(2)1
NM
Provisions for credit losses and for benefits and claims$(50)$18
NM
$(130)$90
NM
$(30)$(50)40 %$(155)$(130)(19)%
Income (loss) from continuing operations before taxes$(263)$(169)(56)%$(460)$331
NM
$65
$(258)NM
$(31)$(446)93 %
Income taxes (benefits)(164)(146)(12)%(439)(238)(84)%116
(163)NM
109
(435)NM
Income (loss) from continuing operations$(99)$(23)NM
$(21)$569
NM
$(51)$(95)46 %$(140)$(11)NM
Income (loss) from discontinued operations, net of taxes(5)(30)83 %(2)(55)96 %(8)(5)(60)—
(2)100 %
Net income (loss) before attribution of noncontrolling interests$(104)$(53)(96)%$(23)$514
NM
$(59)$(100)41 %$(140)$(13)NM
Noncontrolling interests(17)(5)NM
(13)(4)NM
8
(17)NM
26
(13)NM
Net income (loss)$(87)$(48)(81)%$(10)$518
NM
$(67)$(83)19 %$(166)$—
— %

NM Not meaningful

3Q173Q18 vs. 3Q163Q17
The net loss was $87$67 million, compared to a net loss of $48$83 million in the prior-year period, due toperiod. The lower revenues,net loss was largely driven by lower expenses, partially offset by higher taxes and a lower expenses and lower cost of credit.net loan loss reserve release.
Revenues decreased 55%5%, driven by the continued wind-down of legacy asset run-off, divestitures and lower revenue from treasury hedging activities.assets.
Expenses decreased 36%44%, primarily driven by the wind-down of legacy assets andas well as lower legal expenses.infrastructure costs.
Provisions decreased $68increased $20 million to a net benefit of $50$30 million, as lower net credit losses were more than offset by a lower net loan loss reserve release. The decline in net credit losses reflected the impact of ongoing divestiture activity, including the impact of the continued wind-down in the legacy North America mortgage portfolio.


2018 YTD vs. 2017 YTD
The net loss was $166 million, compared to $0 net income in the prior-year period, reflecting lower revenues and higher taxes, partially offset by lower expenses and a higher net benefit from credit.
Revenues decreased 32%, primarily duedriven by the same factors described above.
Expenses decreased 39%, driven by the same factors described above, as well as lower legal costs.
Provisions decreased $25 million to a net benefit of $155 million, driven by lower net credit losses, partially offset by a lower net loan loss reserve release. Net credit losses declined 78%82% to $29 million, primarily reflecting the impact of ongoing divestiture activity. The net reserve release declined 35%, mostly reflecting the continued wind-down of the North America mortgage portfolio, partially offset by a hurricane-related loan loss reserve build (of approximately $20 million).





2017 YTD vs. 2016 YTD
Year-to-date, Corporate/Other has experienced similar trends to those described above. The net loss was $10 million, compared to net income of $518 million in the prior-year period, reflecting lower revenues, partially offset by lower expenses and lower cost of credit.
Revenues decreased 45%, primarily driven by the same factors described above as well as the absence of gains related to debt buybacks in 2016. Revenues included approximately $750 million in gains on asset sales in the first quarter of 2017, which more than offset a roughly $300 million charge related to the exit of Citi’s U.S. mortgage servicing operations in the quarter.
Expenses decreased 24%, driven by the same factors described above, partially offset by approximately $100 million in episodic expenses primarily related to the exit of the U.S. mortgage servicing operations.
Provisions decreased $220$24 million, driven by the same factors described above. Net credit losses declined 64% to $134 million, reflecting the impact of ongoing divestiture activity as well as continued wind-down in the legacy North America mortgage portfolio. The provision for benefits and claims declined $97 million, reflecting continued legacy divestitures. The net reserve release declined 31%, driven by the same factors described above.



OFF-BALANCE SHEET ARRANGEMENTS

The table below shows the location ofwhere a discussion of Citi’s various off-balance sheet arrangements in this Form 10-Q.10-Q may be found. For additional information, on Citi’s off-balance sheet arrangements, see “Off-Balance Sheet Arrangements” and Notes 1, 21 and 26 to the Consolidated Financial Statements in Citigroup’s 20162017 Annual Report on Form 10-K.
Types of Off-Balance Sheet Arrangements Disclosures in this Form 10-Q
Variable interests and other obligations, including contingent obligations, arising from variable interests in nonconsolidated VIEsSee Note 18 to the Consolidated Financial Statements.
Letters of credit, and lending and other commitmentsSee Note 22 to the Consolidated Financial Statements.
GuaranteesSee Note 22 to the Consolidated Financial Statements.


CAPITAL RESOURCES
Overview
Capital is used principally to support assets in Citi’s businesses and to absorb credit, market and operational losses. Citi primarily generates capital through earnings from its operating businesses. Citi may augment its capital through issuances of common stock, noncumulative perpetual preferred stock and equity issued through awards under employee benefit plans, among other issuances.
Further, Citi’s capital levels may also be affected by changes in accounting and regulatory standards, as well as U.S. corporate tax laws and the impact of future events on Citi’s business results, such as changes in interest and foreign exchange rates, as well as business and asset dispositions.
During the third quarter of 2017,2018, Citi returned a total of approximately $6.4 billion of capital to common shareholders in the form of share repurchases (approximately 8175 million common shares) and dividends.
 
Capital Management
Citi’s capital management framework is designed to ensure that Citigroup and its principal subsidiaries maintain sufficient capital consistent with each entity’s respective risk profile, management targets and all applicable regulatory standards and guidelines. Based on Citigroup’s current regulatory capital requirements, as well as consideration of potential future changes to the U.S. Basel III rules, management currently believes that a targeted Common Equity Tier 1 Capital ratio of approximately 11.5% represents the amount necessary to prudently operate and invest in Citi’s franchise, including when considering future growth plans, capital return projections and other factors that may impact Citi’s businesses. However, management may revise Citigroup’s targeted Common Equity Tier 1 Capital ratio in response to changing regulatory capital requirements as well as other relevant factors. For additional information regarding Citi’s capital management, see “Capital Resources—Capital Management” in Citigroup’s 20162017 Annual Report on Form 10-K.

Stress Testing Component of Capital Planning and Stress Testing
Citi is subject to an annual assessment by the Federal Reserve Board as to whether Citigroup has effective capital planning processes as well as sufficient regulatory capital to absorb losses during stressful economic and financial conditions, while also meeting obligations to creditors and counterparties and continuing to serve as a credit intermediary. This annual assessment includes two related programs: the Comprehensive Capital Analysis and Review (CCAR) and Dodd-Frank Act Stress Testing (DFAST). For additional information regarding Citi’sthe stress testing component of capital planning, see “Forward-Looking Statements” below and stress testing, including“Capital Resources—Current Regulatory Capital Standards—Stress Testing Component of Capital Planning” and “Risk Factors—Strategic Risks”
in Citigroup’s 2017 Annual Report on Form 10-K. For additional information regarding a recent proposed rulemaking and other potential changes in Citi’s regulatory capital requirements and future CCAR processes, see “Forward-Looking Statements” below and “Capital Resources—Current Regulatory“Regulatory Capital Standards—Capital Planning and Stress Testing” and “Risk Factors—Strategic Risks”Standards Developments” in Citigroup’s 2016 Annual Report onthe First Quarter of 2018 Form 10-K.10-Q.









Current Regulatory Capital Standards
Citi is subject to regulatory capital standards issued by the Federal Reserve Board, which constitute the U.S. Basel III rules. These rules establish an integrated capital adequacy framework, encompassing both risk-based capital ratios and leverage ratios. For additional information regarding the risk-based capital ratios, Tier 1 Leverage ratio and Supplementary Leverage ratio, see “Capital Resources—Current Regulatory Capital Standards” in Citigroup’s 20162017 Annual Report on Form 10-K.

GSIB Surcharge
The Federal Reserve Board also adopted a rule that imposes a risk-based capital surcharge upon U.S. bank holding companies that are identified as global systemically important bank holding companies (GSIBs),GSIBs, including Citi. GSIB surcharges under the rule initially range from 1% to 4.5% of total risk-weighted assets. Citi’s initial GSIB surcharge effective January 1, 2016 was 3.5%for 2018 remains unchanged from 2017 at 3.0%. However, ongoing efforts in addressing quantitative measures of systemic importance have resulted in a reduction of Citi’s GSIB surcharge to 3%, effective January 1, 2017. For additional information regarding the identification of a GSIB and the methodology for annually determining the GSIB surcharge, see “Capital Resources—Current Regulatory Capital Standards—GSIB Surcharge” in Citigroup’s 20162017 Annual Report on Form 10-K.

Transition Provisions
The U.S. Basel III rules contain several differing, largely multi-year transition provisions (i.e., “phase-ins” and “phase-outs”). Citi considers all of these transition provisions as being fully implementedMoreover, the GSIB surcharge, Capital Conservation Buffer, and any Countercyclical Capital Buffer (currently 0%), commenced phase-in on January 1, 2016, becoming fully effective on January 1, 2019. With the exception of the non-grandfathered trust preferred securities, which do not fully phase-out until January 1, 2022, and the capital buffers and GSIB surcharge, which do not fully phase-in until January 1, 2019, (full implementation). all other transition provisions are entirely reflected in Citi’s regulatory capital ratios beginning January 1, 2018. Accordingly, commencing with the first quarter of 2018, Citi is presenting a single set of regulatory capital components and ratios, reflecting current regulatory capital standards in effect throughout 2018. Citi previously disclosed its Basel III risk-based capital and leverage ratios and related components reflecting Basel III Transition Arrangements with respect to regulatory capital adjustments and deductions, as well as Full Implementation, in Citi’s 2017 Annual Report on Form 10-K and Quarterly Reports on Form 10-Q; however, beginning January 1, 2018, that distinction is no longer relevant.
For additional information regarding the transition provisions under the U.S. Basel III rules, including with respect to the GSIB surcharge, see “Capital Resources—


Current Regulatory Capital Standards—Transition Provisions” in Citigroup’s 20162017 Annual Report on Form 10-K.


For information regarding Citigroup’s capital resources reflecting Basel III Transition Arrangements as of December 31, 2017, see “Capital Resources—Current Regulatory Capital Standards—Citigroup’s Capital Resources Under Current Regulatory StandardsStandards” in Citigroup’s 2017 Annual Report on Form 10-K.

Citigroup’s Capital Resources
Citi is required to maintain stated minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios of 4.5%, 6%6.0% and 8%8.0%, respectively.
Citi’s effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios during 2018, inclusive of the 75% phase-in of both the 2.5% Capital Conservation Buffer and the 3.0% GSIB surcharge (all of which is to be composed of Common Equity Tier 1 Capital), are 8.625%, 10.125% and 12.125%, respectively. Citi’s effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios during 2017, inclusive of the 50% phase-in of both the 2.5% Capital Conservation Buffer and the 3% GSIB surcharge (all of which is to be composed of Common Equity Tier 1 Capital), are 7.25%, 8.75% and 10.75%, respectively. Citi’s effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios during 2016, inclusive of the 25% phase-in of both the 2.5% Capital Conservation Buffer and the 3.5%3.0% GSIB surcharge (all of which is to be composed of Common Equity Tier 1 Capital), were 6%7.25%, 7.5%8.75% and 9.5%10.75%, respectively.
 
Citi currently estimates that its effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratio requirements during 2019, inclusive of the 2.5% Capital Conservation Buffer and the Countercyclical Capital Buffer at its current level of 0%, as well as a 3.0% GSIB surcharge, may be 10.0%, 11.5% and 13.5%, respectively.
Furthermore, to be “well capitalized” under current federal bank regulatory agency definitions, a bank holding
company must have a Tier 1 Capital ratio of at least 6%6.0%, a Total Capital ratio of at least 10%10.0%, and not be subject to a Federal Reserve Board directive to maintain higher capital levels.
Under the U.S. Basel III rules, Citi must comply with a 4.0% minimum Tier 1 Leverage ratio requirement. Effective January 1, 2018, Citi must also comply with an effective 5.0% minimum Supplementary Leverage ratio requirement.
The following tables set forth the capital tiers, total risk-weighted assets and underlying risk components, risk-based capital ratios, quarterly adjusted average total assets, Total Leverage Exposure and leverage ratios under current regulatory standards (reflecting Basel III Transition Arrangements) for Citi as of September 30, 20172018 and December 31, 2016.2017.

Citigroup Capital Components and Ratios Under Current Regulatory Standards (Basel III Transition Arrangements)
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollars, except ratiosAdvanced ApproachesStandardized ApproachAdvanced ApproachesStandardized ApproachAdvanced ApproachesStandardized ApproachAdvanced ApproachesStandardized Approach
Common Equity Tier 1 Capital$162,008
$162,008
$167,378
$167,378
$140,428
$140,428
$142,822
$142,822
Tier 1 Capital177,304
177,304
178,387
178,387
159,877
159,877
162,377
162,377
Total Capital (Tier 1 Capital + Tier 2 Capital)202,643
214,787
202,146
214,938
184,623
196,808
187,877
199,989
Total Risk-Weighted Assets1,143,448
1,158,679
1,166,764
1,126,314
1,155,188
1,196,923
1,152,644
1,155,099
Credit Risk(1)
$756,529
$1,093,468
$773,483
$1,061,786
Credit Risk$769,942
$1,126,869
$767,102
$1,089,372
Market Risk64,368
65,211
64,006
64,528
68,647
70,054
65,003
65,727
Operational Risk322,551
—
329,275
—
316,599
—
320,539
—
Common Equity Tier 1 Capital ratio(2)
14.17%13.98%14.35%14.86%
Tier 1 Capital ratio(2)
15.51
15.30
15.29
15.84
Total Capital ratio(2)
17.72
18.54
17.33
19.08
Common Equity Tier 1 Capital ratio(1)(2)
12.16%11.73%12.39%12.36%
Tier 1 Capital ratio(1)(2)
13.84
13.36
14.09
14.06
Total Capital ratio(1)(2)
15.98
16.44
16.30
17.31
In millions of dollars, except ratiosSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Quarterly Adjusted Average Total Assets(3)
 $1,838,307
 $1,768,415
 $1,882,493
 $1,868,326
Total Leverage Exposure(4)
 2,433,814
 2,351,883
 2,459,993
 2,432,491
Tier 1 Leverage ratio(2) 9.64% 10.09% 8.49% 8.69%
Supplementary Leverage ratio(2) 7.29
 7.58
 6.50
 6.68

(1)Under the U.S. Basel III rules, credit risk-weighted assets during the transition period reflect the effects of transition arrangements related to regulatory capital adjustments and deductions and, as a result, will differ from credit risk-weighted assets derived under full implementation of the rules.
(2)As of September 30, 2017, Citi’s reportable Common Equity Tier 1 Capital and Tier 1 Capital ratios were the lower derived under the Basel III Standardized Approach, whereas the reportable Total Capital ratio was the lower derived under the Basel III Advanced Approaches framework. As of December 31, 2016, Citi’s reportable Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios were the lower derived under the Basel III Advanced Approaches framework.
(3)Tier 1 Leverage ratio denominator.
(4)Supplementary Leverage ratio denominator.

As indicated in the table above, Citigroup’s risk-based capital ratios at September 30, 2017 were in excess of the stated and effective minimum requirements under the U.S. Basel III rules. In addition, Citi was also “well capitalized” under current federal bank regulatory agency definitions as of September 30, 2017.





Components of Citigroup Capital Under Current Regulatory Standards (Basel III Transition Arrangements)
In millions of dollarsSeptember 30,
2017		December 31, 2016
Common Equity Tier 1 Capital  
Citigroup common stockholders’ equity(1)
$208,565
$206,051
Add: Qualifying noncontrolling interests209
259
Regulatory Capital Adjustments and Deductions:  
Less: Net unrealized losses on securities available-for-sale (AFS), net of tax(2)(3)
(34)(320)
Less: Defined benefit plans liability adjustment, net of tax(3)
(1,068)(2,066)
Less: Accumulated net unrealized losses on cash flow hedges, net of tax(4)
(437)(560)
Less: Cumulative unrealized net loss related to changes in fair value of financial liabilities
   attributable to own creditworthiness, net of tax(3)(5)
(333)(37)
Less: Intangible assets:  
Goodwill, net of related deferred tax liabilities (DTLs)(6)
21,532
20,858
Identifiable intangible assets other than mortgage servicing rights (MSRs), net of related
   DTLs(3)
3,528
2,926
Less: Defined benefit pension plan net assets(3)
576
514
Less: Deferred tax assets (DTAs) arising from net operating loss, foreign tax credit and
   general business credit carry-forwards(3)(7)
16,054
12,802
Less: Excess over 10%/15% limitations for other DTAs, certain common stock investments,
  and MSRs(3)(7)(8)
6,948
4,815
Total Common Equity Tier 1 Capital (Standardized Approach and Advanced Approaches)$162,008
$167,378
Additional Tier 1 Capital  
Qualifying noncumulative perpetual preferred stock(1)
$19,069
$19,069
Qualifying trust preferred securities(9)
1,374
1,371
Qualifying noncontrolling interests118
17
Regulatory Capital Adjustment and Deductions:  
Less: Cumulative unrealized net loss related to changes in fair value of financial liabilities
   attributable to own creditworthiness, net of tax(3)(5)
(83)(24)
Less: Defined benefit pension plan net assets(3)
144
343
Less: DTAs arising from net operating loss, foreign tax credit and
   general business credit carry-forwards(3)(7)
4,014
8,535
Less: Permitted ownership interests in covered funds(10)
1,128
533
Less: Minimum regulatory capital requirements of insurance underwriting subsidiaries(11)
62
61
Total Additional Tier 1 Capital (Standardized Approach and Advanced Approaches)$15,296
$11,009
Total Tier 1 Capital (Common Equity Tier 1 Capital + Additional Tier 1 Capital)
   (Standardized Approach and Advanced Approaches)
$177,304
$178,387
Tier 2 Capital  
Qualifying subordinated debt$23,578
$22,818
Qualifying trust preferred securities(12)
329
317
Qualifying noncontrolling interests39
22
Eligible allowance for credit losses(13)
13,598
13,452
Regulatory Capital Adjustment and Deduction:  
Add: Unrealized gains on AFS equity exposures includable in Tier 2 Capital1
3
Less: Minimum regulatory capital requirements of insurance underwriting subsidiaries(11)
62
61
Total Tier 2 Capital (Standardized Approach)$37,483
$36,551
Total Capital (Tier 1 Capital + Tier 2 Capital) (Standardized Approach)$214,787
$214,938
Adjustment for excess of eligible credit reserves over expected credit losses(13)
$(12,144)$(12,792)
Total Tier 2 Capital (Advanced Approaches)

$25,339
$23,759
Total Capital (Tier 1 Capital + Tier 2 Capital) (Advanced Approaches)$202,643
$202,146

Footnotes are presented on the following page.



(1)Issuance costs of $184 million related to noncumulative perpetual preferred stock outstanding at September 30, 20172018 and December 31, 2016 are excluded from common stockholders’ equity and netted against such preferred stock in accordance with Federal Reserve Board regulatory reporting requirements, which differ from those under U.S. generally accepted accounting principles (GAAP).
(2)In addition, includes the net amount of unamortized loss on held-to-maturity (HTM) securities. This amount relates to securities that were previously transferred from AFS to HTM, and non-credit-related factors such as changes in interest rates and liquidity spreads for HTM securities with other-than-temporary impairment.
(3)The transition arrangements for significant regulatory capital adjustments and deductions impacting Common Equity Tier 1 Capital and Additional Tier 1 Capital are set forth in the chart entitled “Basel III Transition Arrangements: Significant Regulatory Capital Adjustments and Deductions,” as presented in Citigroup’s 2016 Annual Report on Form 10-K.
(4)
Common Equity Tier 1 Capital is adjusted for accumulated net unrealized gains (losses) on cash flow hedges included in Accumulated other comprehensive income (loss) (AOCI) that relate to the hedging of items not recognized at fair value on the balance sheet.
(5)The cumulative impact of changes in Citigroup’s own creditworthiness in valuing liabilities for which the fair value option has been elected, and own-credit valuation adjustments on derivatives, are excluded from Common Equity Tier 1 Capital and Additional Tier 1 Capital, in accordance with the U.S. Basel III rules.
(6)Includes goodwill “embedded” in the valuation of significant common stock investments in unconsolidated financial institutions.
(7)Of Citi’s approximately $45.5 billion of net DTAs at September 30, 2017, approximately $19.9 billion were includable in regulatory capital pursuant to the U.S. Basel III rules, while approximately $25.6 billion were excluded. Excluded from Citi’s regulatory capital at September 30, 2017 was in total approximately $27.0 billion of net DTAs arising from both net operating loss, foreign tax credit and general business credit carry-forwards as well as temporary differences, of which approximately $23.0 billion were deducted from Common Equity Tier 1 Capital and approximately $4.0 billion were deducted from Additional Tier 1 Capital, which was reduced by approximately $1.4 billion of net DTLs primarily associated with goodwill and certain other intangible assets. Separately, under the U.S. Basel III rules, goodwill and these other intangible assets are deducted net of associated DTLs in arriving at Common Equity Tier 1 Capital. DTAs arising from net operating loss, foreign tax credit and general business credit carry-forwards are required to be deducted from both Common Equity Tier 1 Capital and Additional Tier 1 Capital under the transition arrangements of the U.S. Basel III rules; whereas DTAs arising from temporary differences are deducted solely from Common Equity Tier 1 Capital under these rules, if in excess of 10%/15% limitations.
(8)Assets subject to 10%/15% limitations include MSRs, DTAs arising from temporary differences and significant common stock investments in unconsolidated financial institutions. At September 30, 2017 and December 31, 2016, this deduction related only to DTAs arising from temporary differences that exceeded the 10% limitation. Accordingly, approximately $6.9 billion of DTAs arising from temporary differences were excluded from Citi’s Common Equity Tier 1 Capital at September 30, 2017. Changes to the U.S. corporate tax regime that impact the value of Citi’s DTAs arising from temporary differences, which exceed the then current amount deducted from Citi’s Common Equity Tier 1 Capital, would further reduce Citi’s regulatory capital to the extent of such excess after tax. For additional information regarding potential U.S. corporate tax reform, see “Risk Factors—Strategic Risks” in Citigroup’s 2016 Annual Report on Form 10-K.
(9)Represents Citigroup Capital XIII trust preferred securities, which are permanently grandfathered as Tier 1 Capital under the U.S. Basel III rules.
(10)Banking entities are required to be in compliance with the Volcker Rule of the Dodd-Frank Act that prohibits conducting certain proprietary investment activities and limits their ownership of, and relationships with, covered funds. Accordingly, Citi is required by the Volcker Rule to deduct from Tier 1 Capital all permitted ownership interests in covered funds that were acquired after December 31, 2013.
(11)50% of the minimum regulatory capital requirements of insurance underwriting subsidiaries must be deducted from each of Tier 1 Capital and Tier 2 Capital.
(12)Effective January 1, 2016, non-grandfathered trust preferred securities are not eligible for inclusion in Tier 1 Capital, but are eligible for inclusion in Tier 2 Capital subject to full phase-out by January 1, 2022. Non-grandfathered trust preferred securities are eligible for inclusion in Tier 2 Capital in an amount up to 50% and 60% during 2017 and 2016, respectively, of the aggregate outstanding principal amounts of such issuances as of January 1, 2014, in accordance with the transition arrangements for non-qualifying capital instruments under the U.S. Basel III rules.
(13)Under the Standardized Approach, the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any excess allowance for credit losses being deducted in arriving at credit risk-weighted assets, which differs from the Advanced Approaches framework, in which eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent the excess reserves do not exceed 0.6% of credit risk-weighted assets. The total amount of eligible credit reserves in excess of expected credit losses that were eligible for inclusion in Tier 2 Capital, subject to limitation, under the Advanced Approaches framework was $1.5 billion and $0.7 billion at September 30, 2017 and December 31, 2016, respectively.


Citigroup Capital Rollforward Under Current Regulatory Standards (Basel III Transition Arrangements)
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended  
  September 30, 2017
Common Equity Tier 1 Capital, beginning of period$163,786
$167,378
Net income4,133
12,095
Common and preferred stock dividends declared(1,137)(2,648)
Net increase in treasury stock(5,487)(9,186)
Net change in common stock and additional paid-in capital98
(147)
Net decrease in foreign currency translation adjustment net of hedges, net of tax218
2,179
Net change in unrealized losses on securities AFS, net of tax(52)345
Net increase in defined benefit plans liability adjustment, net of tax(23)(1,174)
Net change in adjustment related to changes in fair value of financial liabilities
    attributable to own creditworthiness, net of tax
(23)29
Net change in goodwill, net of related DTLs57
(674)
Net change in identifiable intangible assets other than MSRs, net of related DTLs142
(602)
Net change in defined benefit pension plan net assets61
(62)
Net change in DTAs arising from net operating loss, foreign tax credit and
    general business credit carry-forwards
612
(3,252)
Net increase in excess over 10%/15% limitations for other DTAs, certain common
    stock investments and MSRs
(374)(2,133)
Other(3)(140)
Net decrease in Common Equity Tier 1 Capital$(1,778)$(5,370)
Common Equity Tier 1 Capital, end of period
    (Standardized Approach and Advanced Approaches)
$162,008
$162,008
Additional Tier 1 Capital, beginning of period$15,758
$11,009
Net increase in qualifying trust preferred securities—
3
Net change in adjustment related to changes in fair value of financial liabilities
    attributable to own creditworthiness, net of tax
25
59
Net decrease in defined benefit pension plan net assets15
199
Net decrease in DTAs arising from net operating loss, foreign tax credit and
    general business credit carry-forwards
152
4,521
Net increase in permitted ownership interests in covered funds(633)(595)
Other(21)100
Net change in Additional Tier 1 Capital$(462)$4,287
Tier 1 Capital, end of period
    (Standardized Approach and Advanced Approaches)
$177,304
$177,304
Tier 2 Capital, beginning of period (Standardized Approach)$37,383
$36,551
Net change in qualifying subordinated debt(64)760
Net increase in qualifying trust preferred securities5
12
Net increase in eligible allowance for credit losses165
146
Other(6)14
Net increase in Tier 2 Capital (Standardized Approach)$100
$932
Tier 2 Capital, end of period (Standardized Approach)$37,483
$37,483
Total Capital, end of period (Standardized Approach)$214,787
$214,787
   
Tier 2 Capital, beginning of period (Advanced Approaches)$25,246
$23,759
Net change in qualifying subordinated debt(64)760
Net increase in qualifying trust preferred securities5
12
Net increase in excess of eligible credit reserves over expected credit losses158
794
Other(6)14
Net increase in Tier 2 Capital (Advanced Approaches)$93
$1,580
Tier 2 Capital, end of period (Advanced Approaches)$25,339
$25,339
Total Capital, end of period (Advanced Approaches)$202,643
$202,643




Citigroup Risk-Weighted Assets Rollforward Under Current Regulatory Standards
(Basel III Standardized Approach with Transition Arrangements)
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended  
September 30, 2017
 Total Risk-Weighted Assets, beginning of period$1,163,894
$1,126,314
Changes in Credit Risk-Weighted Assets  
Net increase in general credit risk exposures(1)
1,511
15,154
Net increase in repo-style transactions(2)
8,430
15,417
Net decrease in securitization exposures(3)
(4,129)(6,183)
Net increase in equity exposures809
1,556
Net increase in over-the-counter (OTC) derivatives(4)
2,827
1,746
Net change in other exposures(5)
(1,508)1,401
Net change in off-balance sheet exposures(6)
(731)2,591
Net increase in Credit Risk-Weighted Assets$7,209
$31,682
Changes in Market Risk-Weighted Assets  
Net change in risk levels(7)
$(1,727)$14,163
Net decrease due to model and methodology updates(8)
(10,697)(13,480)
Net change in Market Risk-Weighted Assets$(12,424)$683
Total Risk-Weighted Assets, end of period$1,158,679
$1,158,679

(1)General credit risk exposures include cash and balances due from depository institutions, securities, and loans and leases. General credit risk exposures increased during the three and nine months ended September 30, 2017 primarily due to corporate loan growth.
(2)Repo-style transactions include repurchase or reverse repurchase transactions and securities borrowing or securities lending transactions.
(3)Securitization exposures decreased during the three and nine months ended September 30, 2017 principally as a result of certain securitization exposures becoming subject to deduction from Tier 1 Capital under the Volcker Rule of the Dodd-Frank Act.
(4)OTC derivatives increased during the three and nine months ended September 30, 2017 primarily due to increased trade volume.
(5)Other exposures include cleared transactions, unsettled transactions, and other assets. Other exposures decreased during the three months ended September 30, 2017, as growth in cleared transactions was more than offset by the impact of supervisory guidance on the regulatory capital treatment of certain centrally cleared derivatives. Other exposures increased during the nine months ended September 30, 2017 primarily due to growth in cleared transactions.
(6)Off-balance sheet exposures increased during the nine months ended September 30, 2017, as the growth in corporate exposures and reduced hedging benefits during the first quarter of 2017 more than offset the decline in off-balance sheet exposures during the second and third quarter of 2017.
(7)Risk levels decreased during the three months ended September 30, 2017 primarily due to a decrease in exposure levels subject to Stressed Value at Risk and Value at Risk. Risk levels increased during the nine months ended September 30, 2017 primarily due to an increase in exposure levels subject to comprehensive risk, as well as an increase in positions subject to securitization charges and standard specific risk charges.
(8)Risk-weighted assets declined during the three and nine months ended September 30, 2017, as Citi received supervisory approval to remove the Comprehensive Risk Measure model surcharge for correlation trading portfolios, commencing with the third quarter of 2017. Further contributing to the decline in risk-weighted assets during the three and nine months ended September 30, 2017, were changes in model inputs regarding volatility and the correlation between market risk factors.



Citigroup Risk-Weighted Assets Rollforward Under Current Regulatory Standards
(Basel III Advanced Approaches with Transition Arrangements)
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended  
  September 30, 2017
 Total Risk-Weighted Assets, beginning of period$1,157,670
$1,166,764
Changes in Credit Risk-Weighted Assets  
Net change in retail exposures(1)
1,898
(6,757)
Net decrease in wholesale exposures(2)
(6,362)(5,946)
Net increase in repo-style transactions(3)
4,658
4,660
Net decrease in securitization exposures(4)
(4,362)(6,477)
Net increase in equity exposures737
1,336
Net change in over-the-counter (OTC) derivatives(5)
1,088
(5,009)
Net change in derivatives CVA1,017
(83)
Net increase in other exposures(6)
2,326
2,277
Net decrease in supervisory 6% multiplier(7)
(1)(955)
Net change in Credit Risk-Weighted Assets$999
$(16,954)
Changes in Market Risk-Weighted Assets  
Net change in risk levels(8)
$(2,075)$13,842
Net decrease due to model and methodology updates(9)
(10,697)(13,480)
Net change in Market Risk-Weighted Assets$(12,772)$362
Net decrease in Operational Risk-Weighted Assets(10)
$(2,449)$(6,724)
Total Risk-Weighted Assets, end of period$1,143,448
$1,143,448

(1)Retail exposures increased during the three months ended September 30, 2017 primarily due to model enhancements. Retail exposures decreased during the nine months ended September 30, 2017 principally resulting from residential mortgage loan sales and repayments, and divestitures of certain legacy assets.
(2)Wholesale exposures decreased during the three months ended September 30, 2017 as the impact of certain loan syndications more than offset corporate loan growth. Wholesale exposures decreased during the nine months ended September 30, 2017 primarily due to annual updates to model parameters.
(3)Repo-style transactions include repurchase or reverse repurchase transactions and securities borrowing or securities lending transactions.
(4)Securitization exposures decreased during the three and nine months ended September 30, 2017 principally as a result of certain securitization exposures becoming subject to deduction from Tier 1 Capital under the Volcker Rule of the Dodd-Frank Act.
(5)OTC derivatives increased during the three months ended September 30, 2017 primarily due to changes in fair value. OTC derivatives decreased during the nine months ended September 30, 2017 primarily due to changes in fair value and improved portfolio credit quality.
(6)Other exposures include cleared transactions, unsettled transactions, assets other than those reportable in specific exposure categories, and non-material portfolios. Other exposures increased during the three and nine months ended September 30, 2017 primarily due to increases in cleared transactions.
(7)Supervisory 6% multiplier does not apply to derivatives CVA.
(8)Risk levels decreased during the three months ended September 30, 2017 primarily due to a decrease in exposure levels subject to Stressed Value at Risk and Value at Risk. Risk levels increased during the nine months ended September 30, 2017 primarily due to an increase in exposure levels subject to comprehensive risk, as well as an increase in positions subject to securitization charges and standard specific risk charges.
(9)Risk-weighted assets declined during the three and nine months ended September 30, 2017, as Citi received supervisory approval to remove the Comprehensive Risk Measure model surcharge for correlation trading portfolios, commencing with the third quarter of 2017. Further contributing to the decline in risk-weighted assets during the three and nine months ended September 30, 2017, were changes in model inputs regarding volatility and the correlation between market risk factors.
(10)Operational risk-weighted assets decreased during the three and nine months ended September 30, 2017 primarily due to assessed improvements in the business environment and risk controls. Further contributing to the decline in operational risk-weighted assets during the nine months ended September 30, 2017 were changes in operational loss severity and frequency.


Capital Resources of Citigroup’s Subsidiary U.S. Depository Institutions Under Current Regulatory Standards
Citigroup’s subsidiary U.S. depository institutions are also subject to regulatory capital standards issued by their respective primary federal bank regulatory agencies, which are similar to the standards of the Federal Reserve Board.
During 2017, Citi’s primary subsidiary U.S. depository institution, Citibank, N.A. (Citibank), is subject to effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios, inclusive of the 50% phase-in of the 2.5% Capital Conservation Buffer, of 5.75%, 7.25% and 9.25%, respectively. Citibank’s effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios during 2016, inclusive of the 25% phase-in of
the 2.5% Capital Conservation Buffer, were 5.125%, 6.625% and 8.625%, respectively. Citibank is required to maintain stated minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios of 4.5%, 6% and 8%, respectively.
The following tables set forth the capital tiers, total risk-weighted assets and underlying risk components, risk-based capital ratios, quarterly adjusted average total assets, Total Leverage Exposure and leverage ratios under current regulatory standards (reflecting Basel III Transition Arrangements) for Citibank, Citi’s primary subsidiary U.S. depository institution, as of September 30, 2017 and December 31, 2016.
Citibank Capital Components and Ratios Under Current Regulatory Standards (Basel III Transition Arrangements)
 September 30, 2017December 31, 2016
In millions of dollars, except ratiosAdvanced ApproachesStandardized ApproachAdvanced ApproachesStandardized Approach
Common Equity Tier 1 Capital$129,170
$129,170
$126,220
$126,220
Tier 1 Capital130,564
130,564
126,465
126,465
Total Capital (Tier 1 Capital + Tier 2 Capital)(1)
143,608
154,424
138,821
150,291
Total Risk-Weighted Assets962,968
1,044,808
973,933
1,001,016
   Credit Risk$666,691
$995,230
$669,920
$955,767
   Market Risk48,496
49,578
44,579
45,249
   Operational Risk247,781
—
259,434
—
Common Equity Tier 1 Capital ratio(2)(3)
13.41%12.36%12.96%12.61%
Tier 1 Capital ratio(2)(3)
13.56
12.50
12.99
12.63
Total Capital ratio(2)(3)
14.91
14.78
14.25
15.01
In millions of dollars, except ratiosSeptember 30, 2017December 31, 2016
Quarterly Adjusted Average Total Assets(4)
 $1,396,879
 $1,333,161
Total Leverage Exposure(5) 
 1,929,785
 1,859,394
Tier 1 Leverage ratio(3)
 9.35% 9.49%
Supplementary Leverage ratio 6.77
 6.80

(1)Under the Advanced Approaches framework, eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent the excess reserves do not exceed 0.6% of credit risk-weighted assets, which differs from the Standardized Approach in which the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any excess allowance for credit losses being deducted in arriving at credit risk-weighted assets.
(2)As of September 30, 2017, Citibank’s reportable Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios were the lower derived under the Basel III Standardized Approach. As of December 31, 2016, Citibank’s reportable Common Equity Tier 1 Capital and Tier 1 Capital ratios were the lower derived under the Basel III Standardized Approach, whereas the reportable Total Capital ratio was the lower derived under the Basel III Advanced Approaches framework.
(3)Citibank must maintain minimum Common Equity Tier 1 Capital, Tier 1 Capital, Total Capital and Tier 1 Leverage ratios of 6.5%, 8%, 10% and 5%, respectively, to be considered “well capitalized” under the revised Prompt Corrective Action (PCA) regulations applicable to insured depository institutions as established by the U.S. Basel III rules. For additional information, see “Capital Resources—Current Regulatory Capital Standards—Prompt Corrective Action Framework” in Citigroup’s 2016 Annual Report on Form 10-K.
(4)Tier 1 Leverage ratio denominator.
(5)Supplementary Leverage ratio denominator.

As indicated in the table above, Citibank’s risk-based capital ratios at September 30, 2017 were in excess of the stated and effective minimum requirements under the U.S. Basel III rules. In addition, Citibank was also “well


capitalized” as of September 30, 2017 under the revised PCA regulations, which became effective January 1, 2015.



Impact of Changes on Citigroup and Citibank Capital Ratios Under Current Regulatory Capital Standards
The following tables present the estimated sensitivity of Citigroup’s and Citibank’s capital ratios to changes of $100 million in Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital (numerator), and changes of $1 billion in
Advanced Approaches and Standardized Approach risk-weighted assets and quarterly adjusted average total assets, as well as Total Leverage Exposure (denominator), under current regulatory capital standards (reflecting Basel III Transition Arrangements), as of September 30, 2017.
This information is provided for the purpose of analyzing the impact that a change in Citigroup’s or Citibank’s financial position or results of operations could have on these ratios. These sensitivities only consider a single change to either a component of capital, risk-weighted assets, quarterly adjusted average total assets or Total Leverage Exposure. Accordingly, an event that affects more than one factor may have a larger basis point impact than is reflected in these tables.


Impact of Changes on Citigroup and Citibank Risk-Based Capital Ratios (Basel III Transition Arrangements)
 
Common Equity
Tier 1 Capital ratio
Tier 1 Capital ratioTotal Capital ratio
In basis points
Impact of
$100 million
change in
Common Equity
Tier 1 Capital
Impact of
$1 billion
change in risk-
weighted assets
Impact of
$100 million
change in
Tier 1 Capital
Impact of
$1 billion
change in risk-
weighted assets
Impact of
$100 million
change in
Total Capital
Impact of
$1 billion
change in risk-
weighted assets
Citigroup      
Advanced Approaches0.91.20.91.40.91.6
Standardized Approach0.91.20.91.30.91.6
Citibank      
Advanced Approaches1.01.41.01.41.01.6
Standardized Approach1.01.21.01.21.01.4

Impact of Changes on Citigroup and Citibank Leverage Ratios (Basel III Transition Arrangements)
 Tier 1 Leverage ratioSupplementary Leverage ratio
In basis points
Impact of
$100 million
change in
Tier 1 Capital
Impact of
$1 billion
change in quarterly adjusted average total assets
Impact of
$100 million
change in
Tier 1 Capital
Impact of
$1 billion
change in Total Leverage Exposure
Citigroup0.50.50.40.3
Citibank0.70.70.50.4

Citigroup Broker-Dealer Subsidiaries
At September 30, 2017, Citigroup Global Markets Inc., a U.S. broker-dealer registered with the SEC that is an indirect wholly owned subsidiary of Citigroup, had net capital, computed in accordance with the SEC’s net capital rule, of approximately $10.5 billion, which exceeded the minimum requirement by approximately $8.5 billion.
Moreover, Citigroup Global Markets Limited, a broker-dealer registered with the United Kingdom’s Prudential Regulation Authority (PRA) that is also an indirect wholly owned subsidiary of Citigroup, had total capital of approximately $17.2 billion at September 30, 2017, which exceeded the PRA's minimum regulatory capital requirements.



In addition, certain of Citi’s other broker-dealer
subsidiaries are subject to regulation in the countries in which they do business, including requirements to maintain specified levels of net capital or its equivalent. Citigroup’s other broker-dealer subsidiaries were in compliance with
their regulatory capital requirements at September 30, 2017.












Basel III (Full Implementation)

Citigroup’s Capital Resources Under Basel III
(Full Implementation)
Citi currently estimates that its effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratio requirements under the U.S. Basel III rules, on a fully implemented basis, inclusive of the 2.5% Capital Conservation Buffer and the Countercyclical Capital Buffer at its current level of 0%, as well as an expected 3% GSIB surcharge, may be 10%, 11.5% and 13.5%, respectively.
Further, under the U.S. Basel III rules, Citi must also comply with a 4% minimum Tier 1 Leverage ratio requirement and an effective 5% minimum Supplementary Leverage ratio requirement.
The following tables set forth the capital tiers, total risk-weighted assets and underlying risk components, risk-based capital ratios, quarterly adjusted average total assets, Total Leverage Exposure and leverage ratios, assuming full implementation under the U.S. Basel III rules, for Citi as of September 30, 2017 and December 31, 2016.

At September 30, 2017, Citi’s constraining Common Equity Tier 1 Capital and Tier 1 Capital ratios were those derived under the Basel III Standardized Approach, whereas Citi’s binding Total Capital ratio was that resulting from application of the Basel III Advanced Approaches framework. Further, each of Citi’s risk-based capital ratios was constrained by the Basel III Advanced Approaches framework for all periods prior to June 30, 2017.
Citigroup Capital Components and Ratios Under Basel III (Full Implementation)
 September 30, 2017December 31, 2016
In millions of dollars, except ratiosAdvanced ApproachesStandardized ApproachAdvanced ApproachesStandardized Approach
Common Equity Tier 1 Capital$153,534
$153,534
$149,516
$149,516
Tier 1 Capital172,849
172,849
169,390
169,390
Total Capital (Tier 1 Capital + Tier 2 Capital)198,195
210,339
193,160
205,975
Total Risk-Weighted Assets1,169,142
1,182,918
1,189,680
1,147,956
   Credit Risk$782,223
$1,117,707
$796,399
$1,083,428
   Market Risk64,368
65,211
64,006
64,528
   Operational Risk322,551
—
329,275
—
Common Equity Tier 1 Capital ratio(1)(2)
13.13%12.98%12.57%13.02%
Tier 1 Capital ratio(1)(2)
14.78
14.61
14.24
14.76
Total Capital ratio(1)(2)
16.95
17.78
16.24
17.94
In millions of dollars, except ratiosSeptember 30, 2017December 31, 2016
Quarterly Adjusted Average Total Assets(3)
 $1,835,074
 $1,761,923
Total Leverage Exposure(4) 
 2,430,582
 2,345,391
Tier 1 Leverage ratio(2)
 9.42% 9.61%
Supplementary Leverage ratio(2)
 7.11
 7.22

(1)As of September 30, 2017, Citi’s reportable Common Equity Tier 1 Capital and Tier 1 Capital ratios were the lower derived under the Basel III Standardized Approach, whereas the reportable Total Capital ratio was the lower derived under the Basel III Advanced Approaches framework. As of December 31, 2016, Citi’s reportable Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios were the lower derived under the Basel III Advanced Approaches framework.
(2)Citi’s Basel III risk-based capital and leverage ratios and related components on a fully implemented basis,as of December 31, 2017 are non-GAAP financial measures.measures, which reflect full implementation of regulatory capital adjustments and deductions prior to the effective date of January 1, 2018.
(3)Tier 1 Leverage ratio denominator.
(4)Supplementary Leverage ratio denominator.



As indicated in the table above, Citigroup’s risk-based capital ratios at September 30, 2018 were in excess of the stated and effective minimum requirements under the U.S. Basel III rules. In addition, Citi was also “well capitalized” under current federal bank regulatory agency definitions as of September 30, 2018.

Common Equity Tier 1 Capital Ratio
Citi’s Common Equity Tier 1 Capital ratio was 13.0%11.7% at September 30, 2017,2018, compared to 13.1%12.1% at June 30, 20172018 and 12.6%12.4% at December 31, 2016.2017. The ratio declined quarter-over-quarter asdecreased from the favorable effects associated with quarterly net incomesecond quarter of $4.1 billion and a slight decline in total risk-weighted assets were more than offset by2018 primarily due to the return of $6.4 billion of capital to common shareholders, during the period. The growthincreases in credit and market risk-weighted assets, and adverse net movements in Accumulated other comprehensive income (AOCI), partially offset by quarterly net income of $4.6 billion. Citi’s Common Equity Tier 1 Capital ratio declined from year-end 2016 reflected continued enhancement of Common Equity Tier 1 Capital resulting from year-to-date net income of $12.1 billion and beneficial net movements in AOCI, offset in part by2017 primarily due to the return of approximately $10.8$12.6 billion of capital to common shareholders, during the first nine monthsincreases in credit and market risk-weighted assets, and adverse net movements in AOCI, partially offset by year-to-date net income of 2017.

$13.7 billion.


Components of Citigroup Capital Under Basel III (Full Implementation)
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2018		December 31, 2017
Common Equity Tier 1 Capital  
Citigroup common stockholders’ equity(1)
$208,565
$206,051
$178,153
$181,671
Add: Qualifying noncontrolling interests144
129
148
153
Regulatory Capital Adjustments and Deductions:  
Less: Accumulated net unrealized losses on cash flow hedges, net of tax(2)
(437)(560)(1,095)(698)
Less: Cumulative unrealized net loss related to changes in fair value of
financial liabilities attributable to own creditworthiness, net of tax(3)
(416)(61)(503)(721)
Less: Intangible assets:  
Goodwill, net of related DTLs(4)
21,532
20,858
21,891
22,052
Identifiable intangible assets other than MSRs, net of related DTLs
4,410
4,876
4,304
4,401
Less: Defined benefit pension plan net assets720
857
931
896
Less: DTAs arising from net operating loss, foreign tax credit and general
business credit carry-forwards(5)
20,068
21,337
12,345
13,072
Less: Excess over 10%/15% limitations for other DTAs, certain common stock investments,
and MSRs(5)(6)
9,298
9,357
Total Common Equity Tier 1 Capital (Standardized Approach and Advanced Approaches)$153,534
$149,516
$140,428
$142,822
Additional Tier 1 Capital  
Qualifying noncumulative perpetual preferred stock(1)
$19,069
$19,069
$18,851
$19,069
Qualifying trust preferred securities(7)
1,374
1,371
Qualifying trust preferred securities(6)
1,382
1,377
Qualifying noncontrolling interests62
28
56
61
Regulatory Capital Deductions:  
Less: Permitted ownership interests in covered funds(8)
1,128
533
Less: Minimum regulatory capital requirements of insurance underwriting subsidiaries(9)
62
61
Less: Permitted ownership interests in covered funds(7)
795
900
Less: Minimum regulatory capital requirements of insurance underwriting subsidiaries(8)
45
52
Total Additional Tier 1 Capital (Standardized Approach and Advanced Approaches)$19,315
$19,874
$19,449
$19,555
Total Tier 1 Capital (Common Equity Tier 1 Capital + Additional Tier 1 Capital)
(Standardized Approach and Advanced Approaches)
$172,849
$169,390
$159,877
$162,377
Tier 2 Capital  
Qualifying subordinated debt$23,578
$22,818
$22,948
$23,673
Qualifying trust preferred securities(10)
329
317
Qualifying trust preferred securities(9)
324
329
Qualifying noncontrolling interests47
36
48
50
Eligible allowance for credit losses(11)
13,598
13,475
Eligible allowance for credit losses(10)
13,656
13,612
Regulatory Capital Deduction:  
Less: Minimum regulatory capital requirements of insurance underwriting subsidiaries(9)
62
61
Less: Minimum regulatory capital requirements of insurance underwriting subsidiaries(8)
45
52
Total Tier 2 Capital (Standardized Approach)$37,490
$36,585
$36,931
$37,612
Total Capital (Tier 1 Capital + Tier 2 Capital) (Standardized Approach)$210,339
$205,975
$196,808
$199,989
Adjustment for excess of eligible credit reserves over expected credit losses(11)
$(12,144)$(12,815)
Adjustment for excess of eligible credit reserves over expected credit losses(10)
$(12,185)$(12,112)
Total Tier 2 Capital (Advanced Approaches)

$25,346
$23,770
$24,746
$25,500
Total Capital (Tier 1 Capital + Tier 2 Capital) (Advanced Approaches)$198,195
$193,160
$184,623
$187,877

(1)Issuance costs of $184 million related to noncumulative perpetual preferred stock outstanding at September 30, 20172018 and December 31, 20162017 are excluded from common stockholders’ equity and netted against such preferred stock in accordance with Federal Reserve Board regulatory reporting requirements, which differ from those under U.S. GAAP.
(2)Common Equity Tier 1 Capital is adjusted for accumulated net unrealized gains (losses) on cash flow hedges included in AOCI that relate to the hedging of items not recognized at fair value on the balance sheet.
(3)The cumulative impact of changes in Citigroup’s own creditworthiness in valuing liabilities for which the fair value option has been elected, and own-credit valuation adjustments on derivatives, are excluded from Common Equity Tier 1 Capital, in accordance with the U.S. Basel III rules.
(4)Includes goodwill “embedded” in the valuation of significant common stock investments in unconsolidated financial institutions.






Footnotes continue on the following page.




(5)Of Citi’s approximately $45.5$23.0 billion of net DTAs at September 30, 2017, approximately $17.62018, $11.4 billion were includable in Common Equity Tier 1 Capital pursuant to the U.S. Basel III rules, while approximately $27.9$11.6 billion were excluded. Excluded from Citi’s Common Equity Tier 1 Capital atas of September 30, 20172018 was in total approximately $29.3$12.3 billion of net DTAs arising from both net operating loss, foreign tax credit and general business credit carry-forwards, as well as temporary differences, which was reduced by approximately $1.4$0.7 billion of net DTLs primarily associated with goodwill and certain other intangible assets. Separately, under the U.S. Basel III rules, goodwill and these other intangible assets are deducted net of associated DTLs in arriving at Common Equity Tier 1 Capital. DTAs arising from net operating loss, foreign tax credit and general business credit carry-forwards are required to be entirely deducted from Common Equity Tier 1 Capital under full implementation of the U.S. Basel III rules; whereasrules. Commencing on December 31, 2017, Citi’s DTAs arising from temporary differences are deductedwere less than the 10% limitation under the U.S. Basel III rules and therefore not subject to deduction from Common Equity Tier 1 Capital, under these rules, if in excess of 10%/15% limitations.but are subject to risk-weighting at 250%.
(6)Assets subject to 10%/15% limitations include MSRs, DTAs arising from temporary differences and significant common stock investments in unconsolidated financial institutions. At September 30, 2017 and December 31, 2016, this deduction related only to DTAs arising from temporary differences that exceeded the 10% limitation. Accordingly, approximately $9.3 billion of DTAs arising from temporary differences were excluded from Citi’s Common Equity Tier 1 Capital at September 30, 2017. Changes to the U.S. corporate tax regime that impact the value of Citi’s DTAs arising from temporary differences, which exceed the then current amount deducted from Citi’s Common Equity Tier 1 Capital, would further reduce Citi’s regulatory capital to the extent of such excess after tax. For additional information regarding potential U.S. corporate tax reform, see “Risk Factors—Strategic Risks��� in Citigroup’s 2016 Annual Report on Form 10-K.
(7)Represents Citigroup Capital XIII trust preferred securities, which are permanently grandfathered as Tier 1 Capital under the U.S. Basel III rules.
(8)(7)Banking entities are required to be in compliance with the Volcker Rule of the Dodd-Frank Act, thatwhich prohibits conducting certain proprietary investment activities and limits their ownership of, and relationships with, covered funds. Accordingly, Citi is required by the Volcker Rule to deduct from Tier 1 Capital all permitted ownership interests in covered funds that were acquired after December 31, 2013.
(9)(8)50% of the minimum regulatory capital requirements of insurance underwriting subsidiaries must be deducted from each of Tier 1 Capital and Tier 2 Capital.
(10)(9)Represents the amount of non-grandfathered trust preferred securities eligible for inclusion in Tier 2 Capital under the U.S. Basel III rules, which will be fully phased-out of Tier 2 Capital by January 1, 2022.
(11)(10)Under the Standardized Approach, the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any excess allowance for credit losses being deducted in arriving at credit risk-weighted assets, which differs from the Advanced Approaches framework, in which eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent the excess reserves do not exceed 0.6% of credit risk-weighted assets. The total amount of eligible credit reserves in excess of expected credit losses that were eligible for inclusion in Tier 2 Capital, subject to limitation, under the Advanced Approaches framework was $1.5 billion and $0.7 billion at both September 30, 20172018 and December 31, 2016, respectively.2017.







Citigroup Capital Rollforward Under Basel III (Full Implementation)
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended  
  September 30, 2017		Three Months Ended 
 September 30, 2018		Nine Months Ended  
  September 30, 2018
Common Equity Tier 1 Capital, beginning of period$155,174
$149,516
$142,868
$142,822
Net income4,133
12,095
4,622
13,732
Common and preferred stock dividends declared(1,137)(2,648)(1,397)(3,637)
Net increase in treasury stock(5,487)(9,186)(5,265)(9,369)
Net change in common stock and additional paid-in capital98
(147)98
(184)
Net decrease in foreign currency translation adjustment net of hedges, net of tax218
2,179
Net change in unrealized losses on securities AFS, net of tax(66)631
Net increase in defined benefit plans liability adjustment, net of tax(29)(176)
Net increase in foreign currency translation losses net of hedges, net of tax(221)(1,968)
Net increase in unrealized losses on debt securities AFS, net of tax(605)(2,164)
Net decrease in defined benefit plans liability adjustment, net of tax26
415
Net change in adjustment related to changes in fair value of financial liabilities
attributable to own creditworthiness, net of tax
2
88
54
(59)
Net change in ASC 815—excluded component of fair value hedges10
(22)
Net change in goodwill, net of related DTLs57
(674)(82)161
Net decrease in identifiable intangible assets other than MSRs, net of related DTLs177
466
157
97
Net decrease in defined benefit pension plan net assets76
137
Net increase in defined benefit pension plan net assets(49)(35)
Net decrease in DTAs arising from net operating loss, foreign tax credit and general
business credit carry-forwards
764
1,269
206
727
Net change in excess over 10%/15% limitations for other DTAs, certain common stock
investments and MSRs
(447)59
Other1
(75)6
(88)
Net change in Common Equity Tier 1 Capital$(1,640)$4,018
Net decrease in Common Equity Tier 1 Capital$(2,440)$(2,394)
Common Equity Tier 1 Capital, end of period
(Standardized Approach and Advanced Approaches)
$153,534
$153,534
$140,428
$140,428
Additional Tier 1 Capital, beginning of period$19,955
$19,874
$19,134
$19,555
Net decrease in qualifying perpetual preferred stock—
(218)
Net increase in qualifying trust preferred securities—
3
2
5
Net increase in permitted ownership interests in covered funds(633)(595)
Net decrease in permitted ownership interests in covered funds314
105
Other(7)33
(1)2
Net decrease in Additional Tier 1 Capital$(640)$(559)
Net change in Additional Tier 1 Capital$315
$(106)
Tier 1 Capital, end of period
(Standardized Approach and Advanced Approaches)
$172,849
$172,849
$159,877
$159,877
Tier 2 Capital, beginning of period (Standardized Approach)$37,390
$36,585
$36,962
$37,612
Net change in qualifying subordinated debt(64)760
Net decrease in qualifying subordinated debt(286)(725)
Net increase in eligible allowance for credit losses165
123
253
44
Other(1)22
2
—
Net increase in Tier 2 Capital (Standardized Approach)$100
$905
Net decrease in Tier 2 Capital (Standardized Approach)$(31)$(681)
Tier 2 Capital, end of period (Standardized Approach)$37,490
$37,490
$36,931
$36,931
Total Capital, end of period (Standardized Approach)$210,339
$210,339
$196,808
$196,808
 
Tier 2 Capital, beginning of period (Advanced Approaches)$25,253
$23,770
$25,238
$25,500
Net change in qualifying subordinated debt(64)760
Net increase in excess of eligible credit reserves over expected credit losses158
794
Net decrease in qualifying subordinated debt(286)(725)
Net decrease in excess of eligible credit reserves over expected credit losses(208)(29)
Other(1)22
2
—
Net increase in Tier 2 Capital (Advanced Approaches)$93
$1,576
Net decrease in Tier 2 Capital (Advanced Approaches)$(492)$(754)
Tier 2 Capital, end of period (Advanced Approaches)$25,346
$25,346
$24,746
$24,746
Total Capital, end of period (Advanced Approaches)$198,195
$198,195
$184,623
$184,623



Citigroup Risk-Weighted Assets Rollforward (Basel III Standardized Approach with Full Implementation)Approach)
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended  
September 30, 2017		Three Months Ended 
 September 30, 2018		Nine Months Ended  
September 30, 2018
Total Risk-Weighted Assets, beginning of period$1,188,167
$1,147,956
$1,176,863
$1,155,099
Changes in Credit Risk-Weighted Assets  
Net increase in general credit risk exposures(1)
1,511
15,154
2,730
2,715
Net increase in repo-style transactions(2)8,430
15,417
3,761
5,621
Net decrease in securitization exposures(4,129)(6,183)(1,078)(232)
Net increase in equity exposures1,003
1,839
1,139
2,679
Net increase in over-the-counter (OTC) derivatives(3)2,827
1,746
7,489
18,213
Net change in other exposures(2)(4)
(1,736)3,715
(321)1,999
Net change in off-balance sheet exposures(731)2,591
Net increase in off-balance sheet exposures(5)
266
6,502
Net increase in Credit Risk-Weighted Assets$7,175
$34,279
$13,986
$37,497
Changes in Market Risk-Weighted Assets  
Net change in risk levels$(1,727)$14,163
Net decrease due to model and methodology updates(10,697)(13,480)
Net change in Market Risk-Weighted Assets$(12,424)$683
Net increase in risk levels(6)
$5,673
$11,603
Net change due to model and methodology updates(7)
401
(7,276)
Net increase in Market Risk-Weighted Assets$6,074
$4,327
Total Risk-Weighted Assets, end of period$1,182,918
$1,182,918
$1,196,923
$1,196,923

(1)General credit risk exposures include cash and balances due from depository institutions, securities, and loans and leases. General credit risk exposures increased during the three and nine months ended September 30, 2018, driven by growth in corporate loans.
(2)Repo-style transactions include repurchase and reverse repurchase transactions as well as securities borrowing and securities lending transactions.
(3)OTC derivatives increased during the three and nine months ended September 30, 2018, primarily due to increased notional amounts for bilateral trades.
(4)Other exposures include cleared transactions, unsettled transactions and other assets. Other exposures increased during the nine months ended September 30, 2018, primarily due to additional DTAs arising from temporary differences, which are subject to risk-weighting at 250%.
(5)Off-balance sheet exposures increased during the nine months ended September 30, 2018, primarily due to an increase in commitments to extend credit that will drive future corporate loan growth.
(6)Risk levels increased during the three months ended September 30, 2018 primarily due to an increase in positions subject to specific risk charges, partially offset by decreases in exposure levels subject to Stressed Value at Risk. Risk levels increased during the nine months ended September 30, 2018 primarily due to an increase in positions subject to specific risk charges.
(7)Risk-weighted assets decreased during the nine months ended September 30, 2018 due to changes in model inputs regarding volatility and the correlation between market risk factors, as well as methodology changes for standard specific risk charges.



Citigroup Risk-Weighted Assets Rollforward (Basel III Advanced Approaches with Full Implementation)Approaches)
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended  
  September 30, 2017		Three Months Ended 
 September 30, 2018		Nine Months Ended  
  September 30, 2018
Total Risk-Weighted Assets, beginning of period$1,183,399
$1,189,680
$1,147,865
$1,152,644
Changes in Credit Risk-Weighted Assets  
Net change in retail exposures(1)1,898
(6,757)2,293
(14,218)
Net decrease in wholesale exposures(6,362)(5,946)
Net change in wholesale exposures(2)
(2,519)5,756
Net increase in repo-style transactions(3)4,658
4,660
98
1,394
Net decrease in securitization exposures(4,362)(6,477)
Net change in securitization exposures(637)387
Net increase in equity exposures931
1,619
1,320
2,878
Net change in over-the-counter (OTC) derivatives(4)1,088
(5,009)(189)1,754
Net change in derivatives CVA(5)1,017
(83)(1,415)1,783
Net increase in other exposures(1)(6)
2,099
4,615
1,594
3,046
Net decrease in supervisory 6% multiplier(2)
(3)(798)
Net change in Credit Risk-Weighted Assets$964
$(14,176)
Net increase in supervisory 6% multiplier(7)
118
60
Net increase in Credit Risk-Weighted Assets$663
$2,840
Changes in Market Risk-Weighted Assets  
Net change in risk levels$(2,075)$13,842
Net decrease due to model and methodology updates(10,697)(13,480)
Net change in Market Risk-Weighted Assets$(12,772)$362
Net decrease in Operational Risk-Weighted Assets$(2,449)$(6,724)
Net increase in risk levels(8)
$5,159
$10,920
Net change due to model and methodology updates(9)
401
(7,276)
Net increase in Market Risk-Weighted Assets$5,560
$3,644
Net change in Operational Risk-Weighted Assets(10)
$1,100
$(3,940)
Total Risk-Weighted Assets, end of period$1,169,142
$1,169,142
$1,155,188
$1,155,188

(1)Retail exposures increased during the three months ended September 30, 2018, primarily due to new accounts and spending for qualifying revolving (cards) exposures. Retail exposures decreased during the nine months ended September 30, 2018, primarily due to net reductions in qualifying revolving (cards) exposures attributable to seasonal holiday spending repayments, as well as residential mortgage loan sales and repayments.
(2)Wholesale exposures decreased during the three months ended September 30, 2018 primarily due to decreases in commercial loans. Wholesale exposures increased during the nine months ended September 30, 2018, primarily due to increases in commercial loans and loan commitments.
(3)Repo-style transactions include repurchase and reverse repurchase transactions as well as securities borrowing and securities lending transactions.
(4)OTC derivatives increased during the nine months ended September 30, 2018, primarily due to increases in potential future exposure and fair value.
(5)Derivatives CVA decreased during the three months ended September 30, 2018, primarily due to decreases in exposures. Derivatives CVA increased during the nine months ended September 30, 2018, primarily due to increased exposures and changes in credit spreads.
(6)Other exposures include cleared transactions, unsettled transactions, assets other than those reportable in specific exposure categories and non-material portfolios. Other exposures increased during the three months ended September 30, 2018, primarily due to an increase in other assets. Other exposures increased during the nine months ended September 30, 2018, primarily due to an increase in other assets and additional DTAs arising from temporary differences, which are subject to risk-weighting at 250%.
(2)(7)Supervisory 6% multiplier does not apply to derivatives CVA.



(8)Risk levels increased during the three months ended September 30, 2018 primarily due to an increase in positions subject to specific risk charges, partially offset by decreases in exposure levels subject to Stressed Value at Risk. Risk levels increased during the nine months ended September 30, 2018 primarily due to an increase in positions subject to specific risk charges.
(9)Risk-weighted assets decreased during the nine months ended September 30, 2018 due to changes in model inputs regarding volatility and the correlation between market risk factors, as well as methodology changes for standard specific risk charges.
(10)Operational risk-weighted assets increased during the three months ended September 30, 2018, and decreased during the nine months ended September 30, 2018, primarily due to changes in operational loss severity and frequency.

TotalAs set forth in the table above, total risk-weighted assets under the Basel III Standardized Approach increased from year-end 2016 substantially2017 due to higher credit and market risk-weighted assets. The increase in credit risk-weighted assets was primarily resulting fromdue to increased OTC derivatives, corporate loan growthcommitments and increasedan increase in repo-style transaction activity.transactions.
Total risk-weighted assets under the Basel III Advanced Approaches decreasedincreased from year-end 2016, driven2017, as higher credit and market risk-weighted assets were partially offset by substantially lower credit anda decrease in operational risk-weighted assets. The decreaseincrease in credit risk-weighted assets was primarily due to annual updatesincreases in commercial loans and loan commitments, increases in equity exposures, and additional temporary difference DTAs subject to model parameters for wholesale exposures,risk weighting, partially offset
by a decline in retail exposures resulting fromdue to reductions in qualifying revolving (cards) exposures attributable to seasonal holiday spending repayments as well as residential mortgage loan sales and repayments as well as divestitures of certain legacy assets, and, separately, certain securitization exposures becoming subject to deduction from Tier 1 Capital under the Volcker Rule of the Dodd-Frank Act, which was partially offset by an increaserepayments. The decline in repo-style transaction activity. Operationaloperational risk-weighted assets decreased from year-end 2016was primarily due to assessed improvements in the business environment and risk controls, as well as changes in operational loss severity and frequency.
Market risk-weighted assets increased under both the Basel III Standardized Approach and Basel III Advanced Approaches primarily due to increases in positions subject to specific risk charges, partially offset by changes in model inputs regarding volatility and the correlation between market risk factors, as well as methodology changes for standard specific risk charges.



Supplementary Leverage Ratio
As set forth in the table below, Citigroup’s Supplementary Leverage ratio was 7.1%6.5% for the third quarter of 2017,2018, compared to 7.2%6.6% for both the second quarter of 20172018 and 6.7% for the fourth quarter of 2016.2017. The decline in the ratio quarter-over-quarter was principally driven by the return of $6.4 billion of capital to common shareholders as well as adverse net movements in AOCI, partially offset by quarterly net income of $4.6 billion. The ratio decreased from the fourth quarter of 2017, principally driven by the return of capital to common shareholders, adverse net
movements in AOCI and an increase in Total Leverage Exposure (TLE) primarily due to growth in average on-balance sheet assets and off-balance sheet commitments, partially offset by quarterly net income of $4.1 billion. The ratio decreased from the fourth quarter of 2016, as year-to-date net income of $12.1 billion and beneficial net movements
in AOCI were more than offset by the return of $10.8 billion of capital to common shareholders and an increase in Total Leverage Exposure primarily due to growth in average on-balance sheet assets.income.
The following table sets forth Citi’s Supplementary Leverage ratio and related components assuming full implementation under the U.S. Basel III rules, for the three months ended September 30, 20172018 and December 31, 2016.2017.



Citigroup Basel III Supplementary Leverage Ratio and Related Components (Full Implementation)
In millions of dollars, except ratiosSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Tier 1 Capital$172,849
$169,390
$159,877
$162,377
Total Leverage Exposure (TLE)  
On-balance sheet assets(1)
$1,892,292
$1,819,802
$1,922,804
$1,909,699
Certain off-balance sheet exposures:(2)
  
Potential future exposure on derivative contracts216,819
211,009
191,557
191,555
Effective notional of sold credit derivatives, net(3)
68,569
64,366
48,047
59,207
Counterparty credit risk for repo-style transactions(4)
25,513
22,002
22,732
27,005
Unconditionally cancellable commitments67,945
66,663
69,794
67,644
Other off-balance sheet exposures216,662
219,428
245,370
218,754
Total of certain off-balance sheet exposures$595,508
$583,468
$577,500
$564,165
Less: Tier 1 Capital deductions57,218
57,879
40,311
41,373
Total Leverage Exposure$2,430,582
$2,345,391
$2,459,993
$2,432,491
Supplementary Leverage ratio7.11%7.22%6.50%6.68%

(1)Represents the daily average of on-balance sheet assets for the quarter.
(2)Represents the average of certain off-balance sheet exposures calculated as of the last day of each month in the quarter.
(3)Under the U.S. Basel III rules, banking organizations are required to include in TLE the effective notional amount of sold credit derivatives, with netting of exposures permitted if certain conditions are met.
(4)Repo-style transactions include repurchase orand reverse repurchase transactions andas well as securities borrowing orand securities lending transactions.

Citibank’s Supplementary Leverage ratio, assuming full implementation under


Capital Resources of Citigroup’s Subsidiary U.S. Depository Institutions
Citigroup’s subsidiary U.S. depository institutions are also subject to regulatory capital standards issued by their respective primary federal bank regulatory agencies, which are similar to the standards of the Federal Reserve Board.
During 2018, Citi’s primary subsidiary U.S. Basel III rules, was 6.7% for the third quarter of 2017, compareddepository institution, Citibank, N.A. (Citibank), is subject to 6.6% for both the second quarter of 2017 and fourth quarter of 2016. The growth in the ratio quarter-over-quarter and from year-end 2016 was principally driven by an increase ineffective minimum Common Equity Tier 1 Capital, attributable largelyTier 1 Capital and Total Capital ratios, inclusive of the 75% phase-in of the 2.5% Capital Conservation Buffer, of 6.375%, 7.875% and 9.875%, respectively. Citibank’s effective minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios during 2017, inclusive of the 50% phase-in of
the 2.5% Capital Conservation Buffer, were 5.75%, 7.25% and 9.25%, respectively. Citibank is required to maintain stated minimum Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios of 4.5%, 6.0% and 8.0%, respectively.
The following tables set forth the capital tiers, total risk-weighted assets and underlying risk components, risk-based capital ratios, quarterly adjusted average total assets, Total Leverage Exposure and leverage ratios for Citibank, Citi’s primary subsidiary U.S. depository institution, as of September 30, 2018 and December 31, 2017.

Citibank Capital Components and Ratios
 September 30, 2018December 31, 2017
In millions of dollars, except ratiosAdvanced ApproachesStandardized ApproachAdvanced ApproachesStandardized Approach
Common Equity Tier 1 Capital$128,097
$128,097
$122,848
$122,848
Tier 1 Capital130,222
130,222
124,952
124,952
Total Capital (Tier 1 Capital + Tier 2 Capital)(1)
143,471
154,081
138,008
148,946
Total Risk-Weighted Assets946,235
1,043,721
965,435
1,024,502
   Credit Risk$667,549
$1,007,205
$674,659
$980,324
   Market Risk36,141
36,516
43,300
44,178
   Operational Risk242,545
—
247,476
—
Common Equity Tier 1 Capital ratio(2)(3)(4)
13.54%12.27%12.72%11.99%
Tier 1 Capital ratio(2)(3)(4)
13.76
12.48
12.94
12.20
Total Capital ratio(2)(3)(4)
15.16
14.76
14.29
14.54
In millions of dollars, except ratiosSeptember 30, 2018December 31, 2017
Quarterly Adjusted Average Total Assets(5)
 $1,396,471
 $1,401,187
Total Leverage Exposure(6) 
 1,920,675
 1,900,641
Tier 1 Leverage ratio(2)(4)
 9.33% 8.92%
Supplementary Leverage ratio(2)(4)
 6.78
 6.57

(1)Under the Advanced Approaches framework, eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent that the excess reserves do not exceed 0.6% of credit risk-weighted assets, which differs from the Standardized Approach in which the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any excess allowance for credit losses being deducted in arriving at credit risk-weighted assets.
(2)Citibank’s risk-based capital and leverage ratios and related components as of December 31, 2017 are non-GAAP financial measures, which reflect full implementation of regulatory capital adjustments and deductions prior to the effective date of January 1, 2018.
(3)As of September 30, 2018, Citibank’s reportable Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital ratios were the lower derived under the Basel III Standardized Approach. As of December 31, 2017, Citibank’s reportable Common Equity Tier 1 Capital and Tier 1 Capital ratios were the lower derived under the Basel III Standardized Approach, whereas the reportable Total Capital ratio was the lower derived under the Basel III Advanced Approaches framework.
(4)Citibank must maintain minimum Common Equity Tier 1 Capital, Tier 1 Capital, Total Capital and Tier 1 Leverage ratios of 6.5%, 8.0%, 10.0% and 5.0%, respectively, to be considered “well capitalized” under the revised Prompt Corrective Action (PCA) regulations applicable to insured depository institutions as established by the U.S. Basel III rules. Effective January 1, 2018, Citibank must also maintain a minimum Supplementary Leverage ratio of 6.0% to be considered “well capitalized.” For additional information, see “Capital Resources—Current Regulatory Capital Standards—Prompt Corrective Action Framework” in Citigroup’s 2017 Annual Report on Form 10-K.
(5)Tier 1 Leverage ratio denominator.
(6)Supplementary Leverage ratio denominator.

As indicated in the table above, Citibank’s capital ratios at September 30, 2018 were in excess of the stated and effective minimum requirements under the U.S.


Basel III rules. In addition, Citibank was also “well capitalized” as of September 30, 2018 under the revised PCA regulations.



Impact of Changes on Citigroup and Citibank Capital Ratios
The following tables present the estimated sensitivity of Citigroup’s and Citibank’s capital ratios to changes of $100 million in Common Equity Tier 1 Capital, Tier 1 Capital and Total Capital (numerator), and changes of $1 billion in
Advanced Approaches and Standardized Approach risk-weighted assets and quarterly adjusted average total assets, as well as Total Leverage Exposure (denominator), as of September 30, 2018. This information is provided for the
purpose of analyzing the impact that a change in Citigroup’s or Citibank’s financial position or results of operations could have on these ratios. These sensitivities only consider a single change to either a component of capital, risk-weighted assets, quarterly adjusted average total assets or Total Leverage Exposure. Accordingly, an event that affects more than one factor may have a larger basis point impact than is reflected in these tables.


Impact of Changes on Citigroup and Citibank Risk-Based Capital Ratios
 
Common Equity
Tier 1 Capital ratio
Tier 1 Capital ratioTotal Capital ratio
In basis points
Impact of
$100 million
change in
Common Equity
Tier 1 Capital
Impact of
$1 billion
change in risk-
weighted assets
Impact of
$100 million
change in
Tier 1 Capital
Impact of
$1 billion
change in risk-
weighted assets
Impact of
$100 million
change in
Total Capital
Impact of
$1 billion
change in risk-
weighted assets
Citigroup      
Advanced Approaches0.91.10.91.20.91.4
Standardized Approach0.81.00.81.10.81.4
Citibank      
Advanced Approaches1.11.41.11.51.11.6
Standardized Approach1.01.21.01.21.01.4

Impact of Changes on Citigroup and Citibank Leverage Ratios
 Tier 1 Leverage ratioSupplementary Leverage ratio
In basis points
Impact of
$100 million
change in
Tier 1 Capital
Impact of
$1 billion
change in quarterly adjusted average total assets
Impact of
$100 million
change in
Tier 1 Capital
Impact of
$1 billion
change in Total Leverage Exposure
Citigroup0.50.50.40.3
Citibank0.70.70.50.4

Citigroup Broker-Dealer Subsidiaries
At September 30, 2018, Citigroup Global Markets Inc., a U.S. broker-dealer registered with the SEC that is an indirect wholly owned subsidiary of Citigroup, had net income, partiallycapital, computed in accordance with the SEC’s net capital rule, of $10.5 billion, which exceeded the minimum requirement by $8.1 billion.
Moreover, Citigroup Global Markets Limited, a broker-dealer registered with the United Kingdom’s Prudential Regulation Authority (PRA) that is also an indirect wholly owned subsidiary of Citigroup, had total capital of $20.9 billion at September 30, 2018, which exceeded the PRA's minimum regulatory capital requirements.
In addition, certain of Citi’s other broker-dealer subsidiaries are subject to regulation in the countries in which they do business, including requirements to maintain specified levels of net capital or its equivalent. Citigroup’s other broker-dealer subsidiaries were in compliance with their regulatory capital requirements at September 30, 2018.


Regulatory Capital Standards Developments

Leverage Ratio Treatment of Client Cleared Derivatives
In October 2018, the Basel Committee on Banking Supervision (Basel Committee) issued a consultative document seeking views as to whether a targeted and limited revision of the leverage ratio exposure measure is warranted with regard to the treatment of client cleared derivatives. In the U.S., the Basel Committee’s leverage ratio framework and leverage ratio exposure measure are most closely aligned with the Supplementary Leverage Ratio and Total Leverage Exposure, respectively. Under the Basel Committee’s leverage ratio framework, which was last updated in December 2017, the leverage ratio exposure measure is generally not adjusted for physical or financial collateral, guarantees or other credit risk mitigation techniques. However, the Basel Committee consultative document proposes two alternative treatments for client cleared derivatives that would reduce the leverage ratio exposure measure, to varying degrees, in recognition of the beneficial effects of margin requirements and overcollateralization, as applicable.
One of the options under consideration would allow amounts of cash and non-cash initial margin that are received from the client to offset the potential future exposure of derivatives centrally cleared on the client’s behalf. Another option would amend the currently specified treatment of client cleared derivatives to align it with the measurement as determined per the Basel Committee’s standardized approach for measuring counterparty credit risk exposures, as used for risk-based capital requirements. This option would permit both cash and non-cash forms of initial margin and variation margin received from the client to offset replacement cost and potential future exposure for client cleared derivatives only.
The U.S. banking agencies may revise the treatment of client cleared derivatives under the Supplementary Leverage Ratio in the future, based upon any revisions adopted by cash dividends paid by Citibank to its parent, Citicorp, and which were subsequently remitted to Citigroup.the Basel Committee.





Tangible Common Equity, Book Value Per Share, Tangible Book Value Per Share and Returns on Equity
Tangible common equity (TCE), as defined by Citi, represents common stockholders’ equity less goodwill and identifiable intangible assets (other than MSRs). Other companies may calculate TCE in a different manner. TCE, tangible book value per share and returns on average TCE are non-GAAP financial measures.
 

In millions of dollars or shares, except per share amountsSeptember 30,
2017		December 31,
2016		September 30,
2018		December 31,
2017
Total Citigroup stockholders’ equity$227,634
$225,120
$197,004
$200,740
Less: Preferred stock19,253
19,253
19,035
19,253
Common stockholders’ equity$208,381
$205,867
$177,969
$181,487
Less:  
Goodwill22,345
21,659
22,187
22,256
Identifiable intangible assets (other than MSRs)4,732
5,114
4,598
4,588
Goodwill and identifiable intangible assets (other than MSRs) related to
assets held-for-sale
48
72
Goodwill and identifiable intangible assets (other than MSRs) related to
assets held-for-sale (HFS)
—
32
Tangible common equity (TCE)$181,256
$179,022
$151,184
$154,611
Common shares outstanding (CSO)2,644.0
2,772.4
2,442.1
2,569.9
Book value per share (common equity/CSO)$78.81
$74.26
$72.88
$70.62
Tangible book value per share (TCE/CSO)68.55
64.57
61.91
60.16


In millions of dollarsThree Months Ended September 30, 2017Three Months Ended September 30, 2016Nine Months Ended September 30, 2017Nine Months Ended September 30, 2016Three Months Ended September 30, 2018Three Months Ended September 30, 2017Nine Months Ended September 30, 2018Nine Months Ended September 30, 2017
Net income available to common shareholders$3,861
$3,615
$11,202
$10,582
$4,352
$3,861
$12,872
$11,202
Average common stockholders’ equity(1)$209,764
$212,321
$208,787
$209,850
$179,459
$209,764
$180,772
$208,787
Average TCE$182,333
$184,492
$181,271
$182,914
$152,712
$182,333
$153,909
$181,271
Less: Average net DTAs excluded from Common Equity Tier 1 Capital(1)
28,085
27,921
28,522
28,954
Average TCE, excluding average net DTAs excluded from
Common Equity Tier 1 Capital
$154,248
$156,571
$152,749
$153,960
Return on average common stockholders’ equity7.3%6.8%7.2%6.7%9.6%7.3%9.5%7.2%
Return on average TCE (ROTCE)(2)
8.4
7.8
8.3
7.7
11.3
8.4
11.2
8.3
Return on average TCE, excluding average net DTAs excluded from Common Equity Tier 1 Capital9.9
9.2
9.8
9.2

(1)Represents average net DTAs excluded in arrivingAverage common stockholders’ equity for the 2018 periods includes the $22.6 billion impact from Tax Reform recorded at Common Equity Tier 1 Capital under full implementationthe end of the U.S. Basel III rules.fourth quarter of 2017.
(2)ROTCE represents annualized net income available to common shareholders as a percentage of average TCE.



Managing Global Risk Table of Contents

MANAGING GLOBAL RISK 
4739

CREDIT RISK(1)
 
4839

Consumer Credit 
4839

Corporate Credit 
5546

Additional Consumer and Corporate Credit Details 
5748

 Loans Outstanding 
5748

       Details of Credit Loss Experience 
5949

       Allowance for Loan Losses 6050
       Non-Accrual Loans and Assets and Renegotiated Loans 
6151

LIQUIDITY RISK 
6555

High-Quality Liquid Assets (HQLA) 
6555

Loans 6656
Deposits 6656
Long-Term Debt 6757
Secured Funding Transactions and Short-Term Borrowings 6959
Liquidity Coverage Ratio (LCR) 6959
Credit Ratings 7060
MARKET RISK(1)
 
7262

Market Risk of Non-Trading Portfolios 
7262

Market Risk of Trading Portfolios 
8373

COUNTRY RISK 
8575


(1)For additional information regarding certain credit risk, market risk and other quantitative and qualitative information, refer to Citi’s Pillar 3 Basel III Advanced Approaches Disclosures, as required by the rules of the Federal Reserve Board, on Citi’s Investor Relations website.



MANAGING GLOBAL RISK

For Citi, effective risk management is of primary importance to its overall operations. Accordingly, Citi’s risk management process has been designed to identify, monitor, evaluate and manage the principal risks it assumes in conducting its activities. Specifically, the activities that Citi engages in, and the risks those activities generate, must be consistent with Citi’s mission and value proposition, the key principles that guide it and Citi's risk appetite.
For more information on Citi’s management of global risk, including its three lines of defense, see “Managing Global Risk” in Citi’s 20162017 Annual Report on Form 10-K.
 





CREDIT RISK

For additional information on credit risk, including Citi’s credit risk management, measurement and stress testing, see “Credit Risk” and “Risk Factors” in Citi’s 20162017 Annual Report on Form 10-K.

CONSUMER CREDIT
Citi provides traditional retail banking, including commercial banking, and credit card products in 19 countries and jurisdictions through North America GCB, Latin America GCB and Asia GCB. The retail banking products include consumer mortgages, home equity, personal and commercial loans and lines of credit and similar related products with a focus on lending to prime customers. Citi uses its risk appetite framework to define its lending parameters. In addition, Citi
uses proprietary scoring models for new customer approvals.
As stated in “Global Consumer Banking” above, GCB’s overall strategy is to leverage Citi’s global footprint and be the preeminentpre-eminent bank for the affluent and emerging affluent consumers in large urban centers. In credit cards and in certain retail markets (including commercial banking), Citi serves customers in a somewhat broader set of segments and geographies. GCB’s commercial banking business primarily focuses on small to mid-sized businesses.mid-size businesses and also serves larger middle market companies in certain regions.

Consumer Credit Portfolio
The following tables showtable shows Citi’s quarterly end-of-period consumer loans:(1) 


In billions of dollars3Q’172Q’171Q’174Q’163Q’163Q’174Q’171Q’182Q’183Q’18
Retail banking:    
Mortgages$81.4
$81.4
$81.2
$79.4
$81.4
$81.4
$81.7
$82.1
$80.5
$80.9
Commercial banking35.5
34.8
33.9
32.0
33.2
35.5
36.3
36.8
36.5
37.2
Personal and other27.3
27.2
26.3
24.9
27.0
27.3
27.9
28.5
28.1
28.7
Total retail banking$144.2
$143.4
$141.4
$136.3
$141.6
$144.2
$145.9
$147.4
$145.1
$146.8
Cards:  
Citi-branded cards$110.7
$109.9
$105.7
$108.3
$103.9
$110.7
$115.7
$110.6
$112.3
$112.8
Citi retail services45.9
45.2
44.2
47.3
43.9
45.9
49.2
46.0
48.6
49.4
Total cards$156.6
$155.1
$149.9
$155.6
$147.8
$156.6
$164.9
$156.6
$160.9
$162.2
Total GCB
$300.8
$298.5
$291.3
$291.9
$289.4
$300.8
$310.8
$304.0
$306.0
$309.0
GCB regional distribution:
  
North America62%62%62%64%62%62%63%61%63%62%
Latin America9
9
9
8
8
9
8
9
8
9
Asia(2)
29
29
29
28
30
29
29
30
29
29
Total GCB
100%100%100%100%100%100%100%100%100%100%
Corporate/Other(3)
$24.8
$26.8
$29.3
$33.2
$39.0
$24.8
$22.9
$21.1
$17.6
$16.5
Total consumer loans$325.6
$325.3
$320.6
$325.1
$328.4
$325.6
$333.7
$325.1
$323.6
$325.5

(1)End-of-period loans include interest and fees on credit cards.
(2)
Asia includes loans and leases in certain EMEA countries for all periods presented.
(3)
Primarily consists of legacy assets, principally North America consumer mortgages.



For information on changes to Citi’s end-of-period consumer loans, see “Liquidity Risk—Loans” below.





Overall Consumer Credit Trends
The following charts show the quarterly trends in delinquencies and net credit losses across both retail banking, including commercial banking, and cards for total GCB and by region.

Global Consumer Banking
legenda21.jpg
a3q17gcba01.jpga3q18gcba06.jpg

North America GCB
legenda22.jpg
a3q17na.jpg
Latin America
legenda07.jpg
a3q17latam.jpg
Asia(1)
legenda07.jpg
a3q17asia.jpga3q18nagcba02.jpg

(1)
Asia includes GCB activities in certain EMEA countries for all periods presented.
North America GCBprovides mortgages, home equity loans, personal loans and commercial banking products through Citi’s retail banking network and card products through Citi-branded cards and Citi retail services businesses. The retail bank is concentrated in six major metropolitan cities in the United States (for additional information on the U.S. retail bank, see “North America GCB” above).
As of September 30, 2017,2018, approximately 70%71% of North America GCB consumer loans consisted of Citi-branded and Citi retail services cards, which generally drives the overall credit performance of North America GCB, including the credit performance year-over-year as of the third quarter of 2017 (for(for additional information on North America GCB’s cards portfolios, including delinquency and net credit loss rates, see “Credit Card Trends” below). Quarter-over-quarter,
As shown in the chart above, the quarter-over-quarter net credit loss rate decreased while the 90+ days past due delinquenciesdelinquency rate slightly increased, slightly, primarily due todriven by seasonality in theboth cards portfolios. The year-over-year net credit loss rate increased quarter-over-quarter, primarilydecreased due to an episodic charge-offscharge-off in the commercial portfolio which were offset by related loan loss reserve releases.in the prior-year period, while the delinquency rate was broadly stable.


Latin America GCB
legenda19.jpga3q18latamgcba02.jpg
Latin America GCBoperates in Mexico through Citibanamex, one of Mexico’s largest banks, and provides credit cards, consumer mortgages, personal loans and commercial banking products. Latin America GCB serves a more mass market segment in Mexico and focuses on developing multi-product relationships with customers.
As set forth in the chart above, the 90+ days past due
delinquencies modestly improved delinquency rate decreased quarter-over-quarter and year-over-year, primarily due to improvements in mortgages and the commercial portfolio. The quarter-over-quarter and year-over year net credit loss rate increased, in Latin America GCB year-over-year as of the third quarter of 2017. The increaseprimarily driven by an episodic charge-off in the net creditcommercial portfolio, which was offset by a related loan loss rate primarily reflected seasoning. The delinquency and net credit loss rates remained stable quarter-over-quarter.reserve release.

Asia(1) GCB
legenda23.jpg
a3q18asiagcba01.jpg

(1)
Asia includes GCB activities in certain EMEA countries for all periods presented.

Asia GCBoperates in 17 countries in Asia and EMEA and provides credit cards, consumer mortgages, personal loans and commercial banking products.
As shown in the chart above, the 90+ days past due delinquency and net credit loss rates were largelybroadly stable in Asia GCB year-over-yearquarter-over-quarter and quarter-over-quarteryear-over-year as of the third quarter of 2017.2018. This stability reflects the strong credit profiles in Asia GCB’s target customer segments. In addition, regulatory changes in many markets in Asia over the past few years have resulted in stable or improved portfolio credit quality, despite weaker macroeconomic conditions in several countries.quality.
For additional information on cost of credit, loan delinquency and other information for Citi’s consumer loan portfolios, see each respective business’s results of operations above and Note 13 to the Consolidated Financial Statements.





Credit Card Trends
The following charts show the quarterly trends in delinquencies and net credit losses for total GCB cards, Citi’s North America Citi-branded cards and Citi retail services portfolios as well as for Citi’s Latin America and Asia Citi-branded cards portfolios.

TotalGlobal Cards
legenda19.jpg
a3q17totalcards.jpga3q18cards.jpg

North America Citi-Branded Cards
legenda16.jpg
a3q17nacards.jpga3q18nacitibrandcards.jpg

North America GCB’s Citi-branded cards portfolio issues proprietary and co-branded cards. As shown in the chart above, quarter-over-quarter the 90+ days past due delinquency rate in Citi-branded cards was stable year-over-year and quarter-over-quarter. Thewhile the net credit loss rate increased year-over-yeardecreased primarily due to seasonality. The year-over-year increases in both the impact of the Costcodelinquency and net credit loss rates were driven primarily by portfolio acquisition and seasoning, and decreased quarter-over-quarter mostly due to seasonality.seasoning.





North America Citi Retail Services
legenda18.jpga3q18nacitiretailcards.jpg
a3q17naretail.jpg
Citi retail services partners directly with more than 20 retailers and dealers to offer private-label and co-branded consumer and commercial cards. Citi retail services’ target market is focused on select industry segments such as home improvement, specialty retail, consumer electronics and fuel. Citi retail services continually evaluates opportunities to add partners within target industries that have strong loyalty, lending or payment programs and growth potential.
As shown in the chart above, Citi retail services’ 90+ days past due delinquency and net credit loss ratesrate increased year-over-year, primarilyquarter-over-quarter, mainly due to seasoning and softness inseasonality, while the collections rates experienced once an account reaches mid-stage delinquency. The net credit loss rate decreased, quarter-over-quarterprimarily due to seasonality whileand the delinquencyimpact of recently acquired portfolios. The year-over-year net credit loss rate increase quarter-over-quarterdecrease was primarily driven by seasonality and softening in collections.the impact of recently acquired portfolios.

Latin America Citi-Branded Cards
legenda20.jpg
a3q17latamcards.jpga3q18latamcards.jpg

Latin America GCBissues proprietary and co-branded cards. As set forth in the chart above, the quarter-over-quarter net credit loss rate increased year-over-year and quarter-over-quarter primarily due to seasoning. Thewhile the 90+ days past due delinquency rate increased year-over-year alsodecreased, both primarily driven by seasoning, while the decrease quarter-over-quarter wasseasonality. The year-over-year net credit loss and delinquency rates increased, primarily due to seasonality.portfolio seasoning.



Asia Citi-Branded Cards(1)
legenda17.jpg
a3q17asiacards.jpga3q18asiacardsa01.jpg

(1)
Asia includes loans and leases in certain EMEA countries for all periods presented.

Asia GCBissues proprietary and co-branded cards. As set forth in the chart above, the 90+ days past due delinquency and net credit loss rates haverate has remained broadly stable, driven by the mature and well-diversified cards portfolios. The increase in the year-over-year net credit loss rate was primarily driven by the conversion of an acquired portfolio in Australia. The quarter-over-quarter decrease in the net credit loss rate was primarily related to improvements in this portfolio.
For additional information on cost of credit, delinquency and other information for Citi’s cards portfolios, see each respective business’s results of operations above and Note 13 to the Consolidated Financial Statements.




 
North America Cards FICO Distribution
The following tables show the current FICO score distributions for Citi’s North America Citi-branded cards and Citi retail services portfolios based on end-of-period receivables. FICO scores are updated monthly for substantially all of the portfolio and on a quarterly basis for the remaining portfolio.

Citi-Branded
  
FICO distributionSeptember 30, 2017December 31, 2016
  > 72062%64%
   660 - 72027
26
   620 - 6607
6
  < 6204
4
Total100%100%
   
FICO distributionSeptember 30, 2018June 30, 2018
September 30,
2017
  > 76042%43%40%
   680 - 76041
40
41
  < 68017
17
19
Total100%100%100%

Citi Retail Services
  
FICO distributionSeptember 30, 2017December 31, 2016
   > 72041%42%
   660 - 72035
35
   620 - 66013
13
  < 62011
10
Total100%100%
   
FICO distributionSeptember 30, 2018June 30, 2018September 30, 2017
   > 76024%24%23%
   680 - 76043
43
43
  < 68033
33
34
Total100%100%100%

As indicated byThe FICO distribution of both portfolios was stable compared to the tables above, the FICO distributions for Citi-branded cardsprevious quarter and Citi retail services cardsprevious year. The portfolios were largely unchanged versus year-end 2016.continued to demonstrate strong underlying credit quality. For additional information on FICO scores, see Note 13 to the Consolidated Financial Statements.










North America Consumer Mortgage Lending
Citi’s North America consumer mortgage portfolio consists of both residential first mortgages and home equity loans. The following table shows the outstanding quarterly end-of-period loans for Citi’s North America residential first mortgage and home equity loan portfolios:
In billions of dollars3Q’172Q’171Q’174Q’163Q’163Q’174Q’171Q’182Q’183Q’18
GCB:
  
Residential firsts$40.1
$40.2
$40.3
$40.2
$40.1
$40.1
$40.1
$40.1
$40.3
$40.7
Home equity4.1
4.1
4.0
4.0
3.9
4.1
4.2
4.1
4.1
3.9
Total GCB
$44.2
$44.3
$44.3
$44.2
$44.0
$44.2
$44.3
$44.2
$44.4
$44.6
Corporate/Other:
  
Residential firsts$10.1
$11.0
$12.3
$13.4
$14.8
$10.1
$9.3
$8.1
$7.6
$7.0
Home equity11.5
12.4
13.4
15.0
16.1
11.5
10.6
9.9
8.8
8.2
Total Corporate/
Other
$21.6
$23.4
$25.7
$28.4
$30.9
$21.6
$19.9
$18.0
$16.4
$15.2
Total Citigroup—
North America
$65.8
$67.7
$70.0
$72.6
$74.9
$65.8
$64.2
$62.2
$60.8
$59.8

For additional information on delinquency and net credit loss trends in Citi’s consumer mortgage portfolio, see “Additional Consumer Credit Details” below.

Home Equity Loans—Revolving HELOCs
As set forth in the table above, Citi had $15.6$12.1 billion of home equity loans as of September 30, 2017,2018, of which $3.6$2.5 billion were fixed-rate home equity loans and $12.0$9.6 billion were extended under home equity lines of credit (Revolving HELOCs). Fixed-rate home equity loans are fully amortizing. Revolving HELOCs allow for amounts to be drawn for a period of time with the payment of interest only until the end of the draw period, when the outstanding amount is converted to an amortizing loan, or “reset” (the interest-only payment feature during the revolving period is standard for this product across the industry). Upon reset, these borrowers will be required to pay both interest, usually at a variable rate, and principal that amortizes typically over 20 years, rather than the standard 30-year amortization.
Of the Revolving HELOCs at September 30, 2017, $6.82018, $6.2 billion had reset (compared to $6.6$6.4 billion at June 30, 2017)2018) and $5.2$3.4 billion were still within their revolving period thatand had not reset (compared to $6.0$3.7 billion at June 30, 2017)2018). The following chart indicates the FICO and combined loan-to-value (CLTV) characteristics of Citi’s Revolving HELOCs portfolio and the year in which they reset:


 
North America Home Equity Lines of Credit Amortization – Citigroup
Total ENR by Reset Year
In billions of dollars as of September 30, 20172018
a3q18consumergraph.jpg
nahelca3q17.jpgNote: Totals may not sum due to rounding.

Approximately 57%64% of Citi’s total Revolving HELOCs portfolio had reset as of September 30, 20172018 (compared to 53%63% as of June 30, 2017)2018). Of the remaining Revolving HELOCs portfolio, approximately 11%2% will commence amortization during the remainder of 2017.2018. Citi’s customers with Revolving HELOCs that reset could experience “payment shock” due to the higher required payments on the loans. Citi currently estimates that the monthly loan payment for its Revolving HELOCs that reset during the remainder of 20172018 could increase on average by approximately $355,$270, or 101%98%. Increases in interest rates could further increase these payments given the variable nature of the interest rates on these loans post-reset. Borrowers’ high loan-to-value positions, as well as the cost and availability of refinancing options, could limit borrowers’ ability to refinance their Revolving HELOCs as these loans begincontinue to reset.
Approximately 5.9%5.5% of the Revolving HELOCs that have reset as of September 30, 20172018 were 30+ days past due, compared to 3.9%3.7% of the total outstanding home equity loan portfolio (amortizing and non-amortizing). This compared to 5.9%5.3% and 3.7%3.6%, respectively, as of June 30, 2017.2018. As newly amortizing loans continue to season, the delinquency rate of Citi’s total home equity loan portfolio could increase. In addition,Although interest rates have steadily increased over the past 12 months, resets to date have generally occurred during a period of historically low interest rates, which Citi believes has likely reduced the overall “payment shock” to the borrower.
Citi monitors this reset risk closely and will continue to consider any potential impact in determining its allowance for loan loss reserves. In addition, management continues to review and take additional actions to offset potential reset risk, such as establishing a borrower outreach program to provide reset risk education and proactively working with high-risk borrowers through a specialized single point of contact unit.




    



Additional Consumer Credit Details

Consumer Loan Delinquency Amounts and Ratios
EOP
loans(1)
90+ days past due(2)
30–89 days past due(2)
EOP
loans(1)
90+ days past due(2)
30–89 days past due(2)
In millions of dollars,
except EOP loan amounts in billions		September 30,
2017		September 30,
2017		June 30,
2017		September 30,
2016		September 30,
2017		June 30,
2017		September 30,
2016		September 30,
2018		September 30,
2018		June 30,
2018		September 30,
2017		September 30,
2018		June 30,
2018		September 30,
2017
Global Consumer Banking(3)(4)
        
Total$300.8
$2,279
$2,183
$2,166
$2,763
$2,498
$2,553
$309.0
$2,404
$2,345
$2,279
$2,890
$2,558
$2,763
Ratio 0.76%0.73%0.75%0.92%0.84%0.88% 0.78%0.77%0.76%0.94%0.84%0.92%
Retail banking          
Total$144.2
$489
$477
$579
$805
$747
$722
$146.8
$508
$500
$489
$857
$754
$805
Ratio 0.34%0.33%0.41%0.56%0.52%0.51% 0.35%0.35%0.34%0.59%0.52%0.56%
North America55.7
167
155
256
270
191
198
56.3
188
179
167
320
252
270
Ratio 0.30%0.28%0.47%0.49%0.35%0.37% 0.34%0.33%0.30%0.58%0.46%0.49%
Latin America21.0
151
150
160
244
216
196
21.0
126
132
151
235
183
244
Ratio 0.72%0.71%0.86%1.16%1.03%1.05% 0.60%0.66%0.72%1.12%0.91%1.16%
Asia(5)
67.5
171
172
163
291
340
328
69.5
194
189
171
302
319
291
Ratio 0.25%0.26%0.24%0.43%0.51%0.48% 0.28%0.27%0.25%0.43%0.46%0.43%
Cards          
Total$156.6
$1,790
$1,706
$1,587
$1,958
$1,751
$1,831
$162.2
$1,896
$1,845
$1,790
$2,033
$1,804
$1,958
Ratio 1.14%1.10%1.07%1.25%1.13%1.24% 1.17%1.15%1.14%1.25%1.12%1.25%
North America—Citi-branded86.3
668
659
607
705
619
710
North America—Citi-branded
88.4
707
712
668
722
627
705
Ratio 0.77%0.77%0.75%0.82%0.72%0.87% 0.80%0.81%0.77%0.82%0.71%0.82%
North America—Citi retail services45.9
772
693
664
836
730
750
North America—Citi retail services
49.4
832
781
772
890
761
836
Ratio 1.68%1.53%1.51%1.82%1.62%1.71% 1.68%1.61%1.68%1.80%1.57%1.82%
Latin America5.6
159
161
131
163
151
131
5.8
169
160
159
170
156
163
Ratio 2.84%2.93%2.67%2.91%2.75%2.67% 2.91%2.96%2.84%2.93%2.89%2.91%
Asia(5)
18.8
191
193
185
254
251
240
18.6
188
192
191
251
260
254
Ratio 1.02%1.03%1.05%1.35%1.34%1.36% 1.01%1.02%1.02%1.35%1.38%1.35%
Corporate/Other—Consumer(7)(6)
          
Total$24.8
$605
$601
$857
$643
$554
$849
$16.5
$401
$415
$605
$422
$355
$643
Ratio 2.57%2.37%2.29%2.74%2.18%2.27% 2.57%2.49%2.57%2.71%2.13%2.74%
International1.7
57
63
164
47
44
135
—
—
—
57
—
—
47
Ratio 3.35%3.50%2.98%2.76%2.44%2.45% —%—%3.35%—%—%2.76%
North America23.1
548
538
693
596
510
714
16.5
401
415
548
422
355
596
Ratio 2.51%2.28%2.17%2.73%2.16%2.24% 2.57%2.49%2.51%2.71%2.13%2.73%
Total Citigroup$325.6
$2,884
$2,784
$3,023
$3,406
$3,052
$3,402
$325.5
$2,805
$2,760
$2,884
$3,312
$2,913
$3,406
Ratio 0.89%0.86%0.93%1.05%0.94%1.04% 0.87%0.86%0.89%1.02%0.90%1.05%
(1)End-of-period (EOP) loans include interest and fees on credit cards.
(2)The ratios of 90+ days past due and 30–89 days past due are calculated based on EOP loans, net of unearned income.
(3)
The 90+ days past due balances for North America—America—Citi-brandedand North America—America—Citi retail services are generally still accruing interest. Citigroup’s policy is generally to accrue interest on credit card loans until 180 days past due, unless notification of bankruptcy filing has been received earlier.
(4)
The 90+ days past due and 30–89 days past due and related ratios for GCB North America GCB exclude U.S. mortgage loans that are guaranteed by U.S. government-sponsored entities since the potential loss predominantly resides within the U.S. government-sponsored entities. The amounts excluded for loans 90+ days past due and (EOP loans) were $235 million ($0.7 billion), $244 million ($0.7 billion) and $289 million ($0.7 billion), $295 million ($0.8 billion) and $305 million ($0.7 billion) at as of September 30, 2017,2018, June 30, 2017,2018 and September 30, 2016,2017, respectively. The amounts excluded for loans 30–89 days past due and (EOP loans have the same adjustment as above)loans) were $82 million ($0.7 billion), $87 million ($0.7 billion), and $79 million $84 million and $58 million at($0.7 billion) as of September 30, 2017,2018, June 30, 20172018 and September 30, 2016,2017, respectively.
(5)
Asia includes delinquencies and loans in certain EMEA countries for all periods presented.
(6)
The loans 90+ days past due and 30–89 days past due and related ratios for Corporate/Other—North America consumer exclude U.S. mortgage loans that are guaranteed by U.S. government-sponsored entitiesagencies since the potential loss predominantly resides withinwith the U.S. government-sponsored entities.agencies. The amounts excluded for loans 90+ days past due (and EOPand (EOP loans) for each period were $0.4 billion ($0.8 billion), $0.4 billion ($0.9 billion) and $0.7 billion ($1.2 billion), $0.7 billion ($1.3 billion) and $1.0 billion ($1.5 billion) at as of September 30, 2017,2018, June 30, 20172018 and September 30, 2016,2017, respectively. The amounts excluded for loans 30–89 days past due and (EOP loans have the same adjustment as above)loans) for each period were $0.1 billion $0.2($0.8 billion), $0.1 billion ($0.9 billion), and $0.1 billion at($1.2 billion) as of September 30, 2018, June 30, 2018 and September 30, 2017, June 30, 2017 and September 30, 2016, respectively.


(7)
The September 30, 2017, June 30, 2017 and September 30, 2016 loans 90+ days past due and 30–89 days past due and related ratios for North America exclude $6 million, $6 million and $9 million, respectively, of loans that are carried at fair value.

Consumer Loan Net Credit Losses and Ratios
Average
loans(1)
Net credit losses(2)(3)
Average
loans(1)
Net credit losses(2)(3)
In millions of dollars, except average loan amounts in billions3Q172Q173Q163Q182Q183Q17
Global Consumer Banking     
Total$299.7
$1,704
$1,615
$1,349
$306.8
$1,714
$1,726
$1,704
Ratio 2.26%2.20 %1.87% 2.22%2.28 %2.26%
Retail banking    
Total$144.3
$300
$244
$257
$145.9
$243
$228
$300
Ratio 0.82%0.69 %0.72% 0.66%0.63 %0.82%
North America55.7
88
39
52
56.0
32
32
88
Ratio 0.63%0.28 %0.38% 0.23%0.23 %0.63%
Latin America21.2
143
151
132
20.7
153
138
143
Ratio 2.68%3.00 %2.75% 2.93%2.75 %2.68%
Asia(4)
67.4
69
54
73
69.2
58
58
69
Ratio 0.41%0.33 %0.43% 0.33%0.33 %0.41%
Cards    
Total$155.4
$1,404
$1,371
$1,092
$160.9
$1,471
$1,498
$1,404
Ratio 3.58%3.63 %2.99% 3.63%3.81 %3.58%
North America—Citi-branded85.4
611
611
448
North America—Citi-branded
87.8
644
657
611
Ratio 2.84%2.94 %2.25% 2.91%3.04 %2.84%
North America—Retail services45.6
540
531
427
North America—Citi retail services
49.0
566
589
540
Ratio 4.70%4.79 %3.90% 4.58%5.07 %4.70%
Latin America5.6
152
126
122
5.6
154
140
152
Ratio 10.77%9.54 %9.52% 10.91%10.40 %10.77%
Asia(4)
18.8
101
103
95
18.5
107
112
101
Ratio 2.13%2.25 %2.15% 2.29%2.38 %2.13%
Corporate/Other—Consumer(3)
    
Total$25.8
$52
$18
$134
$17.0
$12
$(20)$52
Ratio 0.80%0.26 %1.31% 0.28%(0.41)%0.80%
International1.9
25
24
82
—
—
19
25
Ratio 5.22%5.07 %6.04% —%6.93 %5.22%
North America23.9
27
(6)52
17.0
12
(39)27
Ratio 0.45%(0.09)%0.58% 0.28%(0.85)%0.45%
Other(5)
0.1
(22)—
—
—
—
—
(22)
Total Citigroup$325.6
$1,734
$1,633
$1,483
$323.8
$1,726
$1,706
$1,734
Ratio 2.11%2.04 %1.80% 2.11%2.12 %2.11%
(1)Average loans include interest and fees on credit cards.
(2)The ratios of net credit losses are calculated based on average loans, net of unearned income.
(3)
In October 2016, Citi entered into agreementsan agreement to sell Citi’s Brazil and Argentina consumer banking businesses and classified these businesses as held-for-sale (HFS).business. The sale of the Argentina consumer banking business was completed at the end of the firstfourth quarter of 2017. As a result of HFS accounting treatment, approximately $38 million and $37 million of net credit losses (NCLs) werewas recorded as a reduction in revenue (Other revenue) during the second quarter of 2017 and the third quarter of 2017, respectively.2017. Accordingly, these NCLs are not included in this table. Loans classified as HFS are excluded from this table as they are recorded in Other assets.assets.
(4)
Asia includes NCLs and average loans in certain EMEA countries for all periods presented.
(5)The third quarter of 2017 NCLs representreflected a recovery related to legacy assets.





CORPORATE CREDIT
Consistent with its overall strategy, Citi’s corporate clients are typically large, multi-nationalmultinational corporations that value the depth and breadth of Citi’s global network. Citi aims to establish relationships with these clients that encompass multiple products, consistent with client needs, including cash management and trade services, foreign exchange, lending, capital markets and M&A advisory.

Corporate Credit Portfolio
The following table sets forth Citi’s corporate credit portfolio within ICG (excluding private bank), before consideration of collateral or hedges, by remaining tenor for the periods indicated:
At September 30, 2017At June 30, 2017At December 31, 2016At September 30, 2018June 30, 2018December 31, 2017
In billions of dollars
Due
within
1 year
Greater
than 1 year
but within
5 years
Greater
than
5 years
Total
exposure
Due
within
1 year		Greater
than 1 year
but within
5 years		Greater
than
5 years		Total
exposure
Due
within
1 year
Greater
than 1 year
but within
5 years
Greater
than
5 years
Total
exposure
Due
within
1 year
Greater
than 1 year
but within
5 years
Greater
than
5 years
Total
exposure
Due
within
1 year
Greater
than 1 year
but within
5 years
Greater
than
5 years
Total
exposure
Due
within
1 year
Greater
than 1 year
but within
5 years
Greater
than
5 years
Total
exposure
Direct outstandings (on-balance sheet)(1)
$124
$96
$23
$243
$122
$94
$23
$239
$109
$94
$22
$225
$131
$103
$20
$254
$133
$103
$19
$255
$127
$96
$22
$245
Unfunded lending commitments (off-balance sheet)(2)
104
219
20
$343
103
222
22
347
103
218
23
344
115
253
25
393
127
235
20
382
111
222
20
353
Total exposure$228
$315
$43
$586
$225
$316
$45
$586
$212
$312
$45
$569
$246
$356
$45
$647
$260
$338
$39
$637
$238
$318
$42
$598

(1)Includes drawn loans, overdrafts, bankers’ acceptances and leases.
(2)Includes unused commitments to lend, letters of credit and financial guarantees.

Portfolio Mix—Geography, Counterparty and Industry
Citi’s corporate credit portfolio is diverse across geography and counterparty. The following table shows the percentage of this portfolio by region based on Citi’s internal management geography:
September 30,
2017		June 30,
2017		December 31,
2016		September 30,
2018		June 30,
2018		December 31,
2017
North America55%55%55%55%54%54%
EMEA26
26
26
27
27
27
Asia12
12
12
11
12
12
Latin America7
7
7
7
7
7
Total100%100%100%100%100%100%

The maintenance of accurate and consistent risk ratings across the corporate credit portfolio facilitates the comparison of credit exposure across all lines of business, geographic regions and products. Counterparty risk ratings reflect an estimated probability of default for a counterparty and are derived primarily through the use of validated statistical models, scorecard models and external agency ratings (under defined circumstances), in combination with consideration of factors specific to the obligor or market, such as management experience, competitive position,
regulatory environment and commodity prices. Facility risk ratings are assigned that reflect the probability of default of
the obligor and factors that affect the loss-given-default of the facility, such as support or collateral. Internal obligor ratings that generally correspond to BBB and above are

considered investment grade, while those below are considered non-investment grade.
Citigroup also has incorporated environmental factors like climate risk assessment and reporting criteria for certain obligors, as necessary. Factors evaluated include consideration of climate risk to an
obligor’s business and physical assets and, when relevant, consideration of cost-effective options to reduce greenhouse gas emissions.


The following table presents the corporate credit portfolio by facility risk rating as a percentage of the total corporate credit portfolio:

Total exposureTotal exposure
September 30,
2017		June 30,
2017		December 31,
2016		September 30,
2018		June 30,
2018		December 31,
2017
AAA/AA/A49%49%48%48%49%49%
BBB34
34
34
34
34
34
BB/B16
16
16
17
16
16
CCC or below1
1
2
1
1
1
Total100%100%100%100%100%100%

Note: Total exposure includes direct outstandings and unfunded lending commitments.


Citi’s corporate credit portfolio is also diversified by industry. The following table shows the allocation of Citi’s total corporate credit portfolio by industry:
Total exposureTotal exposure
September 30,
2017		June 30,
2017		December 31,
2016		September 30,
2018		June 30,
2018		December 31,
2017
Transportation and industrial22%21%22%21%22%22%
Consumer retail and health16
17
16
16
16
16
Technology, media and telecom11
11
12
14
13
12
Power, chemicals, metals and mining10
10
11
11
10
10
Energy and commodities(1)
8
9
9
8
8
8
Banks/broker-dealers/finance companies8
7
6
8
8
8
Real estate7
8
7
8
7
8
Public sector5
5
5
Insurance and special purpose entities5
5
5
4
4
5
Public sector5
5
5
Hedge funds4
5
5
4
4
4
Other industries4
2
2
1
3
2
Total100%100%100%100%100%100%

Note: Total exposure includes direct outstandings and unfunded lending
commitments.
(1) In addition to this exposure, Citi has energy-related exposure within
the “Public sector” (e.g., energy-related state-owned entities) and
“Transportation and industrial” sector (e.g., off-shore drilling entities)
included in the table above. As of September 30, 2017, Citi’s total
exposure to these energy-related entities remained largely consistent
with the prior quarter, at approximately $6 billion, of which
approximately $3 billion consisted of direct outstanding funded loans.

Credit Risk Mitigation
As part of its overall risk management activities, Citigroup uses credit derivatives and other risk mitigants to hedge portions of the credit risk in its corporate credit portfolio, in addition to outright asset sales. The results of the mark-to-market and any realized gains or losses on credit derivatives are reflected primarily in Other revenue onin the Consolidated Statement of Income.
At September 30, 2017,2018, June 30, 20172018 and December 31, 2016, $22.22017, $26.9 billion, $23.7$27.4 billion and $29.5$16.3 billion, respectively, of the corporate credit portfolio was economically hedged. Citigroup’s expected loss model used in the calculation of its loan loss reserve does not include the favorable impact of credit derivatives and other mitigants that are marked-to-market.marked to market. In addition, the reported amounts of direct outstandings and unfunded lending commitments in the tables above do not reflect the impact of these hedging transactions. The credit protection was economically hedging underlying corporate credit portfolio exposures with the following risk rating distribution:

Rating of Hedged Exposure
September 30,
2017		June 30,
2017		December 31,
2016		September 30,
2018		June 30,
2018		December 31,
2017
AAA/AA/A16%16%16%34%34%23%
BBB48
47
49
47
46
43
BB/B33
34
31
17
18
31
CCC or below3
3
4
2
2
3
Total100%100%100%100%100%100%

The credit protection was economically hedging underlying corporate credit portfolio exposures with the following industry distribution:

Industry of Hedged Exposure
September 30,
2017		June 30,
2017		December 31,
2016		September 30,
2018		June 30,
2018		December 31,
2017
Transportation and industrial27%27%29%25%25%27%
Technology, media and telecom15
15
12
Consumer retail and health14
15
10
Power, chemicals, metals and mining14
14
14
Energy and commodities17
20
20
11
11
15
Consumer retail and health12
11
10
Technology, media and telecom14
13
13
Power, chemicals, metals and mining12
13
12
Public sector8
6
5
7
7
12
Banks/broker-dealers5
5
4
Banks/broker-dealers/finance companies

5
4
6
Insurance and special purpose entities2
2
3
4
5
2
Other industries3
3
4
5
4
2
Total100%100%100%100%100%100%



ADDITIONAL CONSUMER AND CORPORATE CREDIT DETAILS

Loans Outstanding
3rd Qtr.2nd Qtr.1st Qtr.4th Qtr.3rd Qtr.3rd Qtr.2nd Qtr.1st Qtr.4th Qtr.3rd Qtr.
In millions of dollars201720172016201820182017
Consumer loans


In U.S. offices

Mortgage and real estate(1)
$67,131
$69,022
$71,170
$72,957
$75,057
$61,048
$61,692
$63,412
$65,467
$67,131
Installment, revolving credit and other3,191
3,190
3,252
3,395
3,465
3,515
3,759
3,306
3,398
3,191
Cards131,476
130,181
125,799
132,654
124,637
137,051
135,968
131,081
139,006
131,476
Commercial and industrial7,619
7,404
7,434
7,159
6,989
7,686
7,459
7,493
7,840
7,619
Total$209,417
$209,797
$207,655
$216,165
$210,148
$209,300
$208,878
$205,292
$215,711
$209,417
In offices outside the U.S.  
Mortgage and real estate(1)
$43,723
$43,821
$43,822
$42,803
$45,751
$43,714
$43,056
$44,833
$44,081
$43,723
Installment, revolving credit and other26,153
26,480
26,014
24,887
28,217
27,899
27,254
27,651
26,556
26,153
Cards25,443
25,376
24,497
23,783
25,833
24,971
24,712
25,993
26,257
25,443
Commercial and industrial20,015
18,956
17,728
16,568
17,498
18,821
18,966
20,526
20,238
20,015
Lease financing77
81
83
81
113
52
55
62
76
77
Total$115,411
$114,714
$112,144
$108,122
$117,412
$115,457
$114,043
$119,065
$117,208
$115,411
Total consumer loans$324,828
$324,511
$319,799
$324,287
$327,560
$324,757
$322,921
$324,357
$332,919
$324,828
Unearned income(2)
748
750
757
776
812
712
711
727
737
748
Consumer loans, net of unearned income$325,576
$325,261
$320,556
$325,063
$328,372
$325,469
$323,632
$325,084
$333,656
$325,576
Corporate loans

In U.S. offices

Commercial and industrial$51,679
$50,341
$49,845
$49,586
$50,156
$51,365
$53,260
$54,005
$51,319
$51,679
Loans to financial institutions37,203
36,953
35,734
35,517
35,801
Financial institutions46,255
42,867
40,472
39,128
37,203
Mortgage and real estate(1)
43,274
42,041
40,052
38,691
41,078
47,629
46,310
45,581
44,683
43,274
Installment, revolving credit and other32,464
31,611
32,212
34,501
32,571
32,201
32,663
32,866
33,181
32,464
Lease financing1,493
1,467
1,511
1,518
1,532
1,445
1,445
1,463
1,470
1,493
Total$166,113
$162,413
$159,354
$159,813
$161,138
$178,895
$176,545
$174,387
$169,781
$166,113
In offices outside the U.S.

Commercial and industrial$93,107
$91,131
$87,258
$81,882
$84,492
$98,281
$98,068
$101,368
$93,750
$93,107
Loans to financial institutions33,050
34,844
33,763
26,886
27,305
Financial institutions37,851
38,312
35,659
35,273
33,050
Mortgage and real estate(1)
6,383
6,783
5,527
5,363
5,595
7,344
7,261
7,543
7,309
6,383
Installment, revolving credit and other23,830
19,200
16,576
19,965
25,462
22,827
22,755
23,338
22,638
23,830
Lease financing216
234
253
251
243
131
139
167
190
216
Governments and official institutions5,628
5,518
5,970
5,850
6,506
4,898
5,270
6,170
5,200
5,628
Total$162,214
$157,710
$149,347
$140,197
$149,603
$171,332
$171,805
$174,245
$164,360
$162,214
Total corporate loans$328,327
$320,123
$308,701
$300,010
$310,741
$350,227
$348,350
$348,632
$334,141
$328,327
Unearned income(3)
(720)(689)(662)(704)(678)(787)(802)(778)(763)(720)
Corporate loans, net of unearned income$327,607
$319,434
$308,039
$299,306
$310,063
$349,440
$347,548
$347,854
$333,378
$327,607
Total loans—net of unearned income$653,183
$644,695
$628,595
$624,369
$638,435
$674,909
$671,180
$672,938
$667,034
$653,183
Allowance for loan losses—on drawn exposures(12,366)(12,025)(12,030)(12,060)(12,439)(12,336)(12,126)(12,354)(12,355)(12,366)
Total loans—net of unearned income
and allowance for credit losses		$640,817
$632,670
$616,565
$612,309
$625,996
$662,573
$659,054
$660,584
$654,679
$640,817
Allowance for loan losses as a percentage of total loans—
net of unearned income(4)
1.91%1.88%1.93%1.94%1.97%1.84%1.81%1.85%1.87%1.91%
Allowance for consumer loan losses as a percentage of
total consumer loans—net of unearned income(4)
3.04%2.93%2.96%2.88%2.95%3.07%3.03%3.09%2.96%3.04%
Allowance for corporate loan losses as a percentage of
total corporate loans—net of unearned income(4)
0.77%0.80%0.83%0.91%0.90%0.68%0.68%0.67%0.76%0.77%
(1)Loans secured primarily by real estate.
(2)Unearned income on consumer loans primarily represents unamortized origination fees and costs, premiums and discounts.
(3)Unearned income on corporate loans primarily represents interest received in advance, but not yet earned, on loans originated on a discounted basis.
(4)All periods exclude loans that are carried at fair value.


Details of Credit Loss Experience
3rd Qtr.2nd Qtr.1st Qtr.4th Qtr.3rd Qtr.3rd Qtr.2nd Qtr.1st Qtr.4th Qtr.3rd Qtr.
In millions of dollars201720172016201820182017
Allowance for loan losses at beginning of period$12,025
$12,030
$12,060
$12,439
$12,304
$12,126
$12,354
$12,355
$12,366
$12,025
Provision for loan losses  
Consumer$2,142
$1,620
$1,816
$1,659
$1,815
$1,869
$1,764
$1,881
$1,785
$2,142
Corporate4
46
(141)68
(69)37
31
(78)231
4
Total$2,146
$1,666
$1,675
$1,727
$1,746
$1,906
$1,795
$1,803
$2,016
$2,146
Gross credit losses  
Consumer  
In U.S. offices$1,429
$1,437
$1,444
$1,343
$1,181
$1,462
$1,490
$1,542
$1,426
$1,429
In offices outside the U.S. 642
597
597
605
702
596
599
615
611
642
Corporate  
In U.S. offices15
72
48
32
29
15
5
65
21
15
In offices outside the U.S. 34
24
55
103
36
21
15
74
221
34
Total$2,120
$2,130
$2,144
$2,083
$1,948
$2,094
$2,109
$2,296
$2,279
$2,120
Credit recoveries(1)
  
Consumer  
In U.S. offices$167
$266
$242
$235
$227
$212
$255
$238
$228
$167
In offices outside the U.S. 170
135
127
137
173
120
128
148
151
170
Corporate  
In U.S. offices2
15
2
2
16
1
5
13
4
2
In offices outside the U.S. 4
4
64
13
7
5
17
30
16
4
Total$343
$420
$435
$387
$423
$338
$405
$429
$399
$343
Net credit losses  
In U.S. offices$1,275
$1,228
$1,248
$1,138
$967
$1,264
$1,235
$1,356
$1,215
$1,275
In offices outside the U.S. 502
482
461
558
558
492
469
511
665
502
Total$1,777
$1,710
$1,709
$1,696
$1,525
$1,756
$1,704
$1,867
$1,880
$1,777
Other—net(2)(3)(4)(5)(6)(7)
$(28)$39
$4
$(410)$(86)$60
$(319)$63
$(147)$(28)
Allowance for loan losses at end of period$12,366
$12,025
$12,030
$12,060
$12,439
$12,336
$12,126
$12,354
$12,355
$12,366
Allowance for loan losses as a percentage of total loans(8)
1.91%1.88%1.93%1.94%1.97%1.84%1.81%1.85%1.87%1.91%
Allowance for unfunded lending commitments(9)
$1,232
$1,406
$1,377
$1,418
$1,388
$1,321
$1,278
$1,290
$1,258
$1,232
Total allowance for loan losses and unfunded lending commitments$13,598
$13,431
$13,407
$13,478
$13,827
$13,657
$13,404
$13,644
$13,613
$13,598
Net consumer credit losses$1,734
$1,633
$1,672
$1,576
$1,483
$1,726
$1,706
$1,771
$1,658
$1,734
As a percentage of average consumer loans2.11%2.04%2.11%1.95%1.80%2.11%2.12%2.19%2.02%2.11%
Net corporate credit losses$43
$77
$37
$120
$42
Net corporate credit losses (recoveries)$30
$(2)$96
$222
$43
As a percentage of average corporate loans0.05%0.10%0.05%0.16%0.05%0.03%—%0.11%0.27%0.05%
Allowance by type at end of period(10)
  
Consumer$9,892
$9,515
$9,495
$9,358
$9,673
$9,997
$9,796
$10,039
$9,869
$9,892
Corporate2,474
2,510
2,535
2,702
2,766
2,339
2,330
2,315
2,486
2,474
Total$12,366
$12,025
$12,030
$12,060
$12,439
$12,336
$12,126
$12,354
$12,355
$12,366
(1)Recoveries have been reduced by certain collection costs that are incurred only if collection efforts are successful.
(2)Includes all adjustments to the allowance for credit losses, such as changes in the allowance from acquisitions, dispositions, securitizations, FX translation, purchase accounting adjustments, etc.
(3)The third quarter of 2018 includes a reduction of approximately $5 million related to the sale or transfers to held-for-sale (HFS) of various loan portfolios, including a reduction of $2 million related to the transfers of a real estate loan portfolio to HFS. Additionally, the third quarter includes an increase of approximately $62 million related to FX translation.
(4)The second quarter of 2018 includes a reduction of approximately $137 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $33 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the second quarter includes a decrease of approximately $164 million related to FX translation.
(5)The first quarter of 2018 includes a reduction of approximately $55 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $53 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the first quarter includes an increase of approximately $118 million related to FX translation.


(6)The fourth quarter of 2017 includes a reduction of approximately $47 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $22 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the fourth quarter includes a decrease of approximately $106 million related to FX translation.
(7)The third quarter of 2017 includes a reduction of approximately $34 million related to the sale or transfer to held-for-sale (HFS)HFS of various loan portfolios, including a reduction of $28 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the third quarter includes an increase of approximately $7 million related to FX translation.
(4)The second quarter of 2017 includes a reduction of approximately $19 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $19 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the second quarter includes an increase of approximately $50 million related to FX translation.
(5)The first quarter of 2017 includes a reduction of approximately $161 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $37 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the first quarter includes an increase of approximately $164 million related to FX translation.


(6)The fourth quarter of 2016 includes a reduction of approximately $267 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $3 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the fourth quarter includes a reduction of approximately $141 million related to FX translation.
(7)The third quarter of 2016 includes a reduction of approximately $58 million related to the sale or transfer to HFS of various loan portfolios, including a reduction of $50 million related to the transfer of a real estate loan portfolio to HFS. Additionally, the third quarter includes a reduction of approximately $46 million related to FX translation.
(8)September 30, 2017,2018, June 30, 2017,2018, March 31, 2017,2018, December 31, 20162017 and September 30, 20162017 exclude $4.3 billion, $4.2 billion, $4.0$3.0 billion, $3.5$4.5 billion, $4.9 billion and $4.0$4.3 billion, respectively, of loans which are carried at fair value.
(9)
Represents additional credit reserves recorded as Other liabilities on the Consolidated Balance Sheet.
(10)Allowance for loan losses represents management’s best estimate of probable losses inherent in the portfolio, as well as probable losses related to large individually evaluated impaired loans and troubled debt restructurings. See “Significant Accounting Policies and Significant Estimates” and Note 1 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K. Attribution of the allowance is made for analytical purposes only and the entire allowance is available to absorb probable credit losses inherent in the overall portfolio.


Allowance for Loan Losses
The following tables detail information on Citi’s allowance for loan losses, loans and coverage ratios:
September 30, 2017September 30, 2018
In billions of dollars
Allowance for
loan losses
Loans, net of
unearned income
Allowance as a
percentage of loans(1)
Allowance for
loan losses
Loans, net of
unearned income
Allowance as a
percentage of loans(1)
North America cards(2)
$6.0
$132.2
4.5%$6.4
$137.9
4.6%
North America mortgages(3)
0.8
65.8
1.2
0.5
59.8
0.8
North America other
0.2
13.0
1.5
0.3
12.8
2.3
International cards1.4
24.9
5.6
1.4
24.4
5.7
International other(4)
1.5
89.7
1.7
1.4
90.6
1.5
Total consumer$9.9
$325.6
3.0%$10.0
$325.5
3.1%
Total corporate2.5
327.6
0.8
2.3
349.4
0.7
Total Citigroup$12.4
$653.2
1.9%$12.3
$674.9
1.8%
(1)Allowance as a percentage of loans excludes loans that are carried at fair value.
(2)Includes both Citi-branded cards and Citi retail services. The $6.0$6.4 billion of loan loss reserves represented approximately 16 months of coincident net credit loss coverage.
(3)
Of the $0.8$0.5 billion, approximately $0.7$0.4 billion was allocated to North America mortgages in Corporate/Other. Of the $0.8$0.5 billion, approximately $0.3$0.2 billion and $0.5$0.3 billion are determined in accordance with ASC 450-20 and ASC 310-10-35 (troubled debt restructurings), respectively. Of the $65.8$59.8 billion in loans, approximately $61.9$57.0 billion and $3.8$2.7 billion of the loans are evaluated in accordance with ASC 450-20 and ASC 310-10-35 (troubled debt restructurings), respectively. For additional information, see Note 14 to the Consolidated Financial Statements.
(4)Includes mortgages and other retail loans.

December 31, 2016December 31, 2017
In billions of dollars
Allowance for
loan losses
Loans, net of
unearned income
Allowance as a
percentage of loans(1)
Allowance for
loan losses
Loans, net of
unearned income
Allowance as a
percentage of loans(1)
North America cards(2)
$5.2
$133.3
3.9%$6.1
$139.7
4.4%
North America mortgages(3)
1.1
72.6
1.5
0.7
64.2
1.1
North America other
0.5
13.6
3.7
0.3
13.0
2.3
International cards1.2
23.1
5.2
1.3
25.7
5.1
International other(4)
1.4
82.8
1.7
1.5
91.1
1.6
Total consumer$9.4
$325.4
2.9%$9.9
$333.7
3.0%
Total corporate2.7
299.0
0.9
2.5
333.3
0.8
Total Citigroup$12.1
$624.4
1.9%$12.4
$667.0
1.9%
(1)Allowance as a percentage of loans excludes loans that are carried at fair value.
(2)Includes both Citi-branded cards and Citi retail services. The $5.2$6.1 billion of loan loss reserves represented approximately 1516 months of coincident net credit loss coverage.
(3)
Of the $1.1$0.7 billion, approximately $1.0$0.6 billion was allocated to North America mortgages in Corporate/Other. Of the $1.1$0.7 billion, approximately $0.4$0.2 billion and $0.7$0.5 billion are determined in accordance with ASC 450-20 and ASC 310-10-35 (troubled debt restructurings), respectively. Of the $72.6$64.2 billion in loans, approximately $67.7$60.4 billion and $4.8$3.7 billion of the loans are evaluated in accordance with ASC 450-20 and ASC 310-10-35 (troubled debt restructurings), respectively. For additional information, see Note 14 to the Consolidated Financial Statements.
(4)Includes mortgages and other retail loans.


Non-Accrual Loans and Assets and Renegotiated Loans
There is a certain amount of overlap among non-accrual loans and assets and renegotiated loans. The following summary provides a general description of each category:

Non-Accrual Loans and Assets:Assets:
Corporate and consumer (commercial(including commercial banking) non-accrual status is based on the determination that payment of interest or principal is doubtful.
A corporate loan may be classified as non-accrual and still be performing under the terms of the loan structure. Payments received on corporate non-accrual loans are generally applied to loan principal and not reflected as interest income. Approximately 69%57%, 68% and 67%74% of Citi’s corporate non-accrual loans were performing at September 30, 20172018, June 30, 2018 and June 30,December 31, 2017, respectively.
Consumer non-accrual status is generally based on aging, i.e., the borrower has fallen behind on payments.
Consumer mortgage loans, other than Federal Housing Administration (FHA) insured loans, are classified as non-accrual within 60 days of notification that the borrower has filed for bankruptcy. In addition, home equity loans are classified as non-accrual if the related residential first mortgage loan is 90 days or more past due.
North America Citi-branded cards and Citi retail services are not included because, under industry standards, credit card loans accrue interest until such loans are charged off, which typically occurs at 180 days of contractual delinquency.
Renegotiated Loans:Loans:
Includes both corporate and consumer loans whose terms have been modified in a troubled debt restructuring (TDR).
Includes both accrual and non-accrual TDRs.



Non-Accrual Loans and Assets
The table below summarizes Citigroup’s non-accrual loans as of the periods indicated. Non-accrual loans may still be current on interest payments. In situations where Citi reasonably expects that only a portion of the principal owed will ultimately be collected, all payments received are reflected as a reduction of principal and not as interest income. For all other non-accrual loans, cash interest receipts are generally recorded as revenue.
 



Sept. 30,Jun. 30,Mar. 31,Dec. 31,Sept. 30,Sept. 30,Jun. 30,Mar. 31,Dec. 31,Sept. 30,
In millions of dollars201720172016201820182017
Corporate non-accrual loans(1)
  
North America$915
$944
$993
$984
$1,057
$679
$784
$817
$784
$915
EMEA681
727
828
904
857
362
391
561
849
681
Latin America312
281
342
379
380
266
204
263
280
312
Asia146
146
176
154
121
233
244
27
29
146
Total corporate non-accrual loans$2,054
$2,098
$2,339
$2,421
$2,415
$1,540
$1,623
$1,668
$1,942
$2,054
Consumer non-accrual loans(1)
  
North America$1,721
$1,754
$1,926
$2,160
$2,429
$1,323
$1,373
$1,500
$1,650
$1,721
Latin America791
793
737
711
841
764
726
791
756
791
Asia(2)
271
301
292
287
282
287
284
284
284
271
Total consumer non-accrual loans$2,783
$2,848
$2,955
$3,158
$3,552
$2,374
$2,383
$2,575
$2,690
$2,783
Total non-accrual loans$4,837
$4,946
$5,294
$5,579
$5,967
$3,914
$4,006
$4,243
$4,632
$4,837
(1)Excludes purchased distressed loans, as they are generally accreting interest. The carrying value of these loans was $131 million at September 30, 2018, $149 million at June 30, 2018, $126 million at March 31, 2018, $167 million at December 31, 2017 and $177 million at September 30, 2017, $183 million at June 30, 2017, $194 million at March 31, 2017, $187 million at December 31, 2016 and $194 million at September 30, 2016.2017.
(2)
(2) Asia GCB includes balances in certain EMEA countries for all periods presented.


The changes in Citigroup’s non-accrual loans were as follows:

Three Months EndedThree Months EndedThree Months EndedThree Months Ended
September 30, 2017September 30, 2016September 30, 2018September 30, 2017
In millions of dollarsCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotal
Non-accrual loans at beginning of period$2,098
$2,848
$4,946
$2,460
$3,705
$6,165
$1,623
$2,383
$4,006
$2,098
$2,848
$4,946
Additions190
1,042
1,232
469
1,131
1,600
436
758
1,194
190
1,042
1,232
Sales and transfers to held-for-sale(1)(69)(70)(4)(102)(106)
Sales and transfers to HFS(9)(44)(53)(1)(69)(70)
Returned to performing(2)(133)(135)(58)(149)(207)(14)(136)(150)(2)(133)(135)
Paydowns/settlements(196)(291)(487)(433)(562)(995)(479)(207)(686)(196)(291)(487)
Charge-offs(33)(611)(644)(24)(455)(479)(18)(417)(435)(33)(611)(644)
Other(2)(3)(5)5
(16)(11)1
37
38
(2)(3)(5)
Ending balance$2,054
$2,783
$4,837
$2,415
$3,552
$5,967
$1,540
$2,374
$3,914
$2,054
$2,783
$4,837







Nine Months EndedNine Months EndedNine Months EndedNine Months Ended
September 30, 2017September 30, 2016September 30, 2018September 30, 2017
In millions of dollarsCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotal
Non-accrual loans at beginning of period$2,421
$3,158
$5,579
$1,596
$3,658
$5,254
$1,942
$2,690
$4,632
$2,421
$3,158
$5,579
Additions754
2,563
3,317
2,346
3,371
5,717
1,889
2,410
4,299
754
2,563
3,317
Sales and transfers to held-for-sale(83)(286)(369)(13)(473)(486)(37)(197)(234)(83)(286)(369)
Returned to performing(42)(462)(504)(141)(434)(575)(118)(490)(608)(42)(462)(504)
Paydowns/settlements(843)(856)(1,699)(1,022)(1,203)(2,225)(1,976)(804)(2,780)(843)(856)(1,699)
Charge-offs(102)(1,452)(1,554)(277)(1,353)(1,630)(138)(1,243)(1,381)(102)(1,452)(1,554)
Other(51)118
67
(74)(14)(88)(22)8
(14)(51)118
67
Ending balance$2,054
$2,783
$4,837
$2,415
$3,552
$5,967
$1,540
$2,374
$3,914
$2,054
$2,783
$4,837


The tablestable below summarizesummarizes Citigroup’s other real estate owned (OREO) assets as of the periods indicated. This represents the carrying value of all real estate property acquired by foreclosure or other legal proceedings when Citi has taken possession of the collateral:
Sept. 30,Jun. 30,Mar. 31,Dec. 31,Sept. 30,Sept. 30,Jun. 30,Mar. 31,Dec. 31,Sept. 30,
In millions of dollars201720172016201820182017
OREO  
North America$97
$128
$136
$161
$132
$76
$66
$70
$89
$97
EMEA1
1
1
—
1
1
1
—
2
1
Latin America30
31
31
18
18
25
24
29
35
30
Asia15
8
5
7
10
7
10
15
18
15
Total OREO$143
$168
$173
$186
$161
$109
$101
$114
$144
$143
Non-accrual assets

 
Corporate non-accrual loans$2,054
$2,098
$2,339
$2,421
$2,415
$1,540
$1,623
$1,668
$1,942
$2,054
Consumer non-accrual loans2,783
2,848
2,955
3,158
3,552
2,374
2,383
2,575
2,690
2,783
Non-accrual loans (NAL)$4,837
$4,946
$5,294
$5,579
$5,967
$3,914
$4,006
$4,243
$4,632
$4,837
OREO$143
$168
$173
$186
$161
$109
$101
$114
$144
$143
Non-accrual assets (NAA)$4,980
$5,114
$5,467
$5,765
$6,128
$4,023
$4,107
$4,357
$4,776
$4,980
NAL as a percentage of total loans0.74%0.77%0.84%0.89%0.93%0.58%0.60%0.63%0.69%0.74%
NAA as a percentage of total assets0.26
0.27
0.30
0.32
0.34
0.21
0.21
0.23
0.26
0.26
Allowance for loan losses as a percentage of NAL(1)
256
243
227
216
208
315
303
291
267
256

(1)The allowance for loan losses includes the allowance for Citi’s credit card portfolios and purchased distressed loans, while the non-accrual loans exclude credit card balances (with the exception of certain international portfolios) and purchased distressed loans as these continue to accrue interest until charge-off.



Renegotiated Loans
The following table presents Citi’s loans modified in TDRs:
In millions of dollarsSept. 30, 2017Dec. 31, 2016Sept. 30, 2018Dec. 31, 2017
Corporate renegotiated loans(1)
    
In U.S. offices    
Commercial and industrial(2)
$285
$89
$226
$225
Mortgage and real estate78
84
64
90
Loans to financial institutions8
9
Financial institutions21
33
Other155
228
33
45
$526
$410
Total$344
$393
In offices outside the U.S.    
Commercial and industrial(2)
$401
$319
$254
$392
Mortgage and real estate7
3
7
11
Loans to financial institutions15
—
$423
$322
Financial institutions—
15
Other9
7
Total$270
$425
Total corporate renegotiated loans$949
$732
$614
$818
Consumer renegotiated loans(3)(4)(5)
    
In U.S. offices    
Mortgage and real estate(6)
$3,812
$4,695
$2,698
$3,709
Cards1,295
1,313
1,308
1,246
Installment and other176
117
84
169
$5,283
$6,125
Total$4,090
$5,124
In offices outside the U.S.    
Mortgage and real estate$337
$447
$320
$345
Cards525
435
493
541
Installment and other414
443
415
427
$1,276
$1,325
Total$1,228
$1,313
Total consumer renegotiated loans$6,559
$7,450
$5,318
$6,437
(1)Includes $769$504 million and $445$715 million of non-accrual loans included in the non-accrual loans table above at September 30, 20172018 and December 31, 2016,2017, respectively. The remaining loans are accruing interest.
(2)In addition to modifications reflected as TDRs at September 30, 2017,2018, Citi also modified $86$6 million of commercial loans risk rated “Substandard Non-Performing” or worse (asset category defined by banking regulators), all within in offices inoutside the U.S. These modifications were not considered TDRs because the modifications did not involve a concession.
(3)Includes $1,368$1,113 million and $1,502$1,376 million of non-accrual loans included in the non-accrual loans table above at September 30, 20172018 and December 31, 2016,2017, respectively. The remaining loans are accruing interest.
(4)Includes $42$19 million and $58$26 million of commercial real estate loans at September 30, 20172018 and December 31, 2016,2017, respectively.
(5)Includes $162$94 million and $105$165 million of other commercial loans at September 30, 20172018 and December 31, 2016,2017, respectively.
(6)Reduction in the nine months ended September 30, 2018 compared with December 31, 2017 includes $778$641 million related to TDRs sold or transferred to held-for-sale.HFS.



LIQUIDITY RISK

For additional information on funding and liquidity at Citigroup, including its objectives, management and measurement, see “Liquidity Risk” and “Risk Factors” in Citi’s 20162017 Annual Report on Form 10-K.
 
 




High-Quality Liquid Assets (HQLA)
Citibank
Non-Bank and Other(1)
TotalCitibankNon-Bank and OtherTotal
In billions of dollarsSept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
Available cash$89.8
$78.5
$71.1
$25.7
$35.0
$19.2
$115.5
$113.5
$90.2
$105.1
$97.3
$92.7
$35.1
$27.4
$32.9
$140.2
$124.7
$125.6
U.S. sovereign114.5
110.6
122.3
28.6
23.2
21.8
143.1
133.8
144.1
102.2
101.4
108.4
29.7
28.7
26.6
131.9
130.1
135.0
U.S. agency/agency MBS80.4
63.2
62.6
0.3
1.1
0.2
80.7
64.3
62.8
56.4
59.5
68.1
6.5
6.7
0.6
62.9
66.2
68.7
Foreign government debt(2)(1)
82.2
102.4
89.2
17.3
17.7
15.5
99.6
120.1
104.7
74.9
73.5
101.3
9.6
10.9
16.3
84.5
84.4
117.6
Other investment grade0.7
0.4
1.0
1.2
1.2
1.5
1.9
1.6
2.5
0.2
0.1
0.5
1.1
1.0
1.2
1.3
1.2
1.7
Total HQLA (EOP)$367.6
$355.1
$346.2
$73.1
$78.1
$58.2
$440.8
$433.2
$404.3
Total HQLA (AVG)$371.0
$354.0
$344.0
$77.6
$70.4
$59.8
$448.6
$424.4
$403.8
$338.8
$331.8
$371.0
$82.0
$74.8
$77.6
$420.8
$406.6
$448.6

Note: Except as indicated,The amounts set forth in the table above are as of period endpresented on an average basis and may increase or decrease intra-periodreflect HQLA held at Citigroup’s operating entities, which are eligible for inclusion in the ordinary course of business.Citigroup’s consolidated HQLA. For securities, the amounts represent the liquidity value that potentially could be realized and, therefore, exclude any securities that are encumbered and incorporate any haircuts that would be required for secured fundingsecurities financing transactions.
(1)Citibanamex and Citibank (Switzerland) AG account for approximately $6 billion of the “Non-Bank and Other” HQLA balance as of September 30, 2017.
(2)Foreign government debt includes securities issued or guaranteed by foreign sovereigns, agencies and multilateral development banks. Foreign government debt securities are held largely to support local liquidity requirements and Citi’s local franchises and principally include government bonds from Hong Kong, Singapore, Korea, Taiwan, Singapore, India, BrazilMexico and Mexico.Brazil.

As set forthThe table above includes average amounts of HQLA held at Citigroup’s operating entities that are eligible for inclusion in the calculation of Citigroup’s consolidated LCR, pursuant to the U.S. LCR rules. These amounts include the HQLA needed to meet the minimum requirements at these entities and any amounts in excess of these minimums that are assumed to be transferable to Citigroup. While available liquidity resources at operating entities generally increased, the amount of HQLA included in the table above sequentially,declined year-over-year as less HQLA in the operating entities was eligible for inclusion in the consolidated metric. Sequentially, Citi’s total HQLA increased, on both an average and end-of-period basis, predominantly driven by changes in eligibility assumptions relatingprimarily due to certain assets. On an average basis, the sequential increase in Citi’s total HQLA was also impacted by an increase in average cash.cash driven by a reduction in illiquid assets and the timing of long-term debt issuance.
Citi’s HQLA as set forth above does not include Citi’s available borrowing capacity from the Federal Home Loan Banks (FHLBs) of which Citi is a member, which was approximately $29 billion as of September 30, 2018 (compared to $21 billion as of June 30, 2018 and $16 billion as of September 30, 2017 (compared to $18 billion as of June 30, 2017 and $24 billion as of September 30, 2016)2017) and maintained by eligible collateral pledged to such banks. The HQLA also does not include Citi’s borrowing capacity at the U.S. Federal Reserve Bank discount window or other central banks, which would be in addition to the resources noted above.
In general, Citi’s liquidity is fungible across legal entities within its bank group. Citi’s bank subsidiaries, including Citibank, can lend to the Citi parent and broker-dealer entities in accordance with Section 23A of the Federal Reserve Act. As of September 30, 2017,2018, the capacity available for lending to these entities under Section 23A was approximately $15 billion, unchanged from both June 30, 20172018 and


September 30, 2016,2017, subject to certain eligible non-cash collateral requirements.



Loans
The table below sets forthdetails the average loans, by business and/or segment, and the total end-of-period loans for each of the periods indicated:
In billions of dollarsSept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
Global Consumer Banking  
North America$186.7
$183.4
$177.8
$192.8
$188.8
$186.7
Latin America26.8
25.5
24.2
26.3
25.5
26.8
Asia(1)
86.2
84.9
85.5
87.7
88.8
86.2
Total$299.7
$293.8
$287.5
$306.8
$303.1
$299.7
Institutional Clients Group  
Corporate lending123.3
121.5
124.0
$130.9
$135.5
$123.3
Treasury and trade solutions (TTS)74.9
73.7
71.1
76.9
77.7
74.9
Private Bank82.6
79.0
74.2
Private bank92.8
90.7
82.6
Markets and securities services
and other
40.1
38.2
37.2
45.6
43.0
40.1
Total$320.9
$312.4
$306.6
$346.2
$346.9
$320.9
Total Corporate/Other
25.8
28.2
40.9
$17.3
$19.7
$25.7
Total Citigroup loans (AVG)$646.3
$634.3
$634.9
$670.3
$669.7
$646.3
Total Citigroup loans (EOP)$653.2
$644.7
$638.4
$674.9
$671.2
$653.2

(1)
Includes loans in certain EMEA countries for all periods presented.

As set forth in the table above, end-of-periodEnd-of-period loans increased 2%3% year-over-year and 1% quarter-over-quarter.sequentially. On an average basis, loans increased 2% both4% year-over-year and quarter-over-quarter.were largely unchanged sequentially.
Excluding the impact of FX translation, average loans increased 1% both5% year-over-year and quarter-over-quarter. On this basis, average6% in aggregate across GCB and ICG. Average GCB loans grew 4%3% year-over-year, driven by 5% growth in North America. International GCB loans increased 1%, driven by 6% growth in Mexico, while Asia loans were unchanged, reflecting Citi’s optimization of its portfolio in this region.
across all regions. Average ICG loans increased 4%9% year-over-year, driven mostly by client-led growthwith continued momentum across businesses, including in TTS, the private bank. Corporate lending decreased 1%, primarily driven by a lower level of episodic funding compared to the prior-year period. Treasurybank and trade solutions loans increased 5%, driven by growth in EMEA and Asia.corporate lending.
Average Corporate/Other loans decreased 37% year-over-year,continued to decline (down 34%), driven by the continued wind downwind-down of legacy assets.
 
Deposits
The table below sets forthdetails the average deposits, by business and/or segment, and the total end-of-period deposits for each of the periods indicated:
In billions of dollarsSept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
Global Consumer Banking  
North America$184.1
$185.1
$183.9
$180.2
$179.9
$184.1
Latin America28.8
27.8
25.7
29.4
28.3
28.8
Asia(1)
95.2
94.3
91.6
97.6
97.6
95.2
Total$308.1
$307.2
$301.2
$307.2
$305.8
$308.1
Institutional Clients Group  
Treasury and trade solutions (TTS)427.8
423.9
414.6
$456.7
$448.7
$427.8
Banking ex-TTS122.4
122.1
119.6
124.6
125.5
122.4
Markets and securities services84.7
84.3
84.1
86.7
88.2
84.7
Total$634.9
$630.3
$618.4
$668.0
$662.4
$634.9
Corporate/Other22.9
22.5
24.7
$10.6
$18.0
$22.9
Total Citigroup deposits (AVG)$965.9
$960.0
$944.2
$985.7
$986.2
$965.9
Total Citigroup deposits (EOP)$964.0
$958.7
$940.3
$1,005.2
$996.7
$964.0
(1)
Includes deposits in certain EMEA countries for all periods presented.

End-of-period deposits increased 3%4% year-over-year and 1% quarter-over-quarter.sequentially. On an average basis, deposits increased 2% year-over-year and 1%were largely unchanged sequentially.
Excluding the impact of FX translation, average deposits grew 2%3% from the prior-year period, driven primarily by 3% growth in treasury and trade solutions,period. In GCB, deposits increased 1%, as well as 4% aggregatestrong growth in Asia GCB and Latin America GCB.GCB more than offset a 2% decline in North America GCB deposits were largely unchanged, primarily driven by a reduction in money market balances as a net inflow of deposits was offset by transfers from deposit toclients transferred cash into investment accounts.
Within ICG, average deposits grew 6% year-over-year, primarily driven by continued high-quality deposit growth in TTS.





Long-Term Debt
The weighted-average maturitiesmaturity of unsecured long-term debt issued by Citigroup and its affiliates (including Citibank) with a remaining life greater than one year (excluding remaining trust preferred securities outstanding) was approximately 6.86.9 years as of September 30, 2017, a modest decline2018, an increase from both the prior-year period (6.8 years) and the prior quarter.quarter (6.5 years).
Citi’s long-term debt outstanding at the Citigroup parent company includes senior and subordinated debt and a portion of what Citi refers to as customer-related debt, consisting of structured notes, such as equity- and credit-linked notes, as well as non-structured notes. Citi’s issuance of customer-related debt is generally driven by customer demand and supplements benchmark debt issuance as a source of funding for Citi’s parent and non-bank entities. Citi’s long-term debt at the bank also includes benchmark senior debt, FHLB advances and securitizations.

 
Long-Term Debt Outstanding
The following table sets forth Citi’s end-of-period total long-term debt outstanding for each of the periodsdates indicated:
In billions of dollarsSept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
Parent and other(1)












Benchmark debt:  
Senior debt$109.8
$105.9
$97.1
$107.2
$107.8
$109.8
Subordinated debt27.0
26.8
28.8
25.1
25.3
27.0
Trust preferred1.7
1.7
1.7
1.7
1.7
1.7
Customer-related debt:
Structured debt27.0
25.3
23.6
Non-structured debt3.3
3.1
3.5
Customer-related debt35.4
34.3
30.3
Local country and other(2)
1.8
2.1
2.7
3.8
3.8
1.8
Total parent and other$170.6
$164.9
$157.4
$173.2
$172.9
$170.6
Bank











FHLB borrowings$19.8
$20.3
$21.6
$10.5
$13.7
$19.8
Securitizations(3)
28.6
28.2
24.4
27.4
28.5
28.6
CBNA benchmark senior debt9.5
7.2
—
21.0
18.5
9.5
Local country and other(2)
4.2
4.5
5.7
3.2
3.2
4.2
Total bank$62.1
$60.2
$51.7
$62.1
$63.9
$62.1
Total long-term debt$232.7
$225.2
$209.1
$235.3
$236.8
$232.7
Note: Amounts represent the current value of long-term debt on Citi’s Consolidated Balance Sheet which, for certain debt instruments, includes consideration of fair value, hedging impacts and unamortized discounts and premiums.
(1)
“Parent and other” includes long-term debt issued to third parties by the parent holding company (Citigroup) and Citi’s non-bank subsidiaries (including broker-dealer subsidiaries) that are consolidated into Citigroup. As of September 30, 2017,2018, “parent and other” included $18.7$25.0 billion of long-term debt issued by Citi’s broker-dealer and other non-bank subsidiaries.
(2)Local country debt includes debt issued by Citi’s affiliates in support of their local operations.
(3)Predominantly credit card securitizations, primarily backed by Citi-branded credit card receivables.

Citi’s total long-term debt outstanding increased both year-over-year, and sequentially, primarily driven by the issuance of unsecured benchmark debt at the bank and customer-related debt at the Citigroup parent company, partially offset by declines in FHLB advances and senior unsecured benchmark debt at the parent as well ascompany. Sequentially, Citi’s total long-term debt outstanding decreased modestly, primarily driven by a decline in FHLB advances, partially offset by the issuance of unsecured benchmark senior debt at the bank.
As part of its liability management, Citi has considered, and may continue to consider, opportunities to repurchase its long-term debt pursuant to open market purchases, tender offers/redemptionsoffers or other means. Such repurchases help reduce Citi’s overall funding costs (andand assist it in meeting regulatory requirements).changes and requirements. During the third quarter of 2017,2018, Citi repurchased and called an aggregate of approximately $0.3$1.2 billion of its outstanding long-term debt.debt, including early redemption of FHLB advances.






Long-Term Debt Issuances and Maturities
The table below details Citi’s long-term debt issuances and maturities (including repurchases and redemptions) during the periods presented:
3Q172Q173Q163Q182Q183Q17
In billions of dollarsMaturitiesIssuancesMaturitiesIssuancesMaturitiesIssuancesMaturitiesIssuancesMaturitiesIssuancesMaturitiesIssuances
Parent and other























Benchmark debt:          
Senior debt$2.5
$5.7
$2.0
$6.3
$3.3
$4.5
$4.2
$4.5
$7.2
$4.9
$2.5
$5.7
Subordinated debt—
—
—
0.2
1.3
1.5
—
—
0.3
0.3
—
—
Trust preferred—
—
—
—
—
—
—
—
—
—
—
—
Customer-related debt:

   
Structured debt1.7
2.9
2.0
3.6
2.2
3.0
Non-structured debt0.1
0.1
0.3
—
0.1
0.2
Customer-related debt1.2
2.9
1.5
4.7
1.8
3.0
Local country and other0.4
—
0.1
—
0.1
0.4
0.3
0.1
0.2
2.1
0.4
—
Total parent and other$4.7
$8.7
$4.3
$10.2
$6.9
$9.6
$5.7
$7.6
$9.1
$12.0
$4.7
$8.7
Bank























FHLB borrowings$1.5
$1.0
$1.5
$1.5
$2.8
$5.8
$3.3
$—
$4.5
$2.5
$1.5
$1.0
Securitizations1.8
2.2
0.9
5.1
3.0
—
2.9
1.9
2.7
1.1
1.8
2.2
CBNA benchmark senior debt—
2.2
—
4.7
—
—
—
2.5
—
3.5
—
2.2
Local country and other0.5
0.5
0.7
0.3
0.9
0.9
0.2
0.3
0.9
0.9
0.5
0.5
Total bank$3.8
$5.9
$3.0
$11.6
$6.7
$6.7
$6.4
$4.7
$8.1
$8.0
$3.8
$5.9
Total$8.5
$14.6
$7.4
$21.8
$13.6
$16.3
$12.1
$12.3
$17.2
$20.0
$8.5
$14.6

The table below shows Citi’s aggregate long-term debt maturities (including repurchases and redemptions) year-to-date in 2017,2018, as well as its aggregate expected annual long-term debt maturities as of September 30, 2017:2018:
Maturities 2017 YTDMaturitiesMaturities 2018 YTDMaturities
In billions of dollars201720182019202020212022ThereafterTotal201820192020202120222023ThereafterTotal
Parent and other



































Benchmark debt:   
   
Senior debt$9.8
$4.3
$18.4
$14.7
$8.9
$14.4
$6.0
$43.1
$109.8
$14.9
$3.5
$14.3
$8.7
$14.2
$8.0
$12.4
$46.1
$107.2
Subordinated debt1.2
0.4
1.0
1.4
—
—
0.8
23.4
27.0
1.8
1.0
—
—
—
0.7
1.1
22.3
$25.1
Trust preferred—
—
—
—
—
—
—
1.7
1.7
—
—
—
—
—
—
—
1.7
1.7
Customer-related debt:   
Structured debt5.5
0.3
3.6
2.3
3.2
2.3
1.4
13.9
27.0
Non-structured debt0.5
—
0.6
0.2
0.3
0.1
0.2
1.9
3.3
Customer-related debt5.2
0.9
3.7
5.7
3.2
2.6
2.5
16.8
35.4
Local country and other1.0
—
0.7
0.1
0.1
0.1
—
0.8
1.8
0.5
2.2
0.4
0.1
0.4
—
—
0.7
3.8
Total parent and other$18.0
$5.0
$24.3
$18.7
$12.5
$16.9
$8.4
$84.8
$170.6
$22.4
$7.6
$18.4
$14.5
$17.8
$11.3
$16.0
$87.6
$173.2
Bank



































FHLB borrowings$4.8
$3.0
$15.3
$1.6
$—
$—
$—
$—
$19.8
$14.3
$1.5
$5.6
$3.4
$—
$—
$—
$—
$10.5
Securitizations4.7
0.6
9.4
6.5
4.4
3.8
1.2
2.7
28.6
8.5
0.1
7.9
6.1
5.7
2.2
2.5
2.9
27.4
CBNA benchmark debt—
—
2.2
4.7
2.5
—
—
—
9.5
—
2.2
4.7
8.7
5.0
—
—
0.4
21.0
Local country and other2.4
0.7
1.8
0.7
0.5
0.2
0.1
0.3
4.2
2.0
0.1
0.5
1.7
0.1
0.3
0.2
0.3
3.2
Total bank$11.8
$4.2
$28.7
$13.5
$7.4
$4.0
$1.3
$3.1
$62.1
$24.8
$3.9
$18.7
$19.9
$10.8
$2.5
$2.7
$3.6
$62.1
Total long-term debt$29.8
$9.3
$53.0
$32.2
$19.8
$20.9
$9.7
$87.9
$232.7
$47.2
$11.5
$37.1
$34.4
$28.6
$13.8
$18.7
$91.2
$235.3










 











Secured Funding Transactions and Short-Term Borrowings
Citi supplements its primary sources of funding with short-term borrowings. Short-term borrowings generally include (i) secured funding transactions (securities loaned or sold under agreements to repurchase, or repos) and (ii) to a lesser extent, short-term borrowings consisting of commercial paper and borrowings from the FHLB and other market participants (see Note 16 to the Consolidated Financial Statements for further information on Citigroup’s and its affiliates’ outstanding short-term borrowings).
Outside of secured funding transactions, Citi’s short-term borrowings increased 29%decreased 11% year-over-year and 4% sequentially. The increase both year-over-year and9% sequentially, was driven primarily by an increase in FHLB borrowings, as CitiCiti’s continued efforts to optimize liquidity across its legal entities.funding profile.

Secured Funding
Secured funding is primarily accessed through Citi’s broker-dealer subsidiaries to fund efficiently both secured lending activity and a portion of the securities inventory held in the context of market making and customer activities. Citi also executes a smaller portion of its secured funding transactions through its bank entities, which is typically collateralized by foreign government debt securities. Generally, daily changes in the level of Citi’s secured funding are primarily due to fluctuations in secured lending activity in the matched book (as described below) and securities inventory.
Secured funding of $161$176 billion as of September 30, 20172018 increased 5%9% from the prior-year period and 4%declined 1% sequentially. Excluding the impact of FX translation, secured funding increased 3%11% from both the prior-year period and declined 1% sequentially,both driven by normal business activity. Average balances for secured funding were also approximately $158$176 billion for the quarter ended September 30, 2017.2018.
The portion of secured funding in the broker-dealer subsidiaries that funds secured lending is commonly referred to as “matched book” activity. The majority of this activity is secured by high-quality liquid securities such as U.S. Treasury securities, U.S. agency securities and foreign government debt securities. Other secured funding is secured by less liquidless-liquid securities, including equity securities, corporate bonds and asset-backed securities. The tenor of Citi’s matched book liabilities is generally equal to or longer than the tenor of the corresponding matched book assets.
The remainder of the secured funding activity in the broker-dealer subsidiaries serves to fund securities inventory held in the context of market making and customer activities. To maintain reliable funding under a wide range of market conditions, including under periods of stress, Citi manages these activities by taking into consideration the quality of the underlying collateral and stipulating financing tenor. The weighted average maturity of Citi’s secured funding of less liquidless-liquid securities inventory was greater than 110 days as of September 30, 2017.2018.
Citi manages the risks in its secured funding by conducting daily stress tests to account for changes in capacity, tenors, haircut, collateral profile and client actions.
Additionally, Citi maintains counterparty diversification by
establishing concentration triggers and assessing counterparty reliability and stability under stress. Citi generally sources secured funding from more than 150 counterparties.

Liquidity Coverage Ratio (LCR)
In addition to internal measuresliquidity stress metrics that Citi has developed for a 30-day stress scenario, Citi also monitors its liquidity by reference to the LCR, as calculated pursuant to the U.S. LCR rules (for additional information, see “Liquidity Risk” in Citi’s 2016 Annual Report on Form 10-K).rules. The table below sets forth the components of Citi’s LCR calculation and HQLA in excess of net outflows as offor the periods indicated:
In billions of dollarsSept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
HQLA$448.6
$424.4
$403.8
$420.8
$406.6
$448.6
Net outflows365.1
338.2
335.3
350.8341.5
365.1
LCR123%125%120%120%119%123%
HQLA in excess of net outflows$83.5
$86.2
$68.5
$70.0$65.1
$83.5

Note: The amounts set forth in the table above are presented on an average basis.

As set forth in the table above, Citi’s average LCR increaseddecreased year-over-year, as an increasedriven by a decline in average HQLA, more thanpartially offset an increaseby a decline in modeled net outflows. Sequentially, Citi’s average LCR decreased modestly,increased slightly, due to the increase in HQLA, as described above (see “High-Quality Liquid Assets” above), partially offset by an increase in modeled net outflows was largely offset by an increase in average HQLA. Both the increase in modeled net outflows and the increase in average HQLA were predominantly driven by changes in assumptions, including changes in methodology to better align Citi’s outflow assumptions with those embedded in its resolution planning.outflows.
















Credit Ratings
The table below sets forth the ratings for Citigroup and Citibank as of September 30, 2017.2018. While not included in the table below, the long-termlong- and short-term ratings of Citigroup Global Markets Holdings Inc. (CGMHI) were BBB+/A-2 at Standard & Poor’s and A/F1 at Fitch as of September 30, 2017.2018.
 


 Citigroup Inc.Citibank, N.A.
 
Senior
debt
Commercial
paper
Outlook
Long-
term
Short-
term
Outlook
Fitch Ratings (Fitch)AF1StableA+F1Stable
Moody’s Investors Service (Moody’s)Baa1P-2StablePositiveA1P-1StablePositive
Standard & Poor’s (S&P)BBB+A-2StableA+A-1Stable

Potential Impacts of Ratings Downgrades
Ratings downgrades by Moody’s, Fitch or S&P could negatively impact Citigroup’s and/or Citibank’s funding and liquidity due to reduced funding capacity, including derivative triggers, which could take the form of cash obligations and collateral requirements.
The following information is provided for the purpose of analyzing the potential funding and liquidity impact to Citigroup and Citibank of a hypothetical, simultaneous
ratings downgrade across all three major rating agencies. This analysis is subject to certain estimates, estimation methodologies, judgments and uncertainties. Uncertainties include potential ratings limitations that certain entities may have with respect to permissible counterparties, as well as general subjective counterparty behavior. For example, certain corporate customers and markets counterparties could re-evaluate their business relationships with Citi and limit transactions in certain contracts or market instruments with Citi. Changes in counterparty behavior could impact Citi’s funding and liquidity, as well as the results of operations of certain of its businesses. The actual impact to Citigroup or Citibank is unpredictable and may differ materially from the potential funding and liquidity impacts described below. For additional information on the impact of credit rating changes on Citi and its applicable subsidiaries, see “Risk Factors— Liquidity Risks” in Citi’s 20162017 Annual Report on Form 10-K.

 

Citigroup Inc. and Citibank—Potential Derivative Triggers
As of September 30, 2017,2018, Citi estimates that a hypothetical one-notch downgrade of the senior debt/long-term rating of Citigroup Inc. across all three major rating agencies could impact Citigroup’s funding and liquidity due to derivative triggers by approximately $1.0$0.4 billion, compared to $0.7 billion as ofunchanged from June 30, 2017.2018. Other funding sources, such as secured fundingfinancing transactions and other margin requirements, for which there are no explicit triggers, could also be adversely affected.
As of September 30, 2017,2018, Citi estimates that a hypothetical one-notch downgrade of the senior debt/long-term rating of Citibank across all three major rating agencies could impact Citibank’s funding and liquidity by approximately $0.5$1.2 billion, compared to $0.3$0.9 billion as of June 30, 2017, due to derivative triggers.2018.
In total, Citi estimates that a one-notch downgrade of Citigroup and Citibank, across all three major rating agencies, could result in increased aggregate cash obligations and collateral requirements of approximately $1.5$1.6 billion, compared to $1.0$1.2 billion as of June 30, 20172018 (see also Note 19 to the Consolidated Financial Statements). As set forthdetailed under “High-Quality Liquid Assets” above, the liquidity resources that are eligible for inclusion in the calculation of CitibankCiti’s consolidated HQLA were approximately $371$339 billion for Citibank and the liquidity resources of$82 billion for Citi’s non-bank and other entities, were approximately $78 billion, for a total of approximately $449$421 billion as offor the quarter ended September 30, 2017.2018. These liquidity resources are available in part as a contingency for the potential events described above.
In addition, a broad range of mitigating actions are currently included in Citigroup’s and Citibank’s contingency funding plans. For Citigroup, these mitigating factors include, but are not limited to, accessing surplus funding capacity from existing clients, tailoring levels of secured lending and adjusting the size of select trading books and collateralized borrowings from certain Citibank subsidiaries. Mitigating actions available to Citibank include, but are not limited to, selling or financing highly liquid government securities, tailoring levels of secured lending, adjusting the size of select trading assets, reducing loan originations and renewals, raising additional deposits or borrowing from the FHLB or central banks. Citi believes these mitigating actions could


substantially reduce the funding and liquidity risk, if any, of the potential downgrades described above.

Citibank—Additional Potential Impacts
In addition to the above derivative triggers, Citi believes that a potential one-notch downgrade of Citibank’s senior debt/long-term rating by S&P could also have an adverse impact on the commercial paper/short-term rating of Citibank. As of September 30, 2018, Citibank had liquidity commitments of approximately $10.0$12.1 billion to consolidated asset-backed commercial paper conduits, compared to $12.0 billion as of September 30, 2017 and June 30, 20172018 (as referenced in Note 18 to the Consolidated Financial Statements).
In addition to the above-referenced liquidity resources of certain Citibank and Citibanamex entities, Citibank could reduce the funding and liquidity risk, if any, of the potential downgrades described above through mitigating actions, including repricing or reducing certain commitments to commercial paper conduits. In the event of the potential downgrades described above, Citi believes that certain corporate customers could re-evaluate their deposit relationships with Citibank. This re-evaluation could result in clients adjusting their discretionary deposit levels or changing their depository institution, which could potentially reduce certain deposit levels at Citibank. However, Citi could choose to adjust pricing, offer alternative deposit products to its existing customers or seek to attract deposits from new customers, in addition to the mitigating actions referenced above.


MARKET RISK

Market risk emanates from both Citi’s trading and non-trading portfolios. Trading portfolios comprise all assets and liabilities marked-to-market, with results reflected in earnings. Non-trading portfolios include all other assets and liabilities.
For additional information on market risk and market risk management at Citi, see “Market Risk” and “Risk Factors” in Citi’s 20162017 Annual Report on Form 10-K.
 

Market Risk of Non-Trading Portfolios
For additional information on Citi’s net interest revenue (for interest rate exposure purposes), interest rate risk and interest rate risk measurement, see “Market Risk of Non-Trading Portfolios” in Citi’s 20162017 Annual Report on Form 10-K.


The following table sets forth the estimated impact to Citi’s net interest revenue, AOCI and the Common Equity Tier 1 Capital ratio (on a fully implemented basis), each assuming an unanticipated parallel instantaneous 100 basis point (bps) increase in interest rates:
In millions of dollars (unless otherwise noted)Sept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
Estimated annualized impact to net interest revenue    
U.S. dollar(1)
$1,449
$1,435
$1,405
$879
$1,046
$1,449
All other currencies610
589
574
649
635
610
Total$2,059
$2,024
$1,979
$1,528
$1,681
$2,059
As a percentage of average interest-earning assets0.12%0.12%0.12%0.09%0.10%0.12%
Estimated initial impact to AOCI (after-tax)(2)
$(4,206)$(4,258)$(4,868)$(4,597)$(4,713)$(4,206)
Estimated initial impact on Common Equity Tier 1 Capital ratio (bps)(3)
(48)(49)(53)(31)(32)(48)

(1)Certain trading-oriented businesses within Citi have accrual-accounted positions that are excluded from the estimated impact to net interest revenue in the table, since these exposures are managed economically in combination with mark-to-market positions. The U.S. dollar interest rate exposure associated with these businesses was $(204)$(212) million for a 100 basis pointbps instantaneous increase in interest rates as of September 30, 2017.2018.
(2)Includes the effect of changes in interest rates on AOCI related to investment securities, cash flow hedges and pension liability adjustments.
(3)The estimated initialResults as of September 30, 2018 and June 30, 2018 reflect the impact of Tax Reform, including the lower expected effective tax rate and the impact to the Common Equity Tier 1 Capital ratio considers the effect of Citi’s DTA position and is based on only the estimated initial AOCI impact above.position. Results as of September 30, 2017 have not been restated.
The estimated impact to net interest revenue increased slightlydecreased on a sequential basis, reflecting changes in balance sheet composition.composition, including increased sensitivity in deposits combined with loan growth and other actions. The sequential decrease in the estimated impact to AOCI primarily reflected changes to the positioning of Citi Treasury’s investment securities and related interest rate derivatives portfolio.
In the event of an unanticipated parallel instantaneous 100 basis pointbps increase in interest rates, Citi expects that the negative impact to AOCI would be offset in stockholders’ equity through the combination of expected incremental net interest revenue and the expected recovery of the impact on AOCI through accretion of Citi’s investment portfolio over a period of time. As of September 30, 2017,2018, Citi expects that the negative $4.2$4.6 billion impact to AOCI in such a scenario could potentially be offset over approximately 2319 months.
 
The following table sets forth the estimated impact to Citi’s net interest revenue, AOCI and the Common Equity Tier 1 Capital ratio (on a fully implemented basis) under four different changes in interest rate scenarios for the U.S. dollar and Citi’s other currencies. While Citi also monitors the impact of a parallel decrease in interest rates, a 100 basis pointbps decrease in short-term rates is not meaningful, as it would imply negative interest rates in many of Citi's markets.



In millions of dollars (unless otherwise noted)Scenario 1Scenario 2Scenario 3Scenario 4
Overnight rate change (bps)100
100
—
—
10-year rate change (bps)100
—
100
(100)
Estimated annualized impact to net interest revenue 
    
U.S. dollar$879
$906
$47
$(56)
All other currencies649
617
37
(37)
Total$1,528
$1,523
$84
$(93)
Estimated initial impact to AOCI (after-tax)(1)
$(4,597)$(2,547)$(2,279)$1,772
Estimated initial impact to Common Equity Tier 1 Capital ratio (bps)(31)(17)(16)12
In millions of dollars (unless otherwise noted)Scenario 1Scenario 2Scenario 3Scenario 4
Overnight rate change (bps)100
100
—
—
10-year rate change (bps)100
—
100
(100)
Estimated annualized impact to net interest revenue 
    
U.S. dollar$1,449
$1,369
$89
$(130)
All other currencies610
554
34
(34)
Total$2,059
$1,923
$123
$(164)
Estimated initial impact to AOCI (after-tax)(1)
$(4,206)$(2,542)$(1,632)$1,077
Estimated initial impact to Common Equity Tier 1 Capital ratio (bps)(2)
(48)(29)(19)12
Note: Each scenario in the table above assumes that the rate change will occur instantaneously. Changes in interest rates for maturities between the overnight rate and the 10-year rate are interpolated.
(1)Includes the effect of changes in interest rates on AOCI related to investment securities, cash flow hedges and pension liability adjustments.


(2)The estimated initial impact to the Common Equity Tier 1 Capital ratio considers the effect of Citi’s deferred tax asset position and is based on only the estimated AOCI impact above.
As shown in the table above, the magnitude of the impact to Citi’s net interest revenue and AOCI is greater under scenario 2 as compared to scenario 3. This is because the combination of changes to Citi’s investment portfolio, partially offset by changes related to Citi’s pension liabilities, results in a net position that is more sensitive to rates at shorter- and intermediate-term maturities.
In recent years, a number of central banks, including the European Central Bank, the Bank of Japan and the Swiss National Bank, have implemented negative interest rates, and additional governmental entities could do so in the future. While negative interest rates can adversely impact net interest revenue (as well as net interest margin), Citi has, to date, been able to partially offset the impact of negative rates in these jurisdictions through a combination of business and Citi Treasury interest rate risk mitigation activities, including applying negative rates to client accounts (for additional information on Citi Treasury’s ongoing interest rate mitigation activities, see “Market Risk—Market Risk of Non-Trading Portfolios” in Citi’s 20162017 Annual ReportingReport on Form 10-K).

Changes in Foreign Exchange Rates—Impacts on AOCI and Capital
As of September 30, 2017,2018, Citi estimates that an unanticipated parallel instantaneous 5% appreciation of the U.S. dollar against all of the other currencies in which Citi has invested capital could reduce Citi’s tangible common equity (TCE) by approximately $1.6$1.4 billion, or 0.9%, as a result of changes to Citi’s foreign currency translation adjustment in AOCI, net of hedges. This impact would be primarily due to changes in the value of the Mexican peso, the Euro and the Australian dollar.
 
This impact is also before any mitigating actions Citi may take, including ongoing management of its foreign currency translation exposure. Specifically, as currency movements change the value of Citi’s net investments in foreign-currency-denominatedforeign currency-denominated capital, these movements also change the value of Citi’s risk-weighted assets denominated in those currencies. This, coupled with Citi’s foreign currency hedging strategies, such as foreign currency borrowings, foreign currency forwards and other currency hedging instruments, lessens the impact of foreign currency movements on Citi’s Common Equity Tier 1 Capital ratio. Changes in these hedging strategies, as well as hedging costs, divestitures and tax impacts, can further impactaffect the actual impact of changes in foreign exchange rates on Citi’s capital as compared to an unanticipated parallel shock, as described above.
The effect of Citi’s ongoing management strategies with respect to changes in foreign exchange rates and the impact of these changes on Citi’s TCE and Common Equity Tier 1 Capital ratio are shown in the table below. For additional information on the changes in AOCI, see Note 17 to the Consolidated Financial Statements.













For the quarter endedFor the quarter ended
In millions of dollars (unless otherwise noted)Sept. 30, 2017Jun. 30, 2017Sept. 30, 2016Sept. 30, 2018Jun. 30, 2018Sept. 30, 2017
Change in FX spot rate(1)
1.1%1.9%(0.2)%(0.2)%(5.8)%1.1%
Change in TCE due to FX translation, net of hedges$222
$478
$(412)$(354)$(2,241)$222
As a percentage of TCE0.1%0.3%(0.2)%(0.2)%(1.5)%0.1%
Estimated impact to Common Equity Tier 1 Capital ratio (on a fully implemented basis) due
to changes in FX translation, net of hedges (bps)
(3)(3)(2)—
—
(3)

(1)FX spot rate change is a weighted average based upon Citi’s quarterly average GAAP capital exposure to foreign countries.




Interest Revenue/Expense and Net Interest Margin
a3q17charta01.jpgabs3q18.jpg
3rd Qtr. 2nd Qtr. 3rd Qtr. Change3rd Qtr. 2nd Qtr. 3rd Qtr. Change
In millions of dollars, except as otherwise noted2017 2017 2016 3Q17 vs. 3Q162018 2018 2017 3Q18 vs. 3Q17
Interest revenue(1)
$15,944
 $15,323
 $14,767
 8 % $18,228
 $17,613
 $16,037
 14% 
Interest expense(2)
4,379
 4,036
 3,174
 38
 6,368
 5,885
 4,379
 45
 
Net interest revenue$11,565
 $11,287
 $11,593
 — % $11,860
 $11,728
 $11,658
 2% 
Interest revenue—average rate3.75% 3.70% 3.65% 10
bps4.15% 4.05% 3.77% 38
bps
Interest expense—average rate1.33
 1.26
 1.03
 30
bps1.83
 1.73
 1.33
 50
bps
Net interest margin(3)
2.72
 2.72
 2.86
 (14)bps2.70
 2.70
 2.74
 (4)bps
Interest-rate benchmarks                
Two-year U.S. Treasury note—average rate1.36% 1.30% 0.73% 63
bps2.67% 2.48% 1.36% 131
bps
10-year U.S. Treasury note—average rate2.24
 2.26
 1.56
 68
bps2.92
 2.92
 2.24
 68
bps
10-year vs. two-year spread88
bps96
bps83
bps 
 25
bps44
bps88
bps 
 
Note: All interest expense amounts include FDIC, as well as other similar deposit insurance assessments.assessments outside of the U.S.
(1)
Net interest revenue includes the taxable equivalent adjustments related to the tax-exempt bond portfolio (based on the U.S. federal statutory tax raterates of 21% in 2018 and 35%) in 2017) of $123$58 million, $122$63 million and $114$123 million for the three months ended September 30, 2017,2018, June 30, 20172018 and September 30, 2016,2017, respectively.
(2)
Interest expense associated with certain hybrid financial instruments, which are classified as Long-term debt and accounted for at fair value, is reported together with any changes in fair value as part of Principal transactions in the Consolidated Statements of Income and is therefore not reflected in Interest expense in the table above.
(3)Citi’s net interest margin (NIM) is calculated by dividing gross interest revenue less gross interest expense by average interest-earning assets.

Citi’s net interest revenue remained largely unchanged at $11.4in the third quarter of 2018 increased 2% to $11.9 billion ($11.6 billion(as set forth in the table above, also up 2% on a taxable equivalent basis) versus the prior-year period. Excluding the impact of FX translation, Citi’s net interest revenue increased 5%, or approximately $520 million. This increase was down slightly versus the prior-year period (down $110 million), asprimarily due to higher core accrual net interest revenue ($10.411.3 billion, up 5%approximately 9% or $0.5$1.0 billion) was offsetfrom Citi’s core accrual activities, which are mainly driven by lower trading-related net interest revenue ($0.7 billion, down 34% or $0.4 billion),its deposit and lower net interest revenue associated with legacy assets in Corporate/Other ($0.3 billion, down approximately 38% or $0.2 billion).lending businesses. The increase in core accrual net interest revenue was drivenpartially offset by lower trading-related net interest revenue ($0.4 billion, down approximately 47% or $0.3 billion) and lower net interest revenue associated with the impactwind-down of the December 2016, March 2017 and June 2017 interest rate increases and volume growth,legacy assets in Corporate/Other ($0.2
 
partially offsetbillion, down approximately 45% or $0.1 billion). The increase in the core accrual net interest revenue was driven mainly by higher long-term debt.interest rates, loan growth and an improved loan mix.
Citi’s NIM was 2.72%2.70% on a taxable equivalent basis in the third quarter of 2017,2018, a decrease of 144 bps from the prior-year period.prior- year period, driven primarily by lower trading-related NIM. Citi’s core accrual NIM was 3.45%3.60%, a declinean increase of 712 bps asversus the prior-year period, primarily driven by higher core accrual net interest revenue was more than offset by balance sheetrates, loan growth particularly in cash balances.and an improved loan mix. (Citi’s core accrual net interest revenue and core accrual NIM are non-GAAP financial measures. Citi believes these measures provide a more meaningful depiction for investors of the underlying fundamentals of its business results.)



Additional Interest Rate Details
Average Balances and Interest Rates—Assets(1)(2)(3) 
Taxable Equivalent Basis
Average volumeInterest revenue% Average rateAverage volumeInterest revenue% Average rate
3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.
In millions of dollars, except rates201720172016201720172016201720172016201820182017201820182017201820182017
Assets                
Deposits with banks(4)
$176,942
$166,023
$131,571
$486
$375
$247
1.09%0.91%0.75%$186,907
$176,151
$176,942
$629
$493
$486
1.34%1.12%1.09%
Federal funds sold and securities
borrowed or purchased under
agreements to resell(5)
      




     


In U.S. offices$136,681
$144,483
$146,581
$524
$472
$387
1.52%1.31%1.05%$154,120
$153,273
$136,681
$1,065
$838
$524
2.74%2.19%1.52%
In offices outside the U.S.(4)
108,770
104,780
88,415
334
356
249
1.22
1.36
1.12
114,389
118,098
108,770
360
498
334
1.25
1.69
1.22
Total$245,451
$249,263
$234,996
$858
$828
$636
1.39%1.33%1.08%$268,509
$271,371
$245,451
$1,425
$1,336
$858
2.11%1.97%1.39%
Trading account assets(6)(7)
     




    


In U.S. offices$98,725
$100,080
$100,381
$918
$877
$912
3.69%3.51%3.61%$92,034
$92,791
$98,725
$1,048
$851
$918
4.52%3.68%3.69%
In offices outside the U.S.(4)
105,882
103,581
100,825
555
646
559
2.08
2.50
2.21
112,979
117,840
105,882
614
922
555
2.16
3.14
2.08
Total$204,607
$203,661
$201,206
$1,473
$1,523
$1,471
2.86%3.00%2.91%$205,013
$210,631
$204,607
$1,662
$1,773
$1,473
3.22%3.38%2.86%
Investments     




    


In U.S. offices    




    


Taxable$227,680
$224,021
$228,337
$1,138
$1,086
$990
1.98%1.94%1.72%$227,282
$225,886
$227,680
$1,343
$1,315
$1,138
2.34%2.34%1.98%
Exempt from U.S. income tax17,890
18,466
19,102
181
197
162
4.01
4.28
3.37
17,088
17,339
17,890
175
180
181
4.06
4.16
4.01
In offices outside the U.S.(4)
106,456
106,758
107,350
835
830
794
3.11
3.12
2.94
103,120
104,562
106,456
903
913
835
3.47
3.50
3.11
Total$352,026
$349,245
$354,789
$2,154
$2,113
$1,946
2.43%2.43%2.18%$347,490
$347,787
$352,026
$2,421
$2,408
$2,154
2.76%2.78%2.43%
Loans (net of unearned income)(8)
      




     


In U.S. offices$372,067
$369,342
$368,372
$6,650
$6,392
$6,272
7.09%6.94%6.77%$385,610
$382,972
$372,067
$7,331
$6,958
$6,650
7.54%7.29%7.09%
In offices outside the U.S.(4)
274,254
264,986
267,399
4,031
3,832
3,974
5.83
5.80
5.91
284,663
286,772
274,254
4,326
4,251
4,124
6.03
5.95
5.97
Total$646,321
$634,328
$635,771
$10,681
$10,224
$10,246
6.56%6.46%6.41%$670,273
$669,744
$646,321
$11,657
$11,209
$10,774
6.90%6.71%6.61%
Other interest-earning assets(9)
$61,677
$60,107
$52,668
$292
$260
$221
1.88%1.74%1.67%$63,741
$69,341
$61,677
$434
$394
$292
2.70%2.28%1.88%
Total interest-earning assets$1,687,024
$1,662,627
$1,611,001
$15,944
$15,323
$14,767
3.75%3.70%3.65%$1,741,933
$1,745,025
$1,687,024
$18,228
$17,613
$16,037
4.15%4.05%3.77%
Non-interest-earning assets(6)
$205,268
$206,581
$219,213
      $180,871
$172,077
$205,268
      
Total assets$1,892,292
$1,869,208
$1,830,214
   $1,922,804
$1,917,102
$1,892,292
   
(1)
Net interest revenue includes the taxable equivalent adjustments related to the tax-exempt bond portfolio (based on the U.S. federal statutory tax raterates of 21% in 2018 and 35%) in 2017) of $123$58 million, $122$63 million and $114$123 million for the three months ended September 30, 2017,2018, June 30, 20172018 and September 30, 2016,2017, respectively.
(2)Interest rates and amounts include the effects of risk management activities associated with the respective asset categories.
(3)Monthly or quarterly averages have been used by certain subsidiaries where daily averages are unavailable.
(4)Average rates reflect prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.
(5)
Average volumes of securities borrowed or purchased under agreements to resell are reported net pursuant to ASC 210-20-45. However, Interest revenue excludes the impact of ASC 210-20-45.
(6)
The fair value carrying amounts of derivative contracts are reported net, pursuant to ASC 815-10-45, in Non-interest-earning assets and Other non-interest-bearing liabilities.
(7)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively.
(8)Includes cash-basis loans.
(9)Includes brokerage receivables.


Average Balances and Interest Rates—Liabilities and Equity, and Net Interest Revenue(1)(2)(3) 
Taxable Equivalent Basis
Average volumeInterest expense% Average rateAverage volumeInterest expense% Average rate
3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.3rd Qtr.2nd Qtr.3rd Qtr.
In millions of dollars, except rates201720172016201720172016201720172016201820182017201820182017201820182017
Liabilities                 
Deposits               
In U.S. offices(4)
$318,881
$311,758
$296,999
$695
$593
$470
0.86%0.76%0.63%$341,679
$332,595
$318,881
$1,231
$1,041
$695
1.43%1.26%0.86%
In offices outside the U.S.(5)
438,561
439,807
434,232
1,080
1,010
973
0.98
0.92
0.89
452,197
453,025
438,561
1,349
1,203
1,080
1.18
1.07
0.98
Total$757,442
$751,565
$731,231
$1,775
$1,603
$1,443
0.93%0.86%0.79%$793,876
$785,620
$757,442
$2,580
$2,244
$1,775
1.29%1.15%0.93%
Federal funds purchased and
securities loaned or sold under
agreements to repurchase(6)
      





     





In U.S. offices$93,167
$101,623
$99,924
$423
$396
$267
1.80%1.56%1.06%$105,194
$102,517
$93,167
$872
$796
$423
3.29%3.11%1.80%
In offices outside the U.S.(5)
64,897
59,354
58,060
289
280
192
1.77
1.89
1.32
70,638
68,556
64,897
378
428
289
2.12
2.50
1.77
Total$158,064
$160,977
$157,984
$712
$676
$459
1.79%1.68%1.16
$175,832
$171,073
$158,064
$1,250
$1,224
$712
2.82%2.87%1.79%
Trading account liabilities(7)(8)
      





     





In U.S. offices$32,622
$34,287
$33,600
$104
$81
$65
1.26%0.95%0.77%$38,385
$36,103
$32,622
$167
$140
$104
1.73%1.56%1.26%
In offices outside the U.S.(5)
57,187
56,731
42,637
65
65
37
0.45
0.46
0.35
57,746
61,048
57,187
106
96
65
0.73
0.63
0.45
Total$89,809
$91,018
$76,237
$169
$146
$102
0.75%0.64%0.53%$96,131
$97,151
$89,809
$273
$236
$169
1.13%0.97%0.75%
Short-term borrowings(9)
     





     





In U.S. offices$77,211
$68,486
$61,019
$234
$103
$51
1.20%0.60%0.33%$85,592
$84,338
$77,211
$502
$439
$234
2.33%2.09%1.20%
In offices outside the U.S.(5)
20,928
23,070
20,285
84
99
39
1.59
1.72
0.76
22,579
23,854
20,928
76
84
84
1.34
1.41
1.59
Total$98,139
$91,556
$81,304
$318
$202
$90
1.29%0.88%0.44%$108,171
$108,192
$98,139
$578
$523
$318
2.12%1.94%1.29%
Long-term debt(10)
      





    





In U.S. offices$198,766
$187,610
$175,427
$1,377
$1,361
$1,028
2.75%2.91%2.33%$200,199
$198,291
$198,766
$1,647
$1,620
$1,377
3.26%3.28%2.75%
In offices outside the U.S.(5)
4,298
4,534
6,506
28
48
52
2.58%4.25
3.18
5,390
4,980
4,298
40
38
28
2.94
3.06
2.58
Total$203,064
$192,144
$181,933
$1,405
$1,409
$1,080
2.75%2.94%2.36%$205,589
$203,271
$203,064
$1,687
$1,658
$1,405
3.26%3.27%2.75%
Total interest-bearing liabilities$1,306,518
$1,287,260
$1,228,689
$4,379
$4,036
$3,174
1.33%1.26%1.03%$1,379,599
$1,365,307
$1,306,518
$6,368
$5,885
$4,379
1.83%1.73%1.33%
Demand deposits in U.S. offices$37,673
$38,772
$40,466
     $31,697
$33,737
$37,673
    
Other non-interest-bearing liabilities(7)
318,060
313,227
328,405
    312,174
316,907
318,060
   
Total liabilities$1,662,251
$1,639,259
$1,597,560
    $1,723,470
$1,715,951
$1,662,251
   
Citigroup stockholders’ equity(11)
$229,017
$228,946
$231,574
    
Citigroup stockholders’ equity$198,494
$200,295
$229,017
   
Noncontrolling interest1,024
1,003
1,080
    840
856
1,024
   
Total equity(11)
$230,041
$229,949
$232,654
    
Total equity$199,334
$201,151
$230,041
   
Total liabilities and stockholders’ equity$1,892,292
$1,869,208
$1,830,214
    $1,922,804
$1,917,102
$1,892,292
   
Net interest revenue as a percentage of average interest-earning assets(12)
       
Net interest revenue as a percentage of average interest-earning assets(11)
      
In U.S. offices$975,283
$956,968
$953,877
$7,046
$6,777
$7,092
2.87%2.84%2.96%$1,005,236
$983,786
$975,283
$7,307
$6,710
$7,046
2.88%2.74%2.87%
In offices outside the U.S.(6)
711,741
705,659
657,124
4,519
4,510
4,501
2.52
2.56
2.72%736,697
761,239
711,741
4,553
5,018
4,612
2.45
2.64
2.57
Total$1,687,024
$1,662,627
$1,611,001
$11,565
$11,287
$11,593
2.72%2.72%2.86%$1,741,933
$1,745,025
$1,687,024
$11,860
$11,728
$11,658
2.70%2.70%2.74%
(1)
Net interest revenue includes the taxable equivalent adjustments related to the tax-exempt bond portfolio (based on the U.S. federal statutory tax raterates of 21% in 2018 and 35%) in 2017) of $123$58 million, $122$63 million and $114$123 million for the three months ended September 30, 2017,2018, June 30, 20172018 and September 30, 2016,2017, respectively.
(2)Interest rates and amounts include the effects of risk management activities associated with the respective liability categories.
(3)Monthly or quarterly averages have been used by certain subsidiaries where daily averages are unavailable.
(4)Consists of other time deposits and savings deposits. Savings deposits are made up of insured money market accounts, NOW accounts and other savings deposits. The interest expense on savings deposits includes FDIC deposit insurance assessments.
(5)Average rates reflect prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.
(6)
Average volumes of securities sold under agreements to repurchase are reported net pursuant to ASC 210-20-45. However, Interest expense excludes the impact of ASC 210-20-45.
(7)
The fair value carrying amounts of derivative contracts are reported net, pursuant to ASC 815-10-45, in Non-interest-earning assets and Other non-interest-bearing liabilities.


(8)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively.
(9)Includes brokerage payables.
(10)
Excludes hybrid financial instruments and beneficial interests in consolidated VIEs that are classified as Long-term debt, as these obligations are accounted for inthe changes in fair value for these obligations are recorded in Principal transactions.
(11)Includes stockholders’ equity from discontinued operations.
(12)Includes allocations for capital and funding costs based on the location of the asset.

Average Balances and Interest Rates—Assets(1)(2)(3)(4) 
Taxable Equivalent Basis
Average volumeInterest revenue% Average rateAverage volumeInterest revenue% Average rate
Nine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine Months
In millions of dollars, except rates201720162017201620172016201820172018201720182017
Assets           
Deposits with banks(5)
$165,910
$128,194
$1,156
$703
0.93%0.73%$177,975
$165,910
$1,554
$1,156
1.17%0.93%
Federal funds sold and securities borrowed or purchased under agreements to resell(6)
            
In U.S. offices$141,723
$148,379
$1,364
$1,123
1.29%1.01%$149,251
$141,723
$2,616
$1,364
2.34%1.29%
In offices outside the U.S.(5)
105,527
83,668
983
824
1.25%1.32%115,469
105,527
1,184
984
1.37
1.25
Total$247,250
$232,047
$2,347
$1,947
1.27%1.12%$264,720
$247,250
$3,800
$2,348
1.92%1.27%
Trading account assets(7)(8)
           
In U.S. offices$100,214
$104,655
$2,679
$2,835
3.57%3.62%$94,128
$100,214
$2,768
$2,679
3.93%3.57%
In offices outside the U.S.(5)
101,159
94,701
1,624
1,680
2.15%2.37%116,474
101,159
2,048
1,624
2.35
2.15
Total$201,373
$199,356
$4,303
$4,515
2.86%3.03%$210,602
$201,373
$4,816
$4,303
3.06%2.86%
Investments           
In U.S. offices           
Taxable$224,384
$227,532
$3,258
$2,981
1.94%1.75%$227,525
$224,384
$3,882
$3,258
2.28%1.94%
Exempt from U.S. income tax18,345
19,171
574
501
4.18%3.49%17,319
18,345
525
574
4.05
4.18
In offices outside the U.S.(5)
106,813
106,116
2,454
2,385
3.07%3.00%104,330
106,813
2,693
2,454
3.45
3.07
Total$349,542
$352,819
$6,286
$5,867
2.40%2.22%$349,174
$349,542
$7,100
$6,286
2.72%2.40%
Loans (net of unearned income)(9)
           
In U.S. offices$369,602
$357,300
$19,315
$17,938
6.99%6.71%$382,980
$369,602
$21,021
$19,316
7.34%6.99%
In offices outside the U.S.(5)
265,060
265,586
11,560
11,847
5.83%5.96%286,334
265,060
12,754
11,844
5.96
5.97
Total$634,662
$622,886
$30,875
$29,785
6.50%6.39%$669,314
$634,662
$33,775
$31,160
6.75%6.56%
Other interest-earning assets(10)
$59,506
$54,329
$846
$709
1.90%1.74%$66,614
$59,506
$1,192
$846
2.39%1.90%
Total interest-earning assets$1,658,243
$1,589,631
$45,813
$43,526
3.69%3.66%$1,738,399
$1,658,243
$52,237
$46,099
4.02%3.72%
Non-interest-earning assets(7)
$205,775
$215,402
 
 
 
 
$176,312
$205,775
  
  
Total assets$1,864,018
$1,805,033
 
 
 
 
$1,914,711
$1,864,018
  
  
(1)
Net interest revenue includes the taxable equivalent adjustments (based on the U.S. federal statutory tax raterates of 21% in 2018 and 35%) in 2017) of $368$185 million and $350$370 million for the nine months ended September 30, 20172018 and 2016,2017, respectively.
(2)Interest rates and amounts include the effects of risk management activities associated with the respective asset and liability categories.
(3)Monthly or quarterly averages have been used by certain subsidiaries where daily averages are unavailable.
(4)
Detailed average volume, Interest revenue and Interest expense exclude Discontinued operations. See Note 2 to the Consolidated Financial Statements.
(5)Average rates reflect prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.
(6)
Average volumes of securities borrowed or purchased under agreements to resell are reported net pursuant to FIN 41 (ASC 210-20-45). However, Interest revenue excludes the impact of FIN 41 (ASC 210-20-45).
(7)
The fair value carrying amounts of derivative contracts are reported in Non-interest-earning assets and Other non-interest-bearing liabilities.
(8)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively.
(9)Includes cash-basis loans.
(10)Includes brokerage receivables.




Average Balances and Interest Rates—Liabilities and Equity, and Net Interest Revenue(1)(2)(3)(4) 
Taxable Equivalent Basis
Average volumeInterest expense% Average rateAverage volumeInterest expense% Average rate
Nine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine MonthsNine Months
In millions of dollars, except rates201720162017201620172016201820172018201720182017
Liabilities          
Deposits          
In U.S. offices(5)
$310,977
$287,100
$1,795
$1,157
0.77%0.54%$332,542
$310,977
$3,169
$1,795
1.27%0.77%
In offices outside the U.S.(6)
435,704
431,176
2,998
2,796
0.92%0.87%450,546
435,704
3,652
2,998
1.08
0.92
Total$746,681
$718,276
$4,793
$3,953
0.86%0.74%$783,088
$746,681
$6,821
$4,793
1.16%0.86%
Federal funds purchased and securities loaned
or sold under agreements to repurchase(7)
         
In U.S. offices$96,417
$102,321
$1,101
$787
1.53%1.03%$102,242
$96,417
$2,272
$1,101
2.97%1.53%
In offices outside the U.S.(6)
59,559
58,379
780
701
1.75%1.60%68,215
59,559
1,151
780
2.26
1.75
Total$155,976
$160,700
$1,881
$1,488
1.61%1.24%$170,457
$155,976
$3,423
$1,881
2.68%1.61%
Trading account liabilities(8)(9)
         
In U.S. offices$33,041
$28,219
$269
$181
1.09%0.86%$36,161
$33,041
$434
$269
1.60%1.09%
In offices outside the U.S.(6)
57,862
43,424
193
105
0.45%0.32%58,840
57,862
290
193
0.66
0.45
Total$90,903
$71,643
$462
$286
0.68%0.53%$95,001
$90,903
$724
$462
1.02%0.68%
Short-term borrowings(10)
         
In U.S. offices$72,435
$57,559
$422
$123
0.78%0.29%$86,377
$72,435
$1,330
$422
2.06%0.78%
In offices outside the U.S.(6)
22,668
17,727
297
177
1.75%1.33%23,305
22,668
242
297
1.39
1.75
Total$95,103
$75,286
$719
$300
1.01%0.53%$109,682
$95,103
$1,572
$719
1.92%1.01%
Long-term debt(11)
         
In U.S. offices$188,344
$174,454
$3,993
$3,031
2.83%2.32%$199,471
$188,344
$4,749
$3,993
3.18%2.83%
In offices outside the U.S.(6)
4,715
6,691
133
176
3.77%3.51%4,908
4,715
124
133
3.38
3.77
Total$193,059
$181,145
$4,126
$3,207
2.86%2.36%$204,379
$193,059
$4,873
$4,126
3.19%2.86%
Total interest-bearing liabilities$1,281,722
$1,207,050
$11,981
$9,234
1.25%1.02%$1,362,607
$1,281,722
$17,413
$11,981
1.71%1.25%
Demand deposits in U.S. offices$38,064
$36,927
 
 
 
 $33,654
$38,064
  
 
Other non-interest-bearing liabilities(8)
313,939
331,906
 
 
 
 317,697
313,605
  
 
Total liabilities$1,633,725
$1,575,883
 
 
 
 $1,713,958
$1,633,391
  
 
Citigroup stockholders’ equity(12)
$229,284
$228,014
 
 
 
 $199,874
$229,618
  
 
Noncontrolling interest1,009
1,136
 
 
 
 879
1,009
  
 
Total equity(12)
$230,293
$229,150
 
 
 
 $200,753
$230,627
  
 
Total liabilities and stockholders’ equity$1,864,018
$1,805,033
 
 
 
 $1,914,711
$1,864,018
  
 
Net interest revenue as a percentage of average interest-earning assets           
In U.S. offices$960,206
$941,990
$20,586
$20,894
2.87%2.96%$987,592
$963,789
$20,734
$20,588
2.81%2.86%
In offices outside the U.S.(6)
698,037
647,641
13,246
13,398
2.54
2.76
750,807
694,454
14,090
13,530
2.51
2.60
Total$1,658,243
$1,589,631
$33,832
$34,292
2.73%2.88%$1,738,399
$1,658,243
$34,824
$34,118
2.68%2.75%
(1)
Net interest revenue includes the taxable equivalent adjustments (based on the U.S. federal statutory tax raterates of 21% in 2018 and 35%) in 2017) of $368$185 million and $350$370 million for the nine months ended September 30, 20172018 and 2016,2017, respectively.
(2)Interest rates and amounts include the effects of risk management activities associated with the respective asset and liability categories.
(3)Monthly or quarterly averages have been used by certain subsidiaries where daily averages are unavailable.
(4)
Detailed average volume, Interest revenue and Interest expense exclude Discontinued operations. See Note 2 to the Consolidated Financial Statements.
(5)Consists of other time deposits and savings deposits. Savings deposits are made up of insured money market accounts, NOW accounts and other savings deposits. The interest expense on savings deposits includes FDIC deposit insurance fees and charges.
(6)Average rates reflect prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.
(7)
Average volumes of securities loaned or sold under agreements to repurchase are reported net pursuant to FIN 41 (ASC 210-20-45). However, Interest expense excludes the impact of FIN 41 (ASC 210-20-45).
(8)
The fair value carrying amounts of derivative contracts are reported in Non-interest-earning assets and Other non-interest-bearing liabilities.
(9)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively.
(10)
Excludes hybrid financial instruments and beneficial interests in consolidated VIEs that are classified as Long-term debt, as these obligations are accounted for in changes in fair value recorded in Principal transactions.
(11)Includes stockholders' equity from discontinued operations.
(12)Includes allocations for capital and funding costs based on the location of the asset.


Analysis of Changes in Interest Revenue(1)(2)(3) 
3rd Qtr. 2017 vs. 2nd Qtr. 20173rd Qtr. 2017 vs. 3rd Qtr. 20163rd Qtr. 2018 vs. 2nd Qtr. 20183rd Qtr. 2018 vs. 3rd Qtr. 2017
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
In millions of dollars
Average
volume
Average
rate
Net
change
Average
volume
Average
rate
Net
change
Average
volume
Average
rate
Net
change
Average
volume
Average
rate
Net
change
Deposits with banks(4)
$26
$85
$111
$102
$137
$239
$32
$104
$136
$29
$114
$143
Federal funds sold and securities borrowed or
purchased under agreements to resell
      
In U.S. offices$(27)$79
$52
$(28)$165
$137
$5
$222
$227
$74
$467
$541
In offices outside the U.S.(4)
13
(35)(22)61
24
85
(15)(123)(138)18
8
26
Total$(14)$44
$30
$33
$189
$222
$(10)$99
$89
$92
$475
$567
Trading account assets(5)
      
In U.S. offices$(12)$53
$41
$(15)$21
$6
$(7)$204
$197
$(65)$195
$130
In offices outside the U.S.(4)
14
(105)(91)27
(31)(4)(37)(271)(308)38
21
59
Total$2
$(52)$(50)$12
$(10)$2
$(44)$(67)$(111)$(27)$216
$189
Investments(1)
      
In U.S. offices$16
$20
$36
$(9)$176
$167
$7
$16
$23
$(6)$205
$199
In offices outside the U.S.(4)
(2)7
5
(7)48
41
(13)3
(10)(27)95
68
Total$14
$27
$41
$(16)$224
$208
$(6)$19
$13
$(33)$300
$267
Loans (net of unearned income)(6)
      
In U.S. offices$47
$211
$258
$63
$315
$378
$48
$325
$373
$248
$433
$681
In offices outside the U.S.(4)
136
63
199
101
(44)57
(31)106
75
158
44
202
Total$183
$274
$457
$164
$271
$435
$17
$431
$448
$406
$477
$883
Other interest-earning assets(7)
$7
$25
$32
$41
$30
$71
$(34)$74
$40
$10
$132
$142
Total interest revenue$218
$403
$621
$336
$841
$1,177
$(45)$660
$615
$477
$1,714
$2,191
(1)The taxable equivalent adjustment is related to the tax-exempt bond portfolio based on the U.S. federal statutory tax raterates of 21% in 2018 and 35% in 2017 and is included in this presentation.
(2)Rate/volume variance is allocated based on the percentage relationship of changes in volume and changes in rate to the total net change.
(3)
Detailed average volume, Interest revenue and Interest expense exclude Discontinued operations. See Note 2 to the Consolidated Financial Statements.
(4)Changes in average rates reflect changes in prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.
(5)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively.
(6)Includes cash-basis loans.
(7)Includes brokerage receivables.


Analysis of Changes in Interest Expense and Net Interest Revenue(1)(2)(3) 
3rd Qtr. 2017 vs. 2nd Qtr. 20173rd Qtr. 2017 vs. 3rd Qtr. 20163rd Qtr. 2018 vs. 2nd Qtr. 20183rd Qtr. 2018 vs. 3rd Qtr. 2017
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
In millions of dollars
Average
volume
Average
rate
Net
change
Average
volume
Average
rate
Net
change
Average
volume
Average
rate
Net
change
Average
volume
Average
rate
Net
change
Deposits      
In U.S. offices$14
$88
$102
$37
$188
$225
$29
$161
$190
$53
$483
$536
In offices outside the U.S.(4)
(3)73
70
10
97
107
(2)148
146
34
235
269
Total$11
$161
$172
$47
$285
$332
$27
$309
$336
$87
$718
$805
Federal funds purchased and securities loaned
or sold under agreements to repurchase		        
In U.S. offices$(35)$62
$27
$(19)$175
$156
$21
$55
$76
$61
$388
$449
In offices outside the U.S.(4)
25
(16)9
25
72
97
13
(63)(50)27
62
89
Total$(10)$46
$36
$6
$247
$253
$34
$(8)$26
$88
$450
$538
Trading account liabilities(5)
      
In U.S. offices$(4)$27
$23
$(2)$41
$39
$9
$18
$27
$21
$42
$63
In offices outside the U.S.(4)
1
(1)—
15
13
28
(5)15
10
1
40
41
Total$(3)$26
$23
$13
$54
$67
$4
$33
$37
$22
$82
$104
Short-term borrowings(6)
      
In U.S. offices$15
$116
$131
$17
$166
$183
$7
$56
$63
$28
$240
$268
In offices outside the U.S.(4)
(9)(6)(15)1
44
45
(4)(4)(8)6
(14)(8)
Total$6
$110
$116
$18
$210
$228
$3
$52
$55
$34
$226
$260
Long-term debt      
In U.S. offices$79
$(63)$16
$147
$202
$349
$16
$11
$27
$10
$260
$270
In offices outside the U.S.(4)
(2)(18)(20)(16)(8)(24)3
(1)2
8
4
12
Total$77
$(81)$(4)$131
$194
$325
$19
$10
$29
$18
$264
$282
Total interest expense$81
$262
$343
$215
$990
$1,205
$85
$396
$483
$249
$1,740
$1,989
Net interest revenue$137
$141
$278
$121
$(149)$(28)$(130)$262
$132
$225
$(23)$202
(1)The taxable equivalent adjustment is related to the tax-exempt bond portfolio based on the U.S. federal statutory tax raterates of 21% in 2018 and 35% in 2017 and is included in this presentation.
(2)Rate/volume variance is allocated based on the percentage relationship of changes in volume and changes in rate to the total net change.
(3)
Detailed average volume, Interest revenue and Interest expense exclude Discontinued operations. See Note 2 to the Consolidated Financial Statements.
(4)Changes in average rates reflect changes in prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.
(5)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively.
(6)Includes brokerage payables.


























Analysis of Changes in Interest Revenue, Interest Expense and Net Interest Revenue(1)(2)(3) 
Nine Months 2017 vs. Nine Months 2016Nine Months 2018 vs. Nine Months 2017
Increase (decrease)
due to change in:
Increase (decrease)
due to change in:
In millions of dollars
Average
volume
Average
rate
Net
change(2)
Average
volume
Average
rate
Net
change(2)
Deposits with banks(4)
$236
$217
$453
$89
$309
$398
Federal funds sold and securities borrowed or purchased under agreements to resell      
In U.S. offices$(52)$293
$241
$76
$1,176
$1,252
In offices outside the U.S.(4)
206
(47)159
97
103
200
Total$154
$246
$400
$173
$1,279
$1,452
Trading account assets(5)
      
In U.S. offices$(119)$(37)$(156)$(169)$258
$89
In offices outside the U.S.(4)
110
(166)(56)260
164
424
Total$(9)$(203)$(212)$91
$422
$513
Investments(1)
      
In U.S. offices$(57)$407
$350
$34
$541
$575
In offices outside the U.S.(4)
16
53
69
(58)297
239
Total$(41)$460
$419
$(24)$838
$814
Loans (net of unearned income)(6)
      
In U.S. offices$629
$748
$1,377
$714
$991
$1,705
In offices outside the U.S.(4)
(23)(264)(287)948
(38)910
Total$606
$484
$1,090
$1,662
$953
$2,615
Other interest-earning assets$71
$66
$137
$109
$237
$346
Total interest revenue$1,017
$1,270
$2,287
$2,100
$4,038
$6,138
Deposits(7)
      
In U.S. offices$103
$535
$638
$132
$1,242
$1,374
In offices outside the U.S.(4)
30
172
202
105
549
654
Total$133
$707
$840
$237
$1,791
$2,028
Federal funds purchased and securities loaned or sold under agreements to repurchase      
In U.S. offices$(48)$362
$314
$70
$1,101
$1,171
In offices outside the U.S.(4)
14
65
79
124
247
371
Total$(34)$427
$393
$194
$1,348
$1,542
Trading account liabilities(5)
      
In U.S. offices$34
$54
$88
$27
$138
$165
In offices outside the U.S.(4)
41
47
88
3
94
97
Total$75
$101
$176
$30
$232
$262
Short-term borrowings      
In U.S. offices$39
$260
$299
$95
$813
$908
In offices outside the U.S.(4)
57
63
120
8
(63)(55)
Total$96
$323
$419
$103
$750
$853
Long-term debt      
In U.S. offices$255
$707
$962
$245
$511
$756
In offices outside the U.S.(4)
(55)12
(43)5
(14)(9)
Total$200
$719
$919
$250
$497
$747
Total interest expense$470
$2,277
$2,747
$814
$4,618
$5,432
Net interest revenue$547
$(1,007)$(460)$1,286
$(580)$706
(1)The taxable equivalent adjustment is related to the tax-exempt bond portfolio based on the U.S. Federalfederal statutory tax raterates of 21% in 2018 and 35% in 2017 and is included in this presentation.
(2)Rate/volume variance is allocated based on the percentage relationship of changes in volume and changes in rate to the total net change.
(3)
Detailed average volume, Interest revenue and Interest expense exclude Discontinued operations.


(4)Changes in average rates reflect changes in prevailing local interest rates, including inflationary effects and monetary corrections in certain countries.


(5)
Interest expense on Trading account liabilities of ICG is reported as a reduction of Interest revenue. Interest revenue and Interest expense on cash collateral positions are reported in Trading account assets and Trading account liabilities, respectively.
(6)Includes cash-basis loans.
(7)The interest expense on deposits includes the FDIC assessment and deposit insurance fees and charges of $936$1,006 million and $838$935 million for the nine months ended September 30, 20172018 and 2016,2017, respectively.


Market Risk of Trading Portfolios
For additional information on Citi’s market risk of trading portfolios, see “Market Risk—Market Risk of Trading Portfolios” in Citi’s 20162017 Annual Report on Form 10-K.

Value at Risk
As of September 30, 2017,2018, Citi estimates that the conservative features of its VAR calibration contributecontributed an approximate 22% add-on (unchanged from June 30, 2017) to what would be a VAR estimated under the assumption of stable and perfectly normal distributed markets. As of June 30, 2018, the add-on was 25%.
As set forth in the table below, Citi's average trading VAR as of September 30, 20172018 decreased compared to June 30, 2017.2018. The changedecrease was mainly due to lower credit spread exposures and volatilitiesforeign exchange risk in the marketsMarkets businesses within ICG, partially offset by higher interest rate risk from increased mark-to-market hedging activity against non-trading positions.. The decrease of average trading and credit portfolio VAR was in line with the decrease in average trading VAR.



Quarter-end and Average Trading VAR and Trading and Credit Portfolio VAR
 Third Quarter Second Quarter Third Quarter Third Quarter Second Quarter Third Quarter
In millions of dollarsSeptember 30, 20172017 AverageJune 30, 20172017 AverageSeptember 30, 20162016 AverageSeptember 30, 20182018 AverageJune 30, 20182018 AverageSeptember 30, 20172017 Average
Interest rate$63
$63
$48
$52
$30
$34
$33
$58
$60
$61
$63
$63
Credit spread43
44
52
49
73
$62
45
42
46
47
43
44
Covariance adjustment(1)
(28)(23)(15)(15)(28)(31)(17)(24)(25)(26)(28)(23)
Fully diversified interest rate and credit spread(2)
$78
$84
$85
$86
$75
$65
$61
$76
$81
$82
$78
$84
Foreign exchange26
26
23
23
16
26
18
21
29
30
26
26
Equity15
13
15
15
9
12
23
21
23
20
15
13
Commodity20
23
20
21
22
23
17
21
16
17
20
23
Covariance adjustment(1)
(64)(65)(53)(59)(53)(62)(58)(68)(74)(69)(64)(65)
Total trading VAR—all market risk factors, including general
and specific risk (excluding credit portfolios)(2)
$75
$81
$90
$86
$69
$64
$61
$71
$75
$80
$75
$81
Specific risk-only component(3)
$3
$2
$1
$1
$7
$6
$7
$1
$2
$3
$3
$2
Total trading VAR—general market risk factors only
(excluding credit portfolios)
$72
$79
$89
$85
$62
$58
$54
$70
$73
$77
$72
$79
Incremental impact of the credit portfolio(5)(4)
$8
$8
$5
$10
$21
$21
$11
$11
$16
$10
$8
$8
Total trading and credit portfolio VAR$83
$89
$95
$96
$90
$85
$72
$82
$91
$90
$83
$89

(1)Covariance adjustment (also known as diversification benefit) equals the difference between the total VAR and the sum of the VARs tied to each individual risk type. The benefit reflects the fact that the risks within each and across risk types are not perfectly correlated and, consequently, the total VAR on a given day will be lower than the sum of the VARs relating to each individual risk type. The determination of the primary drivers of changes to the covariance adjustment is made by an examination of the impact of both model parameter and position changes.
(2)
The total trading VAR includes mark-to-market and certain fair value option trading positions in ICG, with the exception of hedges to the loan portfolio, fair value option loans and all CVA exposures. Available-for-sale and accrual exposures are not included.
(3)The specific risk-only component represents the level of equity and fixed income issuer-specific risk embedded in VAR.
(4)
The credit portfolio is composed of mark-to-market positions associated with non-trading business units including Citi Treasury, the CVA relating to derivative counterparties and all associated CVA hedges. FVA and DVA are not included. The credit portfolio also includes hedges to the loan portfolio, fair value option loans and hedges to the leveraged finance pipeline within capital markets origination in ICG.
(5)The decrease in the third quarter of 2017 end-of-period and average VAR attributable to the incremental impact of the credit portfolio year-over-year was primarily related to a reduction in the use of credit default swaps used to hedge the corporate loan portfolio.



 

The table below provides the range of market factor VARs associated with Citi’s total trading VAR, inclusive of specific risk:
Third QuarterSecond QuarterThird QuarterThird QuarterSecond QuarterThird Quarter
201720172016201820182017
In millions of dollarsLowHighLowHighLowHighLowHighLowHighLowHigh
Interest rate$33
$97
$33
$72
$27
$47
$33
$80
$38
$91
$33
$97
Credit spread38
52
47
53
55
73
38
47
43
52
38
52
Fully diversified interest rate and credit spread$59
$108
$67
$107
$59
$75
$61
$95
$59
$118
$59
$108
Foreign exchange19
38
17
28
15
46
13
27
20
44
19
38
Equity8
18
10
24
6
22
16
28
15
26
8
18
Commodity14
31
14
30
19
31
16
27
13
22
14
31
Total trading$58
$106
$67
$116
$53
$72
$56
$91
$57
$120
$58
$106
Total trading and credit portfolio67
112
78
123
72
97
66
101
69
123
67
112
Note: No covariance adjustment can be inferred from the above table as the high and low for each market factor will be from different close-of-business dates.

The following table provides the VAR for ICG, excluding the CVA relating to derivative counterparties, hedges of CVA, fair value option loans and hedges to the loan portfolio:
In millions of dollarsSept. 30, 2017Sept. 30, 2018
Total—all market risk factors, including
general and specific risk
$73
 
Average—during quarter$80
$71
High—during quarter107
91
Low—during quarter57
56

Regulatory VAR Back-testing
In accordance with Basel III, Citi is required to perform back-testing to evaluate the effectiveness of its Regulatory VAR model. Regulatory VAR back-testing is the process in which the daily one-day VAR, at a 99% confidence interval, is compared to the buy-and-hold profit and loss (i.e., the profit and loss impact if the portfolio is held constant at the end of the day and re-priced the following day). Buy-and-hold profit and loss represents the daily mark-to-market profit and loss attributable to price movements in covered positions from the close of the previous business day. Buy-and-hold profit and loss excludes realized trading revenue, net interest, fees and commissions, intra-day trading profit and loss and changes in reserves.
Based on a 99% confidence level, Citi would expect two to three days in any one year where buy-and-hold losses exceeded the Regulatory VAR. Given the conservative calibration of Citi’s VAR model (as a result of taking the greater of short- and long-term volatilities and fat-tail scaling of volatilities), Citi would expect fewer exceptions under normal and stable market conditions. Periods of unstable market conditions could increase the number of back-testing exceptions.
As of September 30, 2017,2018, there was one back-testing exception observed for Citi’s Regulatory VAR for the prior 12 months. As previously disclosed, trading losses on November 14, 2016 exceeded the VAR estimate at the Citigroup level, drivenmonths, due to market moves triggered by the widening of municipal bond yields following the election resultspolitical events in the United States.

Italy.


COUNTRY RISKCountry Risk

For additional information on country risk at Citi, see “Country Risk” in Citi’s 20162017 Annual Report on Form 10-K.

Top 25 Country Exposures
The following table presents Citi’s top 25 exposures by
country (excluding the U.S.) as of September 30, 2017.2018. The total exposure as of September 30, 2018 to the top 25 countries disclosed below in combination with the U.S., would represent approximately 95% of Citi’s exposure to all countries. For
purposes of the table, loan amounts are reflected in the country
where the loan is booked, which is generally based on the
domicile of the borrower. For example, a loan to a Chinese
subsidiary of a Switzerland-based corporation will generally
be categorized as a loan in China. In addition, Citi has
developed regional booking centers in certain countries, most
significantly in the United Kingdom (U.K.) and Ireland, in
in order to more efficiently serve its corporate customers. As an
example, with respect to the U.K., only 24%28% of corporate
loans presented in the table below are to U.K. domiciled
entities (24%(29% for unfunded commitments), with the balance of
the loans predominately to European domiciled counterparties.
Approximately 80%83% of the total U.K. funded loans and 90%91% of
the total U.K. unfunded commitments were investment grade
as of September 30, 2017.2018. Trading account assets and investment securities are generally categorized based on the domicile of the issuer of the security of the underlying reference entity. For additional information on the assets included in the table, see the footnotes to the table below.
For a discussion of uncertainties arising as a result of the vote in the U.K. to withdraw’s potential exit from the EU, see “Risk Factors—Strategic Risks” in Citigroup’s 20162017 Annual Report on Form 10-K.

 
In billions of dollars
ICG
loans(1)
GCB loans(2)
Other funded(3)
Unfunded(4)
Net MTM on derivatives/repos(5)
Total hedges (on loans and CVA)
Investment securities(6)
Trading account assets(7)
Total
as of
3Q17
Total
as of
2Q17
Total
as of
4Q16
ICG
loans(1)
GCB loans
Other funded(2)
Unfunded(3)
Net MTM on derivatives/repos(4)
Total hedges (on loans and CVA)
Investment securities(5)
Trading account assets(6)
Total
as of
3Q18
Total
as of
2Q18
Total
as of
3Q17
Total as a % of Citi as of 3Q18
United Kingdom$35.0
$—
$3.5
$55.2
$10.6
$(2.5)$7.3
$1.1
$110.2
$111.8
$107.5
$40.3
$—
$8.3
$62.1
$11.6
$(3.4)$5.6
$(0.8)$123.7
$125.8
$110.2
7.7%
Mexico8.9
26.6
0.4
6.8
0.7
(0.7)13.7
6.4
62.8
61.3
52.4
9.9
26.8
0.3
7.9
0.9
(0.7)12.4
4.4
61.9
60.2
62.8
3.9
Hong Kong16.8
12.3
0.8
6.9
1.6
(0.2)6.6
1.1
45.9
45.1
40.8
2.9
Singapore14.9
12.0
0.2
5.9
0.9
(0.3)9.7
0.5
43.8
41.2
36.4
13.3
12.3
0.4
5.1
1.6
(0.2)7.9
0.6
41.0
41.2
43.8
2.6
Hong Kong15.4
10.8
1.2
6.1
1.1
(0.5)5.4
1.3
40.8
39.7
35.9
Korea2.3
18.8
0.3
3.2
2.3
(0.9)6.7
1.5
34.2
35.1
34.0
2.1
19.0
0.2
2.8
1.2
(1.1)8.8
0.7
33.7
35.0
34.2
2.1
Ireland11.5
—
0.7
15.3
0.5
—
—
0.8
28.8
28.9
24.8
12.2
—
0.8
16.7
0.5
—
—
0.9
31.1
31.3
28.8
1.9
India7.0
6.6
0.6
4.7
1.5
(1.1)8.3
1.1
28.7
33.4
30.9
4.1
6.7
0.8
5.1
2.6
(0.8)7.8
0.9
27.2
27.6
28.7
1.7
Brazil(2)
12.6
1.8
—
3.7
5.4
(2.0)3.3
3.2
28.0
27.3
28.5
12.8
—
—
3.0
4.5
(1.0)3.2
3.4
25.9
24.4
28.0
1.6
Australia4.6
10.9
—
5.7
2.2
(0.8)4.0
0.4
27.0
23.7
22.4
5.1
10.0
—
6.2
1.0
(0.4)1.8
0.4
24.1
23.2
27.0
1.5
Germany0.1
—
0.1
4.1
3.7
(3.4)9.3
5.8
19.7
16.8
18.6
1.2
China7.7
4.6
0.3
1.7
2.6
(1.0)4.0
0.9
20.8
19.4
17.2
7.4
4.7
0.4
1.9
1.5
(0.5)2.8
0.6
18.8
19.5
20.8
1.2
Japan2.4
0.1
0.1
2.7
5.4
(1.2)4.6
4.7
18.8
18.6
18.3
2.9
0.1
0.1
2.5
4.4
(1.4)4.7
5.1
18.4
15.9
18.8
1.1
Germany0.1
—
—
4.2
4.7
(2.1)9.5
2.2
18.6
19.5
16.0
Taiwan5.0
8.8
0.1
1.1
0.9
(0.2)1.4
1.4
18.5
18.4
16.6
5.1
8.9
0.1
1.1
0.4
—
1.1
1.1
17.8
19.0
18.5
1.1
Canada2.0
0.7
0.6
6.8
1.9
(0.7)4.7
—
16.0
16.3
17.0
2.3
0.7
0.5
7.4
2.3
(0.3)3.1
0.4
16.4
15.8
16.0
1.0
Poland3.3
1.9
—
3.1
0.1
(0.3)5.2
0.3
13.6
13.1
11.8
3.7
2.0
0.1
3.8
0.1
(0.1)4.0
0.8
14.4
13.0
13.6
0.9
Jersey6.6
—
0.3
3.4
—
—
—
—
10.3
10.0
4.5
0.6
United Arab Emirates5.6
1.6
0.1
2.5
0.1
(0.1)—
—
9.8
10.2
6.7
0.6
Malaysia1.4
4.6
0.3
1.6
0.1
(0.1)0.9
0.3
9.1
9.0
9.3
1.8
4.7
0.3
1.1
0.2
(0.1)1.3
0.3
9.6
9.7
9.1
0.6
Thailand0.9
2.1
0.1
2.1
0.1
—
1.1
0.6
7.0
7.0
5.8
1.2
2.4
—
1.5
—
—
1.4
0.7
7.2
6.9
7.0
0.4
United Arab Emirates3.1
1.5
0.1
2.2
0.3
(0.3)—
(0.2)6.7
6.2
6.0
Indonesia1.9
1.1
0.2
1.3
0.2
(0.2)1.3
0.4
6.2
5.7
5.2
2.2
1.0
0.1
1.3
0.1
(0.1)1.1
0.1
5.8
6.2
6.2
0.4
Luxembourg0.1
—
—
—
0.6
(0.3)5.2
0.5
6.1
5.8
5.4
—
—
—
—
0.5
(0.3)4.1
0.8
5.1
4.9
6.1
0.3
South Africa1.8
—
—
1.4
0.5
(0.1)1.5
(0.1)5.0
5.3
4.3
0.3
Philippines0.8
1.2
—
0.4
1.1
(0.1)1.4
0.1
4.9
5.2
3.6
0.3
Russia2.1
1.0
—
1.0
0.2
(0.2)0.8
0.1
5.0
4.7
5.3
1.8
0.9
—
0.8
0.1
(0.1)0.7
(0.1)4.1
4.6
5.0
0.3
Colombia(2)
1.9
1.6
—
1.0
0.3
(0.1)0.3
(0.1)4.9
5.3
5.6
Jersey2.9
—
—
1.6
—
—
—
—
4.5
4.1
3.7
Argentina1.9
—
—
0.1
1.2
(0.4)0.4
1.1
4.3
3.0
2.2
South Africa1.5
—
—
1.0
0.7
(0.3)1.4
—
4.3
3.9
3.9
Italy0.2
—
—
2.3
5.0
(4.3)—
0.5
3.7
3.2
3.1
0.2
Total  36.4%

(1)
ICG loans reflect funded corporate loans and private bank loans, net of unearned income. As of September 30, 2017,2018, private bank loans in the table above totaled $23.3$24.5 billion, concentrated in Singapore ($7.2 billion), Hong Kong ($6.57.0 billion), Singapore ($6.8 billion) and the U.K. ($5.46.1 billion).                     


(2)
GCB loans include funded loans in Brazil and Colombia related to businesses that were transferred to Corporate/Other as of January 1, 2016 (Brazil GCB loans are recorded as HFS in Other assets on the Consolidated Balance Sheet).
(3)
Other funded includes other direct exposure such as accounts receivable, loans held-for-sale,HFS, other loans in Corporate/Other and investments accounted for under the equity method.                                        


(4)(3)Unfunded exposure includes unfunded corporate lending commitments, letters of credit and other contingencies.            
(5)(4)Net mark-to-market (MTM) counterparty risk on OTC derivatives and securities lending / lending/borrowing transactions (repos). Exposures are shown net of collateral and inclusive of CVA. Includes margin loans.
(6)(5)Investment securities include securities available-for-sale, recorded at fair market value, and securities held-to-maturity, recorded at historical cost.    
(7)(6)Trading account assets are shown on a net basis and include issuer risk on cash products and derivative exposure where the underlying reference entity/issuer is located in that country.



INCOME TAXES

Deferred Tax Assets
For additional information on Citi’s deferred tax assets (DTAs), see “Risk Factors—Strategic Risks,” “Significant Accounting Policies and Significant Estimates—Income Taxes” and NoteNotes 1 and 9 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
At September 30, 2017,2018, Citigroup had recorded net DTAs of approximately $45.5$23.0 billion, a decreasean increase of $0.3$0.1 billion from June 30, 20172018 and $1.2an increase of $0.5 billion from December 31, 2016.2017. The DTA reductionsincrease for the three and nine months ended September 30, 2017 werequarter was primarily driven by losses in Other comprehensive income, partially offset by earnings. The increase for the nine months was primarily driven by losses in Other comprehensive income and adoption of ASU 2016-16 (see Note 1 to the Consolidated Financial Statements), partially offset by earnings.
The following table below summarizes Citi’s net DTAs balance. Of Citi’s net DTAs as of September 30, 2017,2018, those arising from net operating losses, foreign tax credit and general business credit carry-forwards are 100% deducted in calculating Citi’s regulatory capital, while DTAs arising from temporary differences are deducted from regulatory capital if in excess of the 10%/15% limitations.
Despite the $0.5 billion increase in net DTAs from December 31, 2017, Citi was able to reduce the amount of DTAs arising from net operating losses, foreign tax credits and general business credit carry-forwards by $0.7 billion, thereby reducing the amount of DTAs that was excluded from Common Equity Tier 1 Capital from $12.3 billion to $11.6 billion as of September 30, 2018. There were no DTAs in excess of the 10%/15% limitations as of September 30, 2018, (see “Capital Resources” above). Approximately $17.6Thus, approximately $11.4 billion of the net DTADTAs was not deducted in calculating regulatory capital pursuant to full Basel III implementation standards as of September 30, 2017.2018, and was appropriately risk weighted as per those rules.
Jurisdiction/ComponentDTAs balanceDTAs balance
In billions of dollarsSept. 30, 2017Dec. 31, 2016September 30,
2018		December 31, 2017
Total U.S.$43.2
$44.6
$20.4
$19.9
Total foreign2.3
2.1
2.6
2.6
Total$45.5
$46.7
$23.0
$22.5


 


Effective Tax Rate
Citi’s effective tax rate for the third quarter of 20172018 was 31.1%24.1%, as compared with 30.8%31.1% in the third quarter of 2016.2017. The decrease in the effective tax rate was primarily due to the lower U.S. federal statutory tax rate pursuant to Tax Reform.

SEC Staff Accounting Bulletin 118
Citi’s third quarter of 2018 tax provision did not include any changes to Citi’s provisional income tax estimates recorded in the fourth quarter of 2017. The U.S. Treasury issued certain U.S. tax reform guidance through September 30, 2018 and it is anticipated that additional guidance will be issued by the end of 2018. Citi expects to complete its analysis within the one-year measurement period and record final adjustments to the provisional income tax estimates during the fourth quarter of 2018.








FUTURE APPLICATION OF ACCOUNTING STANDARDS

Accounting for Financial Instruments—Credit Losses
In June 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-13, Financial Instruments—Credit Losses(Topic 326). The ASU introduces a new credit loss methodology, the Current Expected Credit Losses (CECL) methodology, which requires earlier recognition of credit losses, while also providing additional transparency about credit risk.
The CECL methodology utilizes a lifetime “expected credit loss” measurement objective for the recognition of credit losses for loans, held-to-maturity debt securities and other receivables at the time the financial asset is originated or acquired. The expected credit losses (ECL) are adjusted each period for changes in expected lifetime credit losses. This methodology replaces the multiple existing impairment methods in current GAAP, which generally require that a loss be incurred before it is recognized. For available-for-sale debt securities where fair value is less than cost, credit-related impairment, if any, will be recognized through an allowance for credit losses and adjusted each period for changes in credit risk.
The CECL methodology represents a significant change from existing GAAP and may result in material changes to the Company’s accounting for financial instruments. The Company is evaluating the effect that ASU 2016-13 will have on its Consolidated Financial Statements and related disclosures. The impact of the ASU will depend upon the state of the economy and the nature of Citi’s portfolios at the date of adoption. Based on a preliminary analysis performed in 2018 and the environment and portfolios at that time, the overall impact is estimated to be an approximate 10% to 20% increase in credit loss reserves. However, there are still some implementation questions to be resolved by the FASB that could affect the estimated impact, including (i) the amounts and types of recoveries that can be included in expected credit loss estimates and (ii) whether recovery inputs can be discounted under a non-discounted cash flow approach to estimating expected credit losses.
The ASU will be effective for Citi as of January 1, 2020. For additional information, see “Capital Resources—Regulatory Capital Treatment—Implementation and Transition of the Current Expected Credit Losses (CECL) Methodology” in the First Quarter of 2018 Form 10-Q.

Lease Accounting
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which is intended to increase transparency and comparability of accounting for lease transactions. The ASU will require lessees to recognize leases on the balance sheet as lease assets and lease liabilities and will require both quantitative and qualitative disclosures regarding key information about leasing arrangements. Lessor accounting is largely unchanged. The guidance is effective beginning January 1, 2019 and will be adopted prospectively with a cumulative adjustment to Retained earnings. The Company estimates that upon adoption, its Consolidated Balance Sheet
will have an approximate $5 billion increase in assets and liabilities. Additionally, the Company estimates an approximate $140 million increase in retained earnings due to the cumulative effect of recognizing previously deferred gains on sale/leaseback transactions.

Subsequent Measurement of Goodwill
In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The ASU simplifies the subsequent measurement of goodwill impairment by eliminating the requirement to calculate the implied fair value of goodwill (i.e., the current Step 2 of the goodwill impairment test) to measure a goodwill impairment charge. Under the ASU, the impairment test is the comparison of the fair value of a reporting unit with its carrying amount (the current Step 1), with the impairment charge being the deficit in fair value but not exceeding the total amount of goodwill allocated to that reporting unit. The simplified one-step impairment test applies to all reporting units (including those with zero or negative carrying amounts).
The ASU will be effective for Citi as of January 1, 2020. The impact of the ASU will depend upon the performance of Citi’s reporting units and the market conditions impacting the fair value of each reporting unit going forward.

Fair Value Measurement
In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The amendments modify certain disclosure requirements for fair value measurements and are effective January 1, 2020, with early adoption permitted. Adoption of this standard is not expected to have a material impact on the Company.

See Note 1 to the Consolidated Financial Statements for a discussion of “Accounting Changes.”



DISCLOSURE CONTROLS AND PROCEDURES
Citi’s disclosure controls and procedures are designed to ensure that information required to be disclosed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, including without limitation that information required to be disclosed by Citi in its SEC filings is accumulated and communicated to management, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate, to allow for timely decisions regarding required disclosure.
Citi’s Disclosure Committee assists the CEO and CFO in their responsibilities to design, establish, maintain and evaluate the effectiveness of Citi’s disclosure controls and procedures. The Disclosure Committee is responsible for, among other things, the oversight, maintenance and implementation of the disclosure controls and procedures, subject to the supervision and oversight of the CEO and CFO.
Citi’s management, with the participation of its CEO and CFO, has evaluated the effectiveness of Citigroup’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of September 30, 20172018 and, based on that evaluation, the CEO and CFO have concluded that at that date, Citigroup’s disclosure controls and procedures were effective.

DISCLOSURE PURSUANT TO SECTION 219 OF THE IRAN THREAT REDUCTION AND SYRIA HUMAN RIGHTS ACT

Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, which added Section 13(r) to the Securities Exchange Act of 1934, as amended, Citi is required to disclose in its annual or quarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with individuals or entities that are subject to sanctions under U.S. law. Disclosure is generally required even where the activities, transactions or dealings were conducted in compliance with applicable law. Citi disclosed reportable activities pursuant to Section 219 in the first and second quartersquarter of 20172018 in the FirstSecond Quarter of 20172018 Form 10-Q and Second Quarter Form 10-Q, respectively.10-Q.
During the third quarter of 2017,2018, Bank Handlowy w Warszawie S.A., a Citibank subsidiary located in Poland, processed threea funds transferstransfer involving the Iranian Embassy in Poland.  The value of  the funds transferstransfer was EUR 50, EUR 50, and EU 100100.00 (approximately $60.00, $60.00 and $117.00), respectively.USD 116.54). In addition, a branch of Citibank N.A., located in India Branch, processed a funds transferpayment involving the Iran Consulate General of Iran in India. The total value of thisthe payment was INR 1,3688,200.00 (approximately $21.00)USD 111.62). These payments were for visa-relatedvisa- and passport-related fees and Iran-related travel respectively, both of which are permissible under the travel exemption in the Iranian Transactions and Sanctions Regulations. Citibank realized nominal fees for the processing of these payments. 



 







FORWARD-LOOKING STATEMENTS

Certain statements in this Form 10-Q, including but not limited to statements included within the Management’s Discussion and Analysis of Financial Condition and Results of Operations, are “forward-looking statements” within the meaning of the rules and regulations of the SEC. In addition, Citigroup also may make forward-looking statements in its other documents filed or furnished with the SEC, and its management may make forward-looking statements orally to analysts, investors, representatives of the media and others.
Generally, forward-looking statements are not based on historical facts but instead represent Citigroup’s and its management’s beliefs regarding future events. Such statements may be identified by words such as believe, expect, anticipate, intend, estimate, may increase, may fluctuate, target, illustrative, and similar expressions or future or conditional verbs such as will, should, would and could.
Such statements are based on management’s current expectations and are subject to risks, uncertainties and changes in circumstances. Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors, including without limitation (i) the precautionary statements included within each individual business’s discussion and analysis of its results of operations above and in Citi’s 20162017 Annual Report on Form 10-K, First Quarter of 20172018 Form 10-Q and Second Quarter of 20172018 Form 10-Q; (ii) the factors listed and described under “Risk Factors” in Citi’s 20162017 Annual Report on Form 10-K; and (iii) the risks and uncertainties summarized below:

Citi’s ability to address (i) the shortcomings identified by the Federal Reserve Board and FDIC as a result of their review of Citi’s 2015 annual resolution plan submission as well as (ii) the 2017 resolution plan guidance in Citi’s 2017 resolution plan submission;
the potential impact on Citi’s ability to return capital to common shareholders, consistent with its capital optimization efforts and targets, due to, among other things, Citi’s results of operations, Citi’s ability to effectively manage its level of risk weighted assets and GSIB surcharge, potential changes to the regulatory capital framework, the CCAR process and the results of regulatory stress tests or any changes to the stress testing and CCAR requirements or process, such as the proposed introduction of a firm-specific “stress capital buffer” or incorporation(SCB), including as a result of any year-to-year variability resulting from the SCB and the impact on Citi’s then-effective GSIB surcharge into its post-stress test minimum capital requirements or the introduction of additional macroprudential considerations such as funding and liquidity shocks in the stress testing process;estimated management buffer;
the ongoing regulatory and other uncertainties and changes faced by financial institutions, including Citi, in the U.S. and globally, including, among others, uncertainties and potential changes arising from the U.S. presidential administration and Congress, potential changes to various aspects of the regulatory capital framework, and the terms of and other uncertainties resulting from the U.K.’s process to withdraw from the European Union, and the potential impact these uncertainties and changes could have on Citi’s businesses, results of operations, financial condition, strategy or organizational structure and compliance risks and costs;
the numerous uncertainties arising as a result of the process in the U.K. to withdraw from the European Union, including the terms of the withdrawal, and the potential impact to macroeconomic conditions as well as
Citi’s legal entity structure and overall results of operations or financial condition;
the potential impact to financial institutions, including Citi, as a result of the uncertainties associated with the level and pace of any changes in interest rates or any balance sheet normalization program implemented by the Federal Reserve Board or other central banks;
the impact on the value of Citi’s DTAs and on Citi’s net income or regulatory capital if corporate tax rates in the U.S. or certain state, local or foreign jurisdictions are reduced, or if other changes are made to the U.S. corporate tax system (whether as a result of current efforts by the U.S. presidential administration and Congress or otherwise), including a potential change to a territorial system or a one-time mandatory deemed repatriation of all untaxed non-U.S. earnings at a significantly lower rate;
Citi’s ability to continue to utilize its remaining DTAs (including the foreign tax credit component of its DTAs) and thus reduce the negative impact of the DTAs on Citi’s regulatory capital, including as a result of movementsits ability to generate U.S. taxable income and by the provisions of and guidance issued in Citi’s AOCI, which can be impacted by changes in interest rates and foreign exchange rates;connection with Tax Reform;
the potential impact to Citi if its interpretation or application of the extensivecomplex tax laws to which it is subject, such as withholding tax obligations and stamp and other transactional taxes, differs from those of the relevant governmental authorities;
Citi’s ability to achieve theits expected returns on itsresults from ongoing investments in its businesses or meet itsand efficiency initiatives, including revenue growth, as part of Citi’s operational orand financial objectives orand targets, including as a result of factors that Citi cannot control;
the potential negative impact to Citi’sfrom declining sales and revenues or other difficulties of any retailer or merchant with whom Citi has a co-branding andor private label credit card relationshipsrelationship, such as wellSears, including as Citi’s resultsa result of operationsaccelerated store closures, termination of a particular relationship, external factors outside the control of either party to the relationship, such as the general economic environment, or financial condition,other factors, including bankruptcies, liquidations, consolidations and other similar events, and the potential negative impact any such event could have on Citi retail services, including as a result of loss of revenues, higher cost of credit, impairment of purchased credit card relationships and contract relatedcontract-related intangibles or other losses, duelosses;
the potential impact to among other things, operational difficultiesCiti’s businesses, including funding costs, level and mix of a particular retailer or merchant or early termination of a particular relationship, or external factors, including bankruptcies, liquidations, consolidationsdeposits and other similar events;products and net interest revenues, from ongoing increases in interest rates;
the potential impact to Citi’s businesses, credit costs, deposits and overallrevenues or other results of operations and financial condition as a result of macroeconomic and geopolitical challenges and uncertainties and volatility, including, those relating to geopolitical tensionsamong others, potential policy and/or regulatory changes arising from a new administration in Asia and Latin America, economic growth rates inMexico, the implementation of protectionist trade or other related policies by the U.S. and non-U.S. jurisdictions, potentialand/or other countries, governmental fiscal or otherand monetary actions, or the pursuit of protectionist trade and other policiesexpected actions, such as any balance sheet normalization program implemented by the U.S.;
Federal Reserve Board or other central banks, any agreement, or lack thereof, for the U.K. to withdraw from the European Union, or geopolitical disputes;
the various risks faced by Citi as a result of its presence in the emerging markets, including, among others, sanctions or asset freezes, fraud,sovereign volatility, political events, foreign exchange controls, limitations on foreign investment, sociopolitical instability (including from hyper-inflation), fraud, nationalization or loss of licenses, business restrictions, sanctions or asset freezes, potential criminal charges, closure of branches or subsidiaries and confiscation of assets as well as the increased compliance, regulatory and legal risks and costs;
Citi’s ability in its resolution plan submissions to address any deficiencies identified or future guidance, including any final 2019 resolution plan guidance, provided by the Federal Reserve Board and FDIC;
the potential impact on Citi’s performance, including its competitive position and ability to effectively manage its businesses and continue to execute its strategies, if Citi is


the uncertainties regarding the consequences of noncomplianceunable to hire and the potential impact on retain highly qualified employees for any reason;
Citi’s estimates of its eligible debt arising from the Federal Reserve Board’s final total loss-absorbing capacity (TLAC) rules;ability to effectively compete with U.S. and non-U.S. financial services companies and others;
the potential impact of concentrations of risk, such as credit and market risk arising from Citi’sthe size and volume of Citi’s transactions with counterparties in the public sector, including the U.S. government and its agencies, or in the financial services industry, on Citi’s hedging strategies and results of operations;
the potential impacts on Citi’s liquidity and/or costs of funding as a result of external factors, including, among others, market disruptions and governmental fiscal and monetary policies as well as regulatory changes or negative investor perceptions of Citi’s creditworthiness;
the impact of ratings downgrades of Citi or one or more of its more significant subsidiaries or issuing entities on Citi’s funding and liquidity as well as the results of operations of certain of its businesses;
the potential impact to Citi from a disruption of its operational systems, including as a result of, among other things, human error, fraud or malice, accidental technological failure, electrical or telecommunication outages or failure of computer servers;servers, or other similar damage to Citi’s property or assets, or failures by third parties with whom Citi does business, as well as disruptions in the operations of Citi’s clients, customers or other third parties;
the increasing risk of continually evolving, sophisticated cybersecurity risks faced by financial institutions, including Citi and third parties with whom it does business, and others (such as theft of funds or theft, loss, misuse or disclosure of confidential client, customer, corporate or network information or assets and other attempts by unauthorized parties to disrupt computer and network systems), and the potential impact from such risks, including, among others, reputational damage with clients, customers and others, lost revenues, additional costs (including credit, remediation and other costs), regulatory penalties and inquiries, legal exposure and other financial losses;
the potential impact of incorrect assumptions or estimates in Citi’s financial statements or the impact of ongoing changes to financial accounting and reporting standards or interpretations, such as the FASB’s new accounting standard on credit losses, on how Citi records and reports its financial condition and results of operations;
the potential impact to Citi’s results of operations and/or regulatory capital and capital ratios if Citi’s risk management process, strategies or models, including those related to its ability to manage and aggregate data, are deficient or ineffective, require refinement, modification or enhancement or any approval is withdrawn by Citi’s U.S. banking regulators;
the potential impact to Citi of ongoing implementation and interpretation of regulatory changes and requirements in the U.S. and globally, such as on Citi’s compliance risks and costs, including reputational and legal risks as
well as remediation and other financial costs, such as penalties and fines; and
the potential outcomes of the extensive legal and regulatory proceedings, investigations and other inquiries to which Citi is or may be subject at any given time, particularly given the increased focus on conduct risk and the severity of the remedies sought and potential collateral consequences to Citi arising from such outcomes;
the potential impact to Citi’s results of operations and/or regulatory capital and capital ratios if Citi’s risk models, including its Basel III risk-weighted asset models, are ineffective, require refinement, modification or enhancement or approval is withdrawn by Citi’s U.S. banking regulators;
the potential impact on Citi’s performance, including its competitive position and ability to effectively manage its businesses and continue to execute its strategy, if Citi is unable to hire and retain highly qualified employees for any reason; and
the potential impact to Citi’s businesses, credit costs and overall results of operations and financial condition as a result of natural disasters.outcomes.

Any forward-looking statements made by or on behalf of Citigroup speak only as to the date they are made, and Citi does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.



























































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FINANCIAL STATEMENTS AND NOTES TABLE OF CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS 
Consolidated Statement of Income (Unaudited)—
For the Three and Nine Months Ended September 30, 20172018 and 20162017
9382
Consolidated Statement of Comprehensive Income (Unaudited)—For the Three and Nine Months Ended September 30, 20172018 and 20162017
9483
Consolidated Balance Sheet—September 30, 20172018 (Unaudited) and December 31, 20162017
9584
Consolidated Statement of Changes in Stockholders’ Equity (Unaudited)—For the Three and Nine Months Ended September 30, 20172018 and 20162017
9786
Consolidated Statement of Cash Flows (Unaudited)—
For the Nine Months Ended September 30, 20172018 and 20162017
9988

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 
Note 1—Basis of Presentation and Accounting Changes
10190
Note 2—Discontinued Operations and Significant Disposals
10493
Note 3—Business Segments
10694
Note 4—Interest Revenue and Expense
10795
Note 5—Commissions and Fees; Administration and Other
                 Fiduciary Fees
10896
Note 6—Principal Transactions
10899
Note 7—Incentive Plans
109100
Note 8—Retirement Benefits
109100
Note 9—Earnings per Share
114105
Note 10—Federal Funds, Securities Borrowed, Loaned and
Subject to Repurchase Agreements
115106
Note 11—Brokerage Receivables and Brokerage Payables
118109
Note 12—Investments
119110
 


  
Note 13—Loans
131123
Note 14—Allowance for Credit Losses
144136
Note 15—Goodwill and Intangible Assets
146138
Note 16—Debt
148140
Note 17—Changes in Accumulated Other Comprehensive
Income (Loss) (AOCI)
149141
Note 18—Securitizations and Variable Interest Entities
155147
Note 19—Derivatives Activities
163156
Note 20—Fair Value Measurement
173167
Note 21—Fair Value Elections
192186
Note 22—Guarantees and Commitments
196190
Note 23—Contingencies
201195
Note 24—Condensed Consolidating Financial Statements
203197




CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) Citigroup Inc. and Subsidiaries
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars, except per share amounts2018201720182017
Revenues   
 
Interest revenue$18,170
$15,914
$52,052
$45,729
Interest expense6,368
4,379
17,413
11,981
Net interest revenue$11,802
$11,535
$34,639
$33,748
Commissions and fees$2,803
$3,241
$8,944
$9,552
Principal transactions2,566
2,248
8,006
7,985
Administration and other fiduciary fees911
929
2,750
2,672
Realized gains on sales of investments, net69
213
341
626
Impairment losses on investments   
 
Gross impairment losses(70)(15)(113)(47)
Net impairment losses recognized in earnings$(70)$(15)$(113)$(47)
Other revenue$308
$268
$1,163
$404
Total non-interest revenues$6,587
$6,884
$21,091
$21,192
Total revenues, net of interest expense$18,389
$18,419
$55,730
$54,940
Provisions for credit losses and for benefits and claims   
 
Provision for loan losses$1,906
$2,146
$5,504
$5,487
Policyholder benefits and claims26
28
73
81
Provision (release) for unfunded lending commitments42
(175)66
(190)
Total provisions for credit losses and for benefits and claims$1,974
$1,999
$5,643
$5,378
Operating expenses   
 
Compensation and benefits$5,319
$5,304
$16,578
$16,301
Premises and equipment565
608
1,728
1,832
Technology/communication1,806
1,764
5,361
5,122
Advertising and marketing378
417
1,170
1,222
Other operating2,243
2,324
7,111
7,423
Total operating expenses$10,311
$10,417
$31,948
$31,900
Income from continuing operations before income taxes$6,104
$6,003
$18,139
$17,662
Provision for income taxes1,471
1,866
4,356
5,524
Income from continuing operations$4,633
$4,137
$13,783
$12,138
Discontinued operations   
 
Loss from discontinued operations$(8)$(9)$(17)$(4)
Benefit for income taxes—
(4)(17)(2)
Loss from discontinued operations, net of taxes$(8)$(5)$—
$(2)
Net income before attribution of noncontrolling interests$4,625
$4,132
$13,783
$12,136
Noncontrolling interests3
(1)51
41
Citigroup’s net income$4,622
$4,133
$13,732
$12,095
Basic earnings per share(1)
   
 
Income from continuing operations$1.74
$1.42
$5.04
$4.05
Income from discontinued operations, net of taxes—
—
—
—
Net income$1.73
$1.42
$5.04
$4.05
Weighted average common shares outstanding (in millions)
2,479.8
2,683.6
2,524.1
2,729.3
Diluted earnings per share(1)
   
 
Income from continuing operations$1.74
$1.42
$5.04
$4.05
Income (loss) from discontinued operations, net of taxes—
—
—
—
Net income$1.73
$1.42
$5.04
$4.05
Adjusted weighted average common shares outstanding
  (in millions)
2,481.4
2,683.7
2,525.5
2,729.5
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars, except per share amounts2017201620172016
Revenues   
 
Interest revenue$15,821
$14,653
$45,445
$43,176
Interest expense4,379
3,174
11,981
9,234
Net interest revenue$11,442
$11,479
$33,464
$33,942
Commissions and fees$2,931
$2,644
$8,627
$7,832
Principal transactions2,170
2,238
7,754
5,894
Administration and other fiduciary fees1,010
862
2,906
2,551
Realized gains on sales of investments, net213
287
626
673
Other-than-temporary impairment losses on investments   
 
Gross impairment losses(15)(32)(47)(615)
Less: Impairments recognized in AOCI—
—
—
—
Net impairment losses recognized in earnings$(15)$(32)$(47)$(615)
Insurance premiums$166
$184
$491
$665
Other revenue256
98
373
1,921
Total non-interest revenues$6,731
$6,281
$20,730
$18,921
Total revenues, net of interest expense$18,173
$17,760
$54,194
$52,863
Provisions for credit losses and for benefits and claims   
 
Provision for loan losses$2,146
$1,746
$5,487
$5,022
Policyholder benefits and claims28
35
81
172
Release for unfunded lending commitments(175)(45)(190)(4)
Total provisions for credit losses and for benefits and claims$1,999
$1,736
$5,378
$5,190
Operating expenses   
 
Compensation and benefits$5,304
$5,203
$16,301
$15,988
Premises and equipment608
624
1,832
1,917
Technology/communication1,759
1,694
5,108
5,000
Advertising and marketing417
403
1,222
1,226
Other operating2,083
2,480
6,691
7,165
Total operating expenses$10,171
$10,404
$31,154
$31,296
Income from continuing operations before income taxes$6,003
$5,620
$17,662
$16,377
Provision for income taxes1,866
1,733
5,524
4,935
Income from continuing operations$4,137
$3,887
$12,138
$11,442
Discontinued operations   
 
Loss from discontinued operations$(9)$(37)$(4)$(76)
Benefit for income taxes(4)(7)(2)(21)
Loss from discontinued operations, net of taxes$(5)$(30)$(2)$(55)
Net income before attribution of noncontrolling interests$4,132
$3,857
$12,136
$11,387
Noncontrolling interests(1)17
41
48
Citigroup’s net income$4,133
$3,840
$12,095
$11,339
Basic earnings per share(1)
   
 
Income from continuing operations$1.42
$1.25
$4.05
$3.60
Income (loss) from discontinued operations, net of taxes—
(0.01)—
(0.02)
Net income$1.42
$1.24
$4.05
$3.58
Weighted average common shares outstanding2,683.6
2,879.9
2,729.3
2,912.9


Diluted earnings per share(1)
   
 
Income from continuing operations$1.42
$1.25
$4.05
$3.60
Income (loss) from discontinued operations, net of taxes—
(0.01)—
(0.02)
Net income$1.42
$1.24
$4.05
$3.58
Adjusted weighted average common shares outstanding2,683.7
2,880.1
2,729.5
2,913.0
(1)Due to rounding, earnings per share on continuing operations and discontinued operations may not sum to earnings per share on net income.
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.



CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Citigroup Inc. and Subsidiaries
(UNAUDITED)  
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
Citigroup’s net income$4,133
$3,840
$12,095
$11,339
$4,622
$4,133
$13,732
$12,095
Add: Citigroup's other comprehensive income   




   
  
Net change in unrealized gains and losses on investment securities,
net of taxes(1)
$(66)$(432)$127
$2,529
Net change in unrealized gains and losses on investment
securities, net of taxes(1)(2)
$(605)$(66)$(2,161)$127
Net change in debt valuation adjustment (DVA), net of taxes(1)
(123)(200)(267)5
(287)(123)159
(267)
Net change in cash flow hedges, net of taxes8
(83)123
385
(74)8
(397)123
Benefit plans liability adjustment, net of taxes(29)12
(176)(480)26
(29)415
(176)
Net change in foreign currency translation adjustment, net of taxes and hedges218
(375)2,179
(273)(221)218
(1,968)2,179
Citigroup’s total other comprehensive income$8
$(1,078)$1,986
$2,166
Net change in excluded component of fair value hedges, net of
taxes

10
—
(22)—
Citigroup’s total other comprehensive income (loss)$(1,151)$8
$(3,974)$1,986
Citigroup’s total comprehensive income$4,141
$2,762
$14,081
$13,505
$3,471
$4,141
$9,758
$14,081
Add: Other comprehensive income attributable to noncontrolling interests$12
$10
$82
$(13)$8
$12
$(35)$82
Add: Net income attributable to noncontrolling interests(1)17
41
48
3
(1)51
41
Total comprehensive income$4,152
$2,789
$14,204
$13,540
$3,482
$4,152
$9,774
$14,204
(1)See Note 1 to the Consolidated Financial Statements.
(2)For the three and nine months ended September 30, 2018, respectively, amount represents the net change in unrealized gains and losses on available-for-sale (AFS) debt securities. Effective January 1, 2018, the AFS category is eliminated for equity securities under ASU 2016-01.

The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.



CONSOLIDATED BALANCE SHEET Citigroup Inc. and Subsidiaries
September 30, September 30, 
2017December 31,2018December 31,
In millions of dollars(Unaudited)2016(Unaudited)2017
Assets 
 
 
 
Cash and due from banks (including segregated cash and other deposits)$22,604
$23,043
$25,727
$23,775
Deposits with banks163,505
137,451
173,559
156,741
Federal funds sold and securities borrowed or purchased under agreements to resell (including $156,332 and $133,204 as of September 30, 2017 and December 31, 2016, respectively, at fair value)252,608
236,813
Federal funds sold and securities borrowed and purchased under agreements to resell (including $178,442 and $132,949 as of September 30, 2018 and December 31, 2017, respectively, at fair value)280,941
232,478
Brokerage receivables38,076
28,887
40,679
38,384
Trading account assets (including $99,225 and $80,986 pledged to creditors at September 30, 2017 and December 31, 2016, respectively)258,907
243,925
Trading account assets (including $107,753 and $99,460 pledged to creditors at September 30, 2018 and December 31, 2017, respectively)257,502
252,790
Investments:  
Available for sale (including $9,599 and $8,239 pledged to creditors as of September 30, 2017 and December 31, 2016, respectively)295,315
299,424
Held to maturity (including $301 and $843 pledged to creditors as of September 30, 2017 and December 31, 2016, respectively)51,527
45,667
Non-marketable equity securities (including $1,300 and $1,774 at fair value as of September 30, 2017 and December 31, 2016, respectively)7,832
8,213
Available-for-sale debt securities (including $7,854 and $9,493 pledged to creditors as of September 30, 2018 and December 31, 2017, respectively)284,782
290,725
Held-to-maturity debt securities (including $1,073 and $435 pledged to creditors as of September 30, 2018 and December 31, 2017, respectively)53,249
53,320
Equity securities (including $1,388 and $1,395 at fair value as of September 30, 2018 and December 31, 2017, respectively, of which $189 was available for sale as of December 31, 2017)7,482
8,245
Total investments$354,674
$353,304
$345,513
$352,290
Loans: 
 
 
 
Consumer (including $27 and $29 as of September 30, 2017 and December 31, 2016, respectively, at fair value)325,576
325,063
Corporate (including $4,281 and $3,457 as of September 30, 2017 and December 31, 2016, respectively, at fair value)327,607
299,306
Consumer (including $21 and $25 as of September 30, 2018 and December 31, 2017, respectively, at fair value)325,469
333,656
Corporate (including $4,218 and $4,349 as of September 30, 2018 and December 31, 2017, respectively, at fair value)349,440
333,378
Loans, net of unearned income$653,183
$624,369
$674,909
$667,034
Allowance for loan losses(12,366)(12,060)(12,336)(12,355)
Total loans, net$640,817
$612,309
$662,573
$654,679
Goodwill22,345
21,659
22,187
22,256
Intangible assets (other than MSRs)4,732
5,114
4,598
4,588
Mortgage servicing rights (MSRs)553
1,564
618
558
Other assets (including $20,424 and $15,729 as of September 30, 2017 and December 31, 2016, respectively, at fair value)130,312
128,008
Other assets (including $25,151 and $18,559 as of September 30, 2018 and December 31, 2017, respectively, at fair value)111,268
103,926
Total assets$1,889,133
$1,792,077
$1,925,165
$1,842,465

The following table presents certain assets of consolidated variable interest entities (VIEs), which are included in the Consolidated Balance Sheet above. The assets in the table below include those assets that can only be used to settle obligations of consolidated VIEs, presented on the following page, and are in excess of those obligations. Additionally, the assets in the table below include third-party assets of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation.
September 30, September 30, 
2017December 31,2018December 31,
In millions of dollars(Unaudited)2016(Unaudited)2017
Assets of consolidated VIEs to be used to settle obligations of consolidated VIEs 
 
 
 
Cash and due from banks$107
$142
$40
$52
Trading account assets1,437
602
722
1,129
Investments2,584
3,636
2,276
2,498
Loans, net of unearned income 
 
 
 
Consumer52,521
53,401
48,678
54,656
Corporate19,908
20,121
17,971
19,835
Loans, net of unearned income$72,429
$73,522
$66,649
$74,491
Allowance for loan losses(1,943)(1,769)(1,876)(1,930)
Total loans, net$70,486
$71,753
$64,773
$72,561
Other assets142
158
167
154
Total assets of consolidated VIEs to be used to settle obligations of consolidated VIEs$74,756
$76,291
$67,978
$76,394
Statement continues on the next page.


CONSOLIDATED BALANCE SHEET                             Citigroup Inc. and Subsidiaries
(Continued)
September 30, September 30, 
2017December 31,2018December 31,
In millions of dollars, except shares and per share amounts(Unaudited)2016(Unaudited)2017
Liabilities 
 
 
 
Non-interest-bearing deposits in U.S. offices$127,220
$136,698
$111,446
$126,880
Interest-bearing deposits in U.S. offices (including $314 and $434 as of September 30, 2017 and December 31, 2016, respectively, at fair value)315,556
300,972
Interest-bearing deposits in U.S. offices (including $354 and $303 as of September 30, 2018 and December 31, 2017, respectively, at fair value)351,291
318,613
Non-interest-bearing deposits in offices outside the U.S.84,178
77,616
83,200
87,440
Interest-bearing deposits in offices outside the U.S. (including $1,183 and $778 as of September 30, 2017 and December 31, 2016, respectively, at fair value)437,084
414,120
Interest-bearing deposits in offices outside the U.S. (including $1,086 and $1,162 as of September 30, 2018 and December 31, 2017, respectively, at fair value)459,239
426,889
Total deposits$964,038
$929,406
$1,005,176
$959,822
Federal funds purchased and securities loaned or sold under agreements to repurchase (including $45,325 and $33,663 as of September 30, 2017 and December 31, 2016, respectively, at fair value)161,282
141,821
Federal funds purchased and securities loaned and sold under agreements to repurchase (including $48,148 and $40,638 as of September 30, 2018 and December 31, 2017, respectively, at fair value)175,915
156,277
Brokerage payables63,205
57,152
73,346
61,342
Trading account liabilities138,820
139,045
147,652
125,170
Short-term borrowings (including $4,827 and $2,700 as of September 30, 2017 and December 31, 2016, respectively, at fair value)38,149
30,701
Long-term debt (including $30,826 and $26,254 as of September 30, 2017 and December 31, 2016, respectively, at fair value)232,673
206,178
Other liabilities (including $15,144 and $10,796 as of September 30, 2017 and December 31, 2016, respectively, at fair value)62,344
61,631
Short-term borrowings (including $5,041 and $4,627 as of September 30, 2018 and December 31, 2017, respectively, at fair value)33,770
44,452
Long-term debt (including $36,771 and $31,392 as of September 30, 2018 and December 31, 2017, respectively, at fair value)235,270
236,709
Other liabilities (including $19,947 and $13,961 as of September 30, 2018 and December 31, 2017, respectively, at fair value)56,173
57,021
Total liabilities$1,660,511
$1,565,934
$1,727,302
$1,640,793
Stockholders’ equity 
 
 
 
Preferred stock ($1.00 par value; authorized shares: 30 million), issued shares: 770,120 as of September 30, 2017 and as of December 31, 2016, at aggregate liquidation value
$19,253
$19,253
Common stock ($0.01 par value; authorized shares: 6 billion), issued shares: 3,099,523,273 and 3,099,482,042 as of September 30, 2017 and December 31, 2016
31
31
Preferred stock ($1.00 par value; authorized shares: 30 million), issued shares: as of September 30, 2018—761,400 and as of December 31, 2017—770,120, at aggregate liquidation value
$19,035
$19,253
Common stock ($0.01 par value; authorized shares: 6 billion), issued shares: as of September 30, 2018—3,099,567,177 and as of December 31, 2017—3,099,523,273
31
31
Additional paid-in capital107,896
108,042
107,825
108,008
Retained earnings155,174
146,477
148,436
138,425
Treasury stock, at cost: September 30, 2017—455,521,274 shares and December 31, 2016—327,090,192 shares
(24,829)(16,302)
Treasury stock, at cost: September 30, 2018—657,430,364 shares and
December 31, 2017—529,614,728 shares
(39,678)(30,309)
Accumulated other comprehensive income (loss) (AOCI)(29,891)(32,381)(38,645)(34,668)
Total Citigroup stockholders’ equity$227,634
$225,120
$197,004
$200,740
Noncontrolling interest988
1,023
859
932
Total equity$228,622
$226,143
$197,863
$201,672
Total liabilities and equity$1,889,133
$1,792,077
$1,925,165
$1,842,465

The following table presents certain liabilities of consolidated VIEs, which are included in the Consolidated Balance Sheet above. The liabilities in the table below include third-party liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. The liabilities also exclude amounts where creditors or beneficial interest holders have recourse to the general credit of Citigroup.
September 30, September 30, 
2017December 31,2018December 31,
In millions of dollars(Unaudited)2016(Unaudited)2017
Liabilities of consolidated VIEs for which creditors or beneficial interest holders
do not have recourse to the general credit of Citigroup
 
 
 
 
Short-term borrowings$10,166
$10,697
$12,307
$10,142
Long-term debt28,666
23,919
27,625
30,492
Other liabilities396
1,275
748
611
Total liabilities of consolidated VIEs for which creditors or beneficial interest
holders do not have recourse to the general credit of Citigroup
$39,228
$35,891
$40,680
$41,245
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY Citigroup Inc. and Subsidiaries
(UNAUDITED)  
Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars, except shares in thousands20172016
In millions of dollars2018201720182017
Preferred stock at aggregate liquidation value 
 
  
 
Balance, beginning of period$19,253
$16,718
$19,035
$19,253
$19,253
$19,253
Issuance of new preferred stock—
2,535
Redemption of preferred stock—
—
(218)—
Balance, end of period$19,253
$19,253
$19,035
$19,253
$19,035
$19,253
Common stock and additional paid-in capital 
 
  
 
Balance, beginning of period$108,073
$108,319
$107,755
$107,829
$108,039
$108,073
Employee benefit plans(137)(371)98
102
(187)(137)
Preferred stock issuance expense—
(37)
Other(9)(5)3
(4)4
(9)
Balance, end of period$107,927
$107,906
$107,856
$107,927
$107,856
$107,927
Retained earnings 
 
  
 
Balance, beginning of period$146,477
$133,841
$145,211
$152,178
$138,425
$146,477
Adjustment to opening balance, net of taxes(1)
(660)15
—
—
(84)(660)
Adjusted balance, beginning of period$145,817
$133,856
$145,211
$152,178
$138,341
$145,817
Citigroup’s net income12,095
11,339
4,622
4,133
13,732
12,095
Common dividends(2)
(1,755)(760)(1,127)(865)(2,777)(1,755)
Preferred dividends(893)(757)(270)(272)(860)(893)
Other(3)
(90)—
—
—
—
(90)
Balance, end of period$155,174
$143,678
$148,436
$155,174
$148,436
$155,174
Treasury stock, at cost 
 
  
 
Balance, beginning of period$(16,302)$(7,677)$(34,413)$(19,342)$(30,309)$(16,302)
Employee benefit plans(4)
526
775
6
3
477
526
Treasury stock acquired(5)
(9,053)(5,167)(5,271)(5,490)(9,846)(9,053)
Balance, end of period$(24,829)$(12,069)$(39,678)$(24,829)$(39,678)$(24,829)
Citigroup’s accumulated other comprehensive income (loss) 
 
  
 
Balance, beginning of period$(32,381)$(29,344)$(37,494)$(29,899)$(34,668)$(32,381)
Adjustment to opening balance, net of taxes(1)
504
(15)—
—
(3)504
Adjusted balance, beginning of period$(31,877)$(29,359)$(37,494)$(29,899)$(34,671)$(31,877)
Citigroup’s total other comprehensive income (loss)1,986
2,166
(1,151)8
(3,974)1,986
Balance, end of period$(29,891)$(27,193)$(38,645)$(29,891)$(38,645)$(29,891)
Total Citigroup common stockholders’ equity$208,381
$212,322
$177,969
$208,381
$177,969
$208,381
Total Citigroup stockholders’ equity$227,634
$231,575
$197,004
$227,634
$197,004
$227,634
Noncontrolling interests 
 
  
 
Balance, beginning of period$1,023
$1,235
$874
$1,088
$932
$1,023
Transactions between noncontrolling-interest shareholders and the related consolidated subsidiary(3)(11)—
(3)—
(3)
Transactions between Citigroup and the noncontrolling-interest shareholders(50)(69)(23)(56)(39)(50)
Net income attributable to noncontrolling-interest shareholders41
48
3
—
51
41
Dividends paid to noncontrolling-interest shareholders(44)(42)
Distributions paid to noncontrolling-interest shareholders(2)(44)(38)(44)
Other comprehensive income (loss) attributable to noncontrolling-interest shareholders
82
(13)8
12
(35)82
Other(61)(33)(1)(9)(12)(61)
Net change in noncontrolling interests$(35)$(120)$(15)$(100)$(73)$(35)
Balance, end of period$988
$1,115
$859
$988
$859
$988
Total equity$228,622
$232,690
$197,863
$228,622
$197,863
$228,622

(1)See Note 1 to the Consolidated Financial Statements for additional details.
(2)Common dividends declared were $0.32 per share in the first and second quarters and $0.45 per share in the third quarter of 2018. Common dividends declared were $0.16 per share in the first and second quarters and $0.32 per share infor the third quarter of 2017. Common dividends declared were $0.05 per share in the first and second quarters and $0.16 per share in the third quarter of 2016.
(3)
Includes the impact of ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. See Note 1 to the Consolidated Financial Statements.


(4)Includes treasury stock related to (i) certain activity on employee stock option program exercises where the employee delivers existing shares to cover the option exercise, or (ii) under Citi’s employee restricted or deferred stock programs where shares are withheld to satisfy tax requirements.


(5) For the nine months ended September 30, 2017 and 2016, primarily consists of open market purchases under Citi’s Board of Directors-approved common stock repurchase program.
(5)For the three and nine months ended September 30, 2018 and 2017, primarily consists of open market purchases under Citi’s Board of Directors-approved common stock repurchase program.

The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


CONSOLIDATED STATEMENT OF CASH FLOWS Citigroup Inc. and Subsidiaries
(UNAUDITED)  
Nine Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620182017
Cash flows from operating activities of continuing operations 
 
 
 
Net income before attribution of noncontrolling interests$12,136
$11,387
$13,783
$12,136
Net income attributable to noncontrolling interests41
48
51
41
Citigroup’s net income$12,095
$11,339
$13,732
$12,095
Loss from discontinued operations, net of taxes(2)(55)—
(2)
Income from continuing operations—excluding noncontrolling interests$12,097
$11,394
$13,732
$12,097
Adjustments to reconcile net income to net cash provided by operating activities of continuing operations 
 
 
 
Net gains on significant disposals(1)
(602)(422)(247)(602)
Depreciation and amortization2,717
2,714
2,800
2,717
Provision for loan losses5,487
5,022
5,504
5,487
Realized gains from sales of investments(626)(673)(341)(626)
Net impairment losses on investments, goodwill and intangible assets75
616
113
75
Change in trading account assets(15,077)(13,396)(4,831)(14,383)
Change in trading account liabilities(225)14,137
22,482
(1,015)
Change in brokerage receivables net of brokerage payables(3,136)(230)9,709
(3,136)
Change in loans held-for-sale (HFS)1,969
3,958
Change in loans HFS1,380
1,969
Change in other assets(4,501)(2,009)(8,696)(5,351)
Change in other liabilities779
1,398
(848)1,569
Other, net(2,262)5,825
(10,691)(2,262)
Total adjustments$(15,402)$16,940
$16,334
$(15,558)
Net cash provided by (used in) operating activities of continuing operations$(3,305)$28,334
$30,066
$(3,461)
Cash flows from investing activities of continuing operations 
 
 
 
Change in deposits with banks$(26,054)$(20,374)
Change in federal funds sold and securities borrowed or purchased under agreements to resell(15,795)(16,370)$(48,462)$(15,795)
Change in loans(41,569)(42,163)(16,131)(41,569)
Proceeds from sales and securitizations of loans7,019
12,676
4,021
7,019
Purchases of investments(151,362)(155,804)(129,054)(151,362)
Proceeds from sales of investments89,724
99,172
52,170
89,724
Proceeds from maturities of investments67,166
52,607
82,940
67,166
Proceeds from significant disposals(1)
3,411
265
314
3,411
Capital expenditures on premises and equipment and capitalized software(2,502)(2,092)(2,682)(2,502)
Proceeds from sales of premises and equipment, subsidiaries and affiliates,
and repossessed assets
292
467
Proceeds from sales of premises and equipment, subsidiaries and affiliates
and repossessed assets
174
292
Other, net147
156
Net cash used in investing activities of continuing operations$(69,670)$(71,616)$(56,563)$(43,460)
Cash flows from financing activities of continuing operations 
 
 
 
Dividends paid$(2,639)$(1,517)$(3,616)$(2,639)
Issuance of preferred stock—
2,498
Redemption of preferred stock(218)—
Treasury stock acquired(9,071)(5,167)(9,848)(9,071)
Stock tendered for payment of withholding taxes(402)(313)(479)(402)
Change in federal funds purchased and securities loaned or sold under agreements to repurchase19,461
6,628
19,638
19,461
Issuance of long-term debt52,293
43,464
53,027
52,293
Payments and redemptions of long-term debt(29,785)(40,461)(47,201)(29,785)
Change in deposits34,632
32,365
45,354
34,632
Change in short-term borrowings7,448
8,448
(10,681)7,448


CONSOLIDATED STATEMENT OF CASH FLOWSCitigroup Inc. and Subsidiaries  
(UNAUDITED) (Continued)Nine Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620182017
Net cash provided by financing activities of continuing operations$71,937
$45,945
$45,976
$71,937
Effect of exchange rate changes on cash and cash equivalents$599
$(144)
Change in cash and due from banks$(439)$2,519
Cash and due from banks at beginning of period23,043
20,900
Cash and due from banks at end of period$22,604
$23,419
Effect of exchange rate changes on cash and due from banks$(709)$599
Change in cash and due from banks and deposits with banks(2)
$18,770
$25,615
Cash, due from banks and deposits with banks at beginning of period(2)
180,516
160,494
Cash, due from banks and deposits with banks at end of period(2)
$199,286
$186,109
Cash and due from banks$25,727
$22,604
Deposits with banks173,559
163,505
Cash, due from banks and deposits with banks at end of period$199,286
$186,109
Supplemental disclosure of cash flow information for continuing operations 
 
 
 
Cash paid during the period for income taxes$2,714
$2,855
$3,261
$2,714
Cash paid during the period for interest11,604
9,760
16,278
11,604
Non-cash investing activities 
 
 
 
Transfers to loans HFS from loans$3,800
$8,600
$3,300
$3,800
Transfers to OREO and other repossessed assets85
138
94
85

(1)    See Note 2 to the Consolidated Financial Statements for further information on significant disposals.
(2)    Includes the impact of ASU 2016-18, Restricted Cash. See Notes 1 and 22 to the Consolidated Financial Statements.
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.




NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION AND ACCOUNTING CHANGES

Basis of Presentation
The accompanying unaudited Consolidated Financial Statements as of September 30, 2017 and for the three- and nine-month periods ended September 30, 2017 and 2016 include the accounts of Citigroup Inc. and its consolidated subsidiaries.
In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation have been reflected. The accompanying unaudited Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and related notes included in Citigroup’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, including the historical audited consolidated financial statements of Citigroup reflecting the certain realignments and reclassifications set forth in Citigroup’s Current Report on Form 8-K filed with the SEC on June 16, 2017 (2016 Annual Report on Form 10-K), and Citigroup’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 (First Quarter of 2017 Form 10-Q) and June 30, 2017 (Second Quarter of 2017 Form 10-Q).
Certain financial information that is normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), but is not required for interim reporting purposes, has been condensed or omitted.
Management must make estimates and assumptions that affect the Consolidated Financial Statements and the related footnote disclosures. While management uses its best judgment, actual results could differ from those estimates.
As noted above, the Notes to Consolidated Financial Statements are unaudited.
Throughout these Notes, “Citigroup,” “Citi” and the “Company” refer to Citigroup Inc. and its consolidated subsidiaries.
Certain reclassifications have been made to the prior periods’ financial statements and notes to conform to the current period’s presentation.

ACCOUNTING CHANGES

Premium Amortization on Purchased Callable Debt SecuritiesLease Accounting
In March 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities, which amends the amortization period for certain purchased callable debt securities held at a premium.  The ASU requires entities to amortize premiums on debt securities by the first call date when the securities have fixed and determinable call dates and prices. The scope of the ASU includes all accounting premiums, such as purchase premiums and cumulative fair value hedge
adjustments.  The ASU does not change the accounting for discounts, which continue to be recognized over the contractual life of a security.
For calendar-year-end entities, the ASU is effective as of January 1, 2019, but it may be early adopted in any interim or year-end period after issuance. Adoption of the ASU is on a modified retrospective basis through a cumulative effect adjustment to retained earnings as of the beginning of the year of adoption. Citi has early adopted the ASU in the second quarter of 2017, with an effective date of January 1, 2017.  Adoption of the ASU primarily affected Citi’s available-for-sale (AFS) and held-to-maturity (HTM) portfolios of callable state and municipal securities. The ASU adoption resulted in a net reduction to total stockholders’ equity of $156 million (after tax), effective as of January 1, 2017.  This amount is composed of a reduction of approximately $660 million to retained earnings for the incremental amortization of purchase premiums and cumulative hedge adjustments generated under fair value hedges of these callable debt securities. This amount was partially offset by an increase to Accumulated other comprehensive income (loss) (AOCI) of $504 million related to the cumulative fair value hedge adjustments reclassified to retained earnings for AFS securities.
Financial statements for periods prior to 2017 were not subject to restatement under the provisions of this ASU.  The amortization recorded in the third quarter and for the first nine months of 2017 under the provisions of the ASU is not materially different than the amounts that would have been recorded if the ASU had not been early adopted.

Recognition and Measurement of Financial Assets and Financial Liabilities
In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments.
This ASU requires entities to present separately in AOCI the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. It also requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, thus eliminating eligibility for the current available-for-sale category. However, Federal Reserve Bank and Federal Home Loan Bank stock as well as certain exchange seats will continue to be presented at cost.
Citi early adopted only the provisions of this ASU related to presentation of the change in fair value of liabilities for which the fair value option was elected, related to changes in Citigroup’s own credit spreads in AOCI


effective January 1, 2016. Accordingly, as of the first quarter of 2016, these amounts are reflected as a component of AOCI, whereas these amounts were previously recognized in Citigroup’s revenues and net income. The impact of adopting this amendment resulted in a cumulative catch-up reclassification from retained earnings to AOCI of an accumulated after-tax loss of approximately $15 million at January 1, 2016. Financial statements for periods prior to 2016 were not subject to restatement under the provisions of this ASU. For additional information, see Note 17, Note 20and Note 21 to the Consolidated Financial Statements. The Company is evaluating the effects that the other provisions of ASU 2016-01, which are effective January 1, 2018, will have on its Consolidated Financial Statements and related disclosures.

FUTURE APPLICATION OF ACCOUNTING STANDARDS

Accounting for Financial Instruments—Credit Losses
In JuneFebruary 2016, the FASB issued ASU No. 2016-13,2016-02, Financial Instruments—Credit Losses(Topic 326).Leases (Topic 842), which is intended to increase transparency and comparability of accounting for lease transactions. The ASU introduceswill require lessees to recognize leases on the balance sheet as lease assets and lease liabilities and will require both quantitative and qualitative disclosures regarding key information about leasing arrangements. Lessor accounting is largely unchanged. The guidance is effective beginning January 1, 2019 and will be adopted prospectively with a new credit loss model,cumulative adjustment to Retained earnings. The Company estimates that upon adoption, its Consolidated Balance Sheet
will have an approximate $5 billion increase in assets and liabilities. Additionally, the Current Expected Credit Losses model (CECL), which requires earlier recognitionCompany estimates an approximate $140 million increase in retained earnings due to the cumulative effect of credit losses, while also providing additional transparency about credit risk.recognizing previously deferred gains on sale/leaseback transactions.

Subsequent Measurement of Goodwill
In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The CECL model utilizes a lifetime “expected credit loss”ASU simplifies the subsequent measurement objective forof goodwill impairment by eliminating the recognition of credit losses for loans, held-to-maturity securities and other receivables atrequirement to calculate the time the financial asset is originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses. For available-for-sale securities whereimplied fair value is less than cost, credit-related impairment, if any, will be recognized in an allowance for credit losses and adjusted each period for changes in expected credit risk. This model replacesof goodwill (i.e., the multiple existing impairment models in current GAAP, which generally require that a loss be incurred before it is recognized.
The CECL model represents a significant change from existing GAAP and may result in material changes to the Company’s accounting for financial instruments. The Company is evaluating the effect that ASU 2016-13 will have on its Consolidated Financial Statements and related disclosures. The impactStep 2 of the goodwill impairment test) to measure a goodwill impairment charge. Under the ASU, will depend upon the stateimpairment test is the comparison of the economy andfair value of a reporting unit with its carrying amount (the current Step 1), with the natureimpairment charge being the deficit in fair value but not exceeding the total amount of Citi’s portfolios at the date of adoption. Based on a preliminary analysis performed earlier in 2017 and the environment atgoodwill allocated to that time, the overall impact is estimatedreporting unit. The simplified one-step impairment test applies to be an approximate 10-20% increase in credit reserves. Moreover, there are still some implementation questions that will need to be resolved that could affect the estimated impact. all reporting units (including those with zero or negative carrying amounts).
The ASU will be effective for Citi as of January 1, 2020. Early application is permitted for annual periods beginning January 1, 2019.The impact of the ASU will depend upon the performance of Citi’s reporting units and the market conditions impacting the fair value of each reporting unit going forward.

Revenue RecognitionFair Value Measurement
In May 2014,August 2018, the FASB issued ASU No. 2014-09,2018-13, RevenueFair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The amendments modify certain disclosure requirements for fair value measurements and are effective January 1, 2020, with early adoption permitted. Adoption of this standard is not expected to have a material impact on the Company.

See Note 1 to the Consolidated Financial Statements for a discussion of “Accounting Changes.”



DISCLOSURE CONTROLS AND PROCEDURES
Citi’s disclosure controls and procedures are designed to ensure that information required to be disclosed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, including without limitation that information required to be disclosed by Citi in its SEC filings is accumulated and communicated to management, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate, to allow for timely decisions regarding required disclosure.
Citi’s Disclosure Committee assists the CEO and CFO in their responsibilities to design, establish, maintain and evaluate the effectiveness of Citi’s disclosure controls and procedures. The Disclosure Committee is responsible for, among other things, the oversight, maintenance and implementation of the disclosure controls and procedures, subject to the supervision and oversight of the CEO and CFO.
Citi’s management, with the participation of its CEO and CFO, has evaluated the effectiveness of Citigroup’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of September 30, 2018 and, based on that evaluation, the CEO and CFO have concluded that at that date, Citigroup’s disclosure controls and procedures were effective.

DISCLOSURE PURSUANT TO SECTION 219 OF THE IRAN THREAT REDUCTION AND SYRIA HUMAN RIGHTS ACT

Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, which added Section 13(r) to the Securities Exchange Act of 1934, as amended, Citi is required to disclose in its annual or quarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with individuals or entities that are subject to sanctions under U.S. law. Disclosure is generally required even where the activities, transactions or dealings were conducted in compliance with applicable law. Citi disclosed reportable activities pursuant to Section 219 in the second quarter of 2018 in the Second Quarter of 2018 Form 10-Q.
During the third quarter of 2018, Bank Handlowy w Warszawie S.A., a Citibank subsidiary located in Poland, processed a funds transfer involving the Iranian Embassy in Poland.  The value of  the funds transfer was EUR 100.00 (approximately USD 116.54). In addition, Citibank N.A., India Branch, processed a payment involving the Consulate General of Iran in India. The value of the payment was INR 8,200.00 (approximately USD 111.62). These payments were for visa- and passport-related fees respectively, which are permissible under the travel exemption in the Iranian Transactions and Sanctions Regulations. Citibank realized nominal fees for the processing of these payments. 










FORWARD-LOOKING STATEMENTS

Certain statements in this Form 10-Q, including but not limited to statements included within the Management’s Discussion and Analysis of Financial Condition and Results of Operations, are “forward-looking statements” within the meaning of the rules and regulations of the SEC. In addition, Citigroup also may make forward-looking statements in its other documents filed or furnished with the SEC, and its management may make forward-looking statements orally to analysts, investors, representatives of the media and others.
Generally, forward-looking statements are not based on historical facts but instead represent Citigroup’s and its management’s beliefs regarding future events. Such statements may be identified by words such as believe, expect, anticipate, intend, estimate, may increase, may fluctuate, target, illustrative, and similar expressions or future or conditional verbs such as will, should, would and could.
Such statements are based on management’s current expectations and are subject to risks, uncertainties and changes in circumstances. Actual results and capital and other financial conditions may differ materially from Contractsthose included in these statements due to a variety of factors, including without limitation (i) the precautionary statements included within each individual business’s discussion and analysis of its results of operations above and in Citi’s 2017 Annual Report on Form 10-K, First Quarter of 2018 Form 10-Q and Second Quarter of 2018 Form 10-Q; (ii) the factors listed and described under “Risk Factors” in Citi’s 2017 Annual Report on Form 10-K; and (iii) the risks and uncertainties summarized below:

the potential impact on Citi’s ability to return capital to common shareholders, consistent with Customersits capital optimization efforts and targets, due to, among other things, Citi’s results of operations, Citi’s ability to effectively manage its level of risk weighted assets and GSIB surcharge, potential changes to the regulatory capital framework, the CCAR process and the results of regulatory stress tests or any changes to the stress testing and CCAR requirements or process, such as the proposed introduction of a firm-specific “stress capital buffer” (SCB), which requires an entityincluding as a result of any year-to-year variability resulting from the SCB and the impact on Citi’s estimated management buffer;
the ongoing regulatory and other uncertainties and changes faced by financial institutions, including Citi, in the U.S. and globally, including, uncertainties and potential changes to recognizevarious aspects of the amountregulatory capital framework, and the potential impact these uncertainties and changes could have on Citi’s businesses, results of revenueoperations, financial condition, strategy or organizational structure and compliance risks and costs;
Citi’s ability to utilize its remaining DTAs (including the foreign tax credit component of its DTAs) and thus reduce the negative impact of the DTAs on Citi’s regulatory capital, including as a result of its ability to generate U.S. taxable income and by the provisions of and guidance issued in connection with Tax Reform;
the potential impact to Citi if its interpretation or application of the complex tax laws to which it expectsis subject, such as withholding tax obligations and stamp and other transactional taxes, differs from those of the relevant governmental authorities;
Citi’s ability to beachieve its expected results from ongoing investments in its businesses and efficiency initiatives, including revenue growth, as part of Citi’s operational and financial objectives and targets, including as a result of factors that Citi cannot control;
the potential impact from declining sales and revenues or other difficulties of any retailer or merchant with whom Citi has a co-branding or private label credit card relationship, such as Sears, including as a result of accelerated store closures, termination of a particular relationship, external factors outside the control of either party to the relationship, such as the general economic environment, or other factors, including bankruptcies, liquidations, consolidations and other similar events, and the potential negative impact any such event could have on Citi retail services, including as a result of loss of revenues, higher cost of credit, impairment of purchased credit card relationships and contract-related intangibles or other losses;
the potential impact to Citi’s businesses, including funding costs, level and mix of deposits and other products and net interest revenues, from ongoing increases in interest rates;
the potential impact to Citi’s businesses, credit costs, revenues or other results of operations and financial condition as a result of macroeconomic and geopolitical challenges and uncertainties and volatility, including, among others, potential policy and/or regulatory changes arising from a new administration in Mexico, the implementation of protectionist trade or other related policies by the U.S. and/or other countries, governmental fiscal and monetary actions, or expected actions, such as any balance sheet normalization program implemented by the Federal Reserve Board or other central banks, any agreement, or lack thereof, for the U.K. to withdraw from the European Union, or geopolitical disputes;
the various risks faced by Citi as a result of its presence in the emerging markets, including, among others, sovereign volatility, political events, foreign exchange controls, limitations on foreign investment, sociopolitical instability (including from hyper-inflation), fraud, nationalization or loss of licenses, business restrictions, sanctions or asset freezes, potential criminal charges, closure of branches or subsidiaries and confiscation of assets as well as the increased compliance, regulatory and legal risks and costs;
Citi’s ability in its resolution plan submissions to address any deficiencies identified or future guidance, including any final 2019 resolution plan guidance, provided by the Federal Reserve Board and FDIC;
the potential impact on Citi’s performance, including its competitive position and ability to effectively manage its businesses and continue to execute its strategies, if Citi is


unable to hire and retain highly qualified employees for any reason;
Citi’s ability to effectively compete with U.S. and non-U.S. financial services companies and others;
the potential impact of concentrations of risk, such as credit and market risk arising from the size and volume of Citi’s transactions with counterparties in the public sector, including the U.S. government and its agencies, or in the financial services industry, on Citi’s results of operations;
the potential impacts on Citi’s liquidity and/or costs of funding as a result of external factors, including, among others, market disruptions and governmental fiscal and monetary policies as well as regulatory changes or negative investor perceptions of Citi’s creditworthiness;
the impact of ratings downgrades of Citi or one or more of its more significant subsidiaries or issuing entities on Citi’s funding and liquidity as well as the results of operations of certain of its businesses;
the potential impact to Citi from a disruption of its operational systems, including as a result of, among other things, human error, fraud or malice, accidental technological failure, electrical or telecommunication outages or failure of computer servers, or other similar damage to Citi’s property or assets, or failures by third parties with whom Citi does business, as well as disruptions in the operations of Citi’s clients, customers or other third parties;
the increasing risk of continually evolving, sophisticated cybersecurity risks faced by financial institutions, including Citi and third parties with whom it does business, and others (such as theft of funds or theft, loss, misuse or disclosure of confidential client, customer, corporate or network information or assets and other attempts by unauthorized parties to disrupt computer and network systems), and the potential impact from such risks, including, among others, reputational damage with clients, customers and others, lost revenues, additional costs (including credit, remediation and other costs), regulatory penalties and inquiries, legal exposure and other financial losses;
the potential impact of incorrect assumptions or estimates in Citi’s financial statements or the impact of ongoing changes to financial accounting and reporting standards or interpretations, on how Citi records and reports its financial condition and results of operations;
the potential impact to Citi’s results of operations and/or regulatory capital and capital ratios if Citi’s risk management process, strategies or models, including those related to its ability to manage and aggregate data, are deficient or ineffective, require refinement, modification or enhancement or any approval is withdrawn by Citi’s U.S. banking regulators;
the potential impact to Citi of ongoing implementation and interpretation of regulatory changes and requirements in the U.S. and globally, such as on Citi’s compliance risks and costs, including reputational and legal risks as
 
entitled for well as remediation and other financial costs, such as penalties and fines; and
the transfer of promised goods or services to customers. The Company will adopt the guidance as of January 1, 2018 using a modified retrospective method with a cumulative-effect adjustment to opening retained earnings. While the guidance will replace most existing revenue recognition guidance in GAAP, the ASU is not applicable to financial instruments and, therefore, will not impact a majoritypotential outcomes of the Company’s revenues, includingextensive legal and regulatory proceedings, investigations and other inquiries to which Citi is or may be subject at any given time, particularly given the increased focus on conduct risk and the severity of the remedies sought and potential collateral consequences to Citi arising from such outcomes.

Any forward-looking statements made by or on behalf of Citigroup speak only as to the date they are made, and Citi does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.















































FINANCIAL STATEMENTS AND NOTES TABLE OF CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Statement of Income (Unaudited)—
For the Three and Nine Months Ended September 30, 2018 and 2017
82
Consolidated Statement of Comprehensive Income (Unaudited)—For the Three and Nine Months Ended September 30, 2018 and 2017
83
Consolidated Balance Sheet—September 30, 2018 (Unaudited) and December 31, 2017
84
Consolidated Statement of Changes in Stockholders’ Equity (Unaudited)—For the Three and Nine Months Ended September 30, 2018 and 2017
86
Consolidated Statement of Cash Flows (Unaudited)—
For the Nine Months Ended September 30, 2018 and 2017
88

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Note 1—Basis of Presentation and Accounting Changes
90
Note 2—Discontinued Operations and Significant Disposals
93
Note 3—Business Segments
94
Note 4—Interest Revenue and Expense
95
Note 5—Commissions and Fees; Administration and Other
                 Fiduciary Fees
96
Note 6—Principal Transactions
99
Note 7—Incentive Plans
100
Note 8—Retirement Benefits
100
Note 9—Earnings per Share
105
Note 10—Federal Funds, Securities Borrowed, Loaned and
Subject to Repurchase Agreements
106
Note 11—Brokerage Receivables and Brokerage Payables
109
Note 12—Investments
110


Note 13—Loans
123
Note 14—Allowance for Credit Losses
136
Note 15—Goodwill and Intangible Assets
138
Note 16—Debt
140
Note 17—Changes in Accumulated Other Comprehensive
Income (Loss) (AOCI)
141
Note 18—Securitizations and Variable Interest Entities
147
Note 19—Derivatives Activities
156
Note 20—Fair Value Measurement
167
Note 21—Fair Value Elections
186
Note 22—Guarantees and Commitments
190
Note 23—Contingencies
195
Note 24—Condensed Consolidating Financial Statements
197




CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)Citigroup Inc. and Subsidiaries
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars, except per share amounts2018201720182017
Revenues   
 
Interest revenue$18,170
$15,914
$52,052
$45,729
Interest expense6,368
4,379
17,413
11,981
Net interest revenue$11,802
$11,535
$34,639
$33,748
Commissions and fees$2,803
$3,241
$8,944
$9,552
Principal transactions2,566
2,248
8,006
7,985
Administration and other fiduciary fees911
929
2,750
2,672
Realized gains on sales of investments, net69
213
341
626
Impairment losses on investments   
 
Gross impairment losses(70)(15)(113)(47)
Net impairment losses recognized in earnings$(70)$(15)$(113)$(47)
Other revenue$308
$268
$1,163
$404
Total non-interest revenues$6,587
$6,884
$21,091
$21,192
Total revenues, net of interest expense$18,389
$18,419
$55,730
$54,940
Provisions for credit losses and for benefits and claims   
 
Provision for loan losses$1,906
$2,146
$5,504
$5,487
Policyholder benefits and claims26
28
73
81
Provision (release) for unfunded lending commitments42
(175)66
(190)
Total provisions for credit losses and for benefits and claims$1,974
$1,999
$5,643
$5,378
Operating expenses   
 
Compensation and benefits$5,319
$5,304
$16,578
$16,301
Premises and equipment565
608
1,728
1,832
Technology/communication1,806
1,764
5,361
5,122
Advertising and marketing378
417
1,170
1,222
Other operating2,243
2,324
7,111
7,423
Total operating expenses$10,311
$10,417
$31,948
$31,900
Income from continuing operations before income taxes$6,104
$6,003
$18,139
$17,662
Provision for income taxes1,471
1,866
4,356
5,524
Income from continuing operations$4,633
$4,137
$13,783
$12,138
Discontinued operations   
 
Loss from discontinued operations$(8)$(9)$(17)$(4)
Benefit for income taxes—
(4)(17)(2)
Loss from discontinued operations, net of taxes$(8)$(5)$—
$(2)
Net income before attribution of noncontrolling interests$4,625
$4,132
$13,783
$12,136
Noncontrolling interests3
(1)51
41
Citigroup’s net income$4,622
$4,133
$13,732
$12,095
Basic earnings per share(1)
   
 
Income from continuing operations$1.74
$1.42
$5.04
$4.05
Income from discontinued operations, net of taxes—
—
—
—
Net income$1.73
$1.42
$5.04
$4.05
Weighted average common shares outstanding (in millions)
2,479.8
2,683.6
2,524.1
2,729.3
Diluted earnings per share(1)
   
 
Income from continuing operations$1.74
$1.42
$5.04
$4.05
Income (loss) from discontinued operations, net of taxes—
—
—
—
Net income$1.73
$1.42
$5.04
$4.05
Adjusted weighted average common shares outstanding
  (in millions)
2,481.4
2,683.7
2,525.5
2,729.5
(1)Due to rounding, earnings per share on continuing operations and discontinued operations may not sum to earnings per share on net income.
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.



CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMECitigroup Inc. and Subsidiaries
(UNAUDITED)
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2018201720182017
Citigroup’s net income$4,622
$4,133
$13,732
$12,095
Add: Citigroup's other comprehensive income   
  
Net change in unrealized gains and losses on investment
  securities, net of taxes(1)(2)
$(605)$(66)$(2,161)$127
Net change in debt valuation adjustment (DVA), net of taxes(1)
(287)(123)159
(267)
Net change in cash flow hedges, net of taxes(74)8
(397)123
Benefit plans liability adjustment, net of taxes26
(29)415
(176)
Net change in foreign currency translation adjustment, net of taxes
  and hedges
(221)218
(1,968)2,179
Net change in excluded component of fair value hedges, net of
  taxes

10
—
(22)—
Citigroup’s total other comprehensive income (loss)$(1,151)$8
$(3,974)$1,986
Citigroup’s total comprehensive income$3,471
$4,141
$9,758
$14,081
Add: Other comprehensive income attributable to
  noncontrolling interests
$8
$12
$(35)$82
Add: Net income attributable to noncontrolling interests3
(1)51
41
Total comprehensive income$3,482
$4,152
$9,774
$14,204
(1)See Note 1 to the Consolidated Financial Statements.
(2)For the three and nine months ended September 30, 2018, respectively, amount represents the net change in unrealized gains and losses on available-for-sale (AFS) debt securities. Effective January 1, 2018, the AFS category is eliminated for equity securities under ASU 2016-01.

The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.



CONSOLIDATED BALANCE SHEETCitigroup Inc. and Subsidiaries
 September 30, 
 2018December 31,
In millions of dollars(Unaudited)2017
Assets 
 
Cash and due from banks (including segregated cash and other deposits)$25,727
$23,775
Deposits with banks173,559
156,741
Federal funds sold and securities borrowed and purchased under agreements to resell (including $178,442 and $132,949 as of September 30, 2018 and December 31, 2017, respectively, at fair value)280,941
232,478
Brokerage receivables40,679
38,384
Trading account assets (including $107,753 and $99,460 pledged to creditors at September 30, 2018 and December 31, 2017, respectively)257,502
252,790
Investments:  
  Available-for-sale debt securities (including $7,854 and $9,493 pledged to creditors as of September 30, 2018 and December 31, 2017, respectively)284,782
290,725
Held-to-maturity debt securities (including $1,073 and $435 pledged to creditors as of September 30, 2018 and December 31, 2017, respectively)53,249
53,320
Equity securities (including $1,388 and $1,395 at fair value as of September 30, 2018 and December 31, 2017, respectively, of which $189 was available for sale as of December 31, 2017)7,482
8,245
Total investments$345,513
$352,290
Loans: 
 
Consumer (including $21 and $25 as of September 30, 2018 and December 31, 2017, respectively, at fair value)325,469
333,656
Corporate (including $4,218 and $4,349 as of September 30, 2018 and December 31, 2017, respectively, at fair value)349,440
333,378
Loans, net of unearned income$674,909
$667,034
Allowance for loan losses(12,336)(12,355)
Total loans, net$662,573
$654,679
Goodwill22,187
22,256
Intangible assets (other than MSRs)4,598
4,588
Mortgage servicing rights (MSRs)618
558
Other assets (including $25,151 and $18,559 as of September 30, 2018 and December 31, 2017, respectively, at fair value)111,268
103,926
Total assets$1,925,165
$1,842,465

The following table presents certain assets of consolidated variable interest income. Basedentities (VIEs), which are included in the Consolidated Balance Sheet above. The assets in the table below include those assets that can only be used to settle obligations of consolidated VIEs, presented on the Company’s current interpretationsfollowing page, and are in excess of those obligations. Additionally, the new guidance, the Company does not expect a material changeassets in the timing or measurementtable below include third-party assets of revenuesconsolidated VIEs only and exclude intercompany balances that eliminate in consolidation.
 September 30, 
 2018December 31,
In millions of dollars(Unaudited)2017
Assets of consolidated VIEs to be used to settle obligations of consolidated VIEs 
 
Cash and due from banks$40
$52
Trading account assets722
1,129
Investments2,276
2,498
Loans, net of unearned income 
 
Consumer48,678
54,656
Corporate17,971
19,835
Loans, net of unearned income$66,649
$74,491
Allowance for loan losses(1,876)(1,930)
Total loans, net$64,773
$72,561
Other assets167
154
Total assets of consolidated VIEs to be used to settle obligations of consolidated VIEs$67,978
$76,394
Statement continues on the overall impact to net income is expected to be immaterial.
The new standard clarified the guidance related to reporting revenue gross as a principal versus net as an agent. The Company has identified transactions, including underwriting activity where Citi is deemed the principal, rather than the agent, which require a gross up of annual revenues and expenses of approximately $0.8 billion. This change in presentation will not have an impact on Income from continuing operations;however, this standard would have impacted Citi’s efficiency ratio by approximately 50 basis points for the nine months ended September 30, 2017. The Company continues to evaluate the effect that the guidance will have on other revenue streams within its scope, including the presentation of certain contract costs, as well as changes in disclosures required by the new guidance.next page.


CONSOLIDATED BALANCE SHEETCitigroup Inc. and Subsidiaries
(Continued)
 September 30, 
 2018December 31,
In millions of dollars, except shares and per share amounts(Unaudited)2017
Liabilities 
 
Non-interest-bearing deposits in U.S. offices$111,446
$126,880
Interest-bearing deposits in U.S. offices (including $354 and $303 as of September 30, 2018 and December 31, 2017, respectively, at fair value)351,291
318,613
Non-interest-bearing deposits in offices outside the U.S.83,200
87,440
Interest-bearing deposits in offices outside the U.S. (including $1,086 and $1,162 as of September 30, 2018 and December 31, 2017, respectively, at fair value)459,239
426,889
Total deposits$1,005,176
$959,822
Federal funds purchased and securities loaned and sold under agreements to repurchase (including $48,148 and $40,638 as of September 30, 2018 and December 31, 2017, respectively, at fair value)175,915
156,277
Brokerage payables73,346
61,342
Trading account liabilities147,652
125,170
Short-term borrowings (including $5,041 and $4,627 as of September 30, 2018 and December 31, 2017, respectively, at fair value)33,770
44,452
Long-term debt (including $36,771 and $31,392 as of September 30, 2018 and December 31, 2017, respectively, at fair value)235,270
236,709
Other liabilities (including $19,947 and $13,961 as of September 30, 2018 and December 31, 2017, respectively, at fair value)56,173
57,021
Total liabilities$1,727,302
$1,640,793
Stockholders’ equity 
 
Preferred stock ($1.00 par value; authorized shares: 30 million), issued shares: as of September 30, 2018—761,400 and as of December 31, 2017—770,120, at aggregate liquidation value
$19,035
$19,253
Common stock ($0.01 par value; authorized shares: 6 billion), issued shares: as of September 30, 2018—3,099,567,177 and as of December 31, 2017—3,099,523,273
31
31
Additional paid-in capital107,825
108,008
Retained earnings148,436
138,425
Treasury stock, at cost: September 30, 2018—657,430,364 shares and
  December 31, 2017—529,614,728 shares
(39,678)(30,309)
Accumulated other comprehensive income (loss) (AOCI)(38,645)(34,668)
Total Citigroup stockholders’ equity$197,004
$200,740
Noncontrolling interest859
932
Total equity$197,863
$201,672
Total liabilities and equity$1,925,165
$1,842,465

The following table presents certain liabilities of consolidated VIEs, which are included in the Consolidated Balance Sheet above. The liabilities in the table below include third-party liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. The liabilities also exclude amounts where creditors or beneficial interest holders have recourse to the general credit of Citigroup.
 September 30, 
 2018December 31,
In millions of dollars(Unaudited)2017
Liabilities of consolidated VIEs for which creditors or beneficial interest holders
  do not have recourse to the general credit of Citigroup
 
 
Short-term borrowings$12,307
$10,142
Long-term debt27,625
30,492
Other liabilities748
611
Total liabilities of consolidated VIEs for which creditors or beneficial interest
  holders do not have recourse to the general credit of Citigroup
$40,680
$41,245
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITYCitigroup Inc. and Subsidiaries
(UNAUDITED)
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2018201720182017
Preferred stock at aggregate liquidation value   
 
Balance, beginning of period$19,035
$19,253
$19,253
$19,253
Redemption of preferred stock—
—
(218)—
Balance, end of period$19,035
$19,253
$19,035
$19,253
Common stock and additional paid-in capital   
 
Balance, beginning of period$107,755
$107,829
$108,039
$108,073
Employee benefit plans98
102
(187)(137)
Other3
(4)4
(9)
Balance, end of period$107,856
$107,927
$107,856
$107,927
Retained earnings   
 
Balance, beginning of period$145,211
$152,178
$138,425
$146,477
Adjustment to opening balance, net of taxes(1)
—
—
(84)(660)
Adjusted balance, beginning of period$145,211
$152,178
$138,341
$145,817
Citigroup’s net income4,622
4,133
13,732
12,095
Common dividends(2)
(1,127)(865)(2,777)(1,755)
Preferred dividends(270)(272)(860)(893)
Other(3)
—
—
—
(90)
Balance, end of period$148,436
$155,174
$148,436
$155,174
Treasury stock, at cost   
 
Balance, beginning of period$(34,413)$(19,342)$(30,309)$(16,302)
Employee benefit plans(4)
6
3
477
526
Treasury stock acquired(5)
(5,271)(5,490)(9,846)(9,053)
Balance, end of period$(39,678)$(24,829)$(39,678)$(24,829)
Citigroup’s accumulated other comprehensive income (loss)   
 
Balance, beginning of period$(37,494)$(29,899)$(34,668)$(32,381)
Adjustment to opening balance, net of taxes(1)
—
—
(3)504
Adjusted balance, beginning of period$(37,494)$(29,899)$(34,671)$(31,877)
Citigroup’s total other comprehensive income (loss)(1,151)8
(3,974)1,986
Balance, end of period$(38,645)$(29,891)$(38,645)$(29,891)
Total Citigroup common stockholders’ equity$177,969
$208,381
$177,969
$208,381
Total Citigroup stockholders’ equity$197,004
$227,634
$197,004
$227,634
Noncontrolling interests   
 
Balance, beginning of period$874
$1,088
$932
$1,023
Transactions between noncontrolling-interest shareholders and the related consolidated subsidiary—
(3)—
(3)
Transactions between Citigroup and the noncontrolling-interest shareholders(23)(56)(39)(50)
Net income attributable to noncontrolling-interest shareholders3
—
51
41
Distributions paid to noncontrolling-interest shareholders(2)(44)(38)(44)
Other comprehensive income (loss) attributable to noncontrolling-interest shareholders
8
12
(35)82
Other(1)(9)(12)(61)
Net change in noncontrolling interests$(15)$(100)$(73)$(35)
Balance, end of period$859
$988
$859
$988
Total equity$197,863
$228,622
$197,863
$228,622

(1)See Note 1 to the Consolidated Financial Statements for additional details.
(2)Common dividends declared were $0.32 per share in the first and second quarters and $0.45 per share in the third quarter of 2018. Common dividends declared were $0.16 per share in the first and second quarters and $0.32 for the third quarter of 2017.
(3)
Includes the impact of ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. See Note 1 to the Consolidated Financial Statements.


(4)Includes treasury stock related to (i) certain activity on employee stock option program exercises where the employee delivers existing shares to cover the option exercise, or (ii) under Citi’s employee restricted or deferred stock programs where shares are withheld to satisfy tax requirements.
(5)For the three and nine months ended September 30, 2018 and 2017, primarily consists of open market purchases under Citi’s Board of Directors-approved common stock repurchase program.

The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


CONSOLIDATED STATEMENT OF CASH FLOWSCitigroup Inc. and Subsidiaries
(UNAUDITED)
 Nine Months Ended September 30,
In millions of dollars20182017
Cash flows from operating activities of continuing operations 
 
Net income before attribution of noncontrolling interests$13,783
$12,136
Net income attributable to noncontrolling interests51
41
Citigroup’s net income$13,732
$12,095
Loss from discontinued operations, net of taxes—
(2)
Income from continuing operations—excluding noncontrolling interests$13,732
$12,097
Adjustments to reconcile net income to net cash provided by operating activities of continuing operations 
 
Net gains on significant disposals(1)
(247)(602)
Depreciation and amortization2,800
2,717
Provision for loan losses5,504
5,487
Realized gains from sales of investments(341)(626)
Net impairment losses on investments, goodwill and intangible assets113
75
Change in trading account assets(4,831)(14,383)
Change in trading account liabilities22,482
(1,015)
Change in brokerage receivables net of brokerage payables9,709
(3,136)
Change in loans HFS1,380
1,969
Change in other assets(8,696)(5,351)
Change in other liabilities(848)1,569
Other, net(10,691)(2,262)
Total adjustments$16,334
$(15,558)
Net cash provided by (used in) operating activities of continuing operations$30,066
$(3,461)
Cash flows from investing activities of continuing operations 
 
   Change in federal funds sold and securities borrowed or purchased under agreements to resell$(48,462)$(15,795)
   Change in loans(16,131)(41,569)
   Proceeds from sales and securitizations of loans4,021
7,019
   Purchases of investments(129,054)(151,362)
   Proceeds from sales of investments52,170
89,724
   Proceeds from maturities of investments82,940
67,166
   Proceeds from significant disposals(1)
314
3,411
   Capital expenditures on premises and equipment and capitalized software(2,682)(2,502)
   Proceeds from sales of premises and equipment, subsidiaries and affiliates
      and repossessed assets
174
292
   Other, net147
156
Net cash used in investing activities of continuing operations$(56,563)$(43,460)
Cash flows from financing activities of continuing operations 
 
   Dividends paid$(3,616)$(2,639)
   Redemption of preferred stock(218)—
   Treasury stock acquired(9,848)(9,071)
   Stock tendered for payment of withholding taxes(479)(402)
   Change in federal funds purchased and securities loaned or sold under agreements to repurchase19,638
19,461
   Issuance of long-term debt53,027
52,293
   Payments and redemptions of long-term debt(47,201)(29,785)
   Change in deposits45,354
34,632
   Change in short-term borrowings(10,681)7,448


CONSOLIDATED STATEMENT OF CASH FLOWS 
(UNAUDITED) (Continued)Nine Months Ended September 30,
In millions of dollars20182017
Net cash provided by financing activities of continuing operations$45,976
$71,937
Effect of exchange rate changes on cash and due from banks$(709)$599
Change in cash and due from banks and deposits with banks(2)
$18,770
$25,615
Cash, due from banks and deposits with banks at beginning of period(2)
180,516
160,494
Cash, due from banks and deposits with banks at end of period(2)
$199,286
$186,109
Cash and due from banks$25,727
$22,604
Deposits with banks173,559
163,505
Cash, due from banks and deposits with banks at end of period$199,286
$186,109
Supplemental disclosure of cash flow information for continuing operations 
 
Cash paid during the period for income taxes$3,261
$2,714
Cash paid during the period for interest16,278
11,604
Non-cash investing activities 
 
Transfers to loans HFS from loans$3,300
$3,800
Transfers to OREO and other repossessed assets94
85

(1)    See Note 2 to the Consolidated Financial Statements for further information on significant disposals.
(2)    Includes the impact of ASU 2016-18, Restricted Cash. See Notes 1 and 22 to the Consolidated Financial Statements.
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION AND ACCOUNTING CHANGES

Lease Accounting
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842),which is intended to increase transparency and comparability of accounting for lease transactions. The ASU will require lessees to recognize leases on the balance sheet as lease assets and lease liabilities and will require both quantitative and qualitative disclosures regarding key information about leasing arrangements. Lessor accounting is largely unchanged. The guidance is effective beginning January 1, 2019 and will be adopted prospectively with an optiona cumulative adjustment to early adopt. The Company does not plan to early adopt the ASU.Retained earnings. The Company estimates that upon adoption, its Consolidated Balance Sheet
will have an approximate $5 billion increase in assets and liabilities. Additionally, the Company estimates an approximate $200$140 million increase in retained earnings due to the cumulative effect of recognizing previously deferred gains on sale/leaseback transactions.

Income Tax Impact of Intra-Entity Transfers of Assets
In October 2016, the FASB issued ASU No. 2016-16, Income Taxes—Intra-Entity Transfers of Assets Other Than Inventory, which will require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The ASU is effective January 1, 2018. The Company continues to evaluate the impact of this standard, which is expected to increase DTAs, with an associated decrease in prepaid taxes of approximately $500 million. 



Subsequent Measurement of Goodwill
In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The ASU simplifies the subsequent measurement of goodwill impairment by eliminating the requirement to calculate the implied fair value of goodwill (i.e., the current Step 2 of the goodwill impairment test) to measure a goodwill impairment charge. Under the ASU, the impairment test is simply the comparison of the fair value of a reporting unit with its carrying amount (the current Step 1), with the impairment charge being the deficit in fair value but not exceeding the total amount of goodwill allocated to that reporting unit. The simplified one-step impairment test applies to all reporting units (including those with zero or negative carrying amounts).
The ASU iswill be effective for Citi as of January 1, 2020. Early adoption is permitted for interim and annual goodwill impairment testing dates after January 1, 2017. The impact of the ASU will depend upon the performance of theCiti’s reporting units and the market conditions impacting the fair value of each reporting unit going forward.

Fair Value Measurement
In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The amendments modify certain disclosure requirements for fair value measurements and are effective January 1, 2020, with early adoption permitted. Adoption of this standard is not expected to have a material impact on the Company.

See Note 1 to the Consolidated Financial Statements for a discussion of “Accounting Changes.”



DISCLOSURE CONTROLS AND PROCEDURES
Citi’s disclosure controls and procedures are designed to ensure that information required to be disclosed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, including without limitation that information required to be disclosed by Citi in its SEC filings is accumulated and communicated to management, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate, to allow for timely decisions regarding required disclosure.
Citi’s Disclosure Committee assists the CEO and CFO in their responsibilities to design, establish, maintain and evaluate the effectiveness of Citi’s disclosure controls and procedures. The Disclosure Committee is responsible for, among other things, the oversight, maintenance and implementation of the disclosure controls and procedures, subject to the supervision and oversight of the CEO and CFO.
Citi’s management, with the participation of its CEO and CFO, has evaluated the effectiveness of Citigroup’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of September 30, 2018 and, based on that evaluation, the CEO and CFO have concluded that at that date, Citigroup’s disclosure controls and procedures were effective.

DISCLOSURE PURSUANT TO SECTION 219 OF THE IRAN THREAT REDUCTION AND SYRIA HUMAN RIGHTS ACT

Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, which added Section 13(r) to the Securities Exchange Act of 1934, as amended, Citi is required to disclose in its annual or quarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with individuals or entities that are subject to sanctions under U.S. law. Disclosure is generally required even where the activities, transactions or dealings were conducted in compliance with applicable law. Citi disclosed reportable activities pursuant to Section 219 in the second quarter of 2018 in the Second Quarter of 2018 Form 10-Q.
During the third quarter of 2018, Bank Handlowy w Warszawie S.A., a Citibank subsidiary located in Poland, processed a funds transfer involving the Iranian Embassy in Poland.  The value of  the funds transfer was EUR 100.00 (approximately USD 116.54). In addition, Citibank N.A., India Branch, processed a payment involving the Consulate General of Iran in India. The value of the payment was INR 8,200.00 (approximately USD 111.62). These payments were for visa- and passport-related fees respectively, which are permissible under the travel exemption in the Iranian Transactions and Sanctions Regulations. Citibank realized nominal fees for the processing of these payments. 










FORWARD-LOOKING STATEMENTS

Certain statements in this Form 10-Q, including but not limited to statements included within the Management’s Discussion and Analysis of Financial Condition and Results of Operations, are “forward-looking statements” within the meaning of the rules and regulations of the SEC. In addition, Citigroup also may make forward-looking statements in its other documents filed or furnished with the SEC, and its management may make forward-looking statements orally to analysts, investors, representatives of the media and others.
Generally, forward-looking statements are not based on historical facts but instead represent Citigroup’s and its management’s beliefs regarding future events. Such statements may be identified by words such as believe, expect, anticipate, intend, estimate, may increase, may fluctuate, target, illustrative, and similar expressions or future or conditional verbs such as will, should, would and could.
Such statements are based on management’s current expectations and are subject to risks, uncertainties and changes in circumstances. Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors, including without limitation (i) the precautionary statements included within each individual business’s discussion and analysis of its results of operations above and in Citi’s 2017 Annual Report on Form 10-K, First Quarter of 2018 Form 10-Q and Second Quarter of 2018 Form 10-Q; (ii) the factors listed and described under “Risk Factors” in Citi’s 2017 Annual Report on Form 10-K; and (iii) the risks and uncertainties summarized below:

the potential impact on Citi’s ability to return capital to common shareholders, consistent with its capital optimization efforts and targets, due to, among other things, Citi’s results of operations, Citi’s ability to effectively manage its level of risk weighted assets and GSIB surcharge, potential changes to the regulatory capital framework, the CCAR process and the results of regulatory stress tests or any changes to the stress testing and CCAR requirements or process, such as the proposed introduction of a firm-specific “stress capital buffer” (SCB), including as a result of any year-to-year variability resulting from the SCB and the impact on Citi’s estimated management buffer;
the ongoing regulatory and other uncertainties and changes faced by financial institutions, including Citi, in the U.S. and globally, including, uncertainties and potential changes to various aspects of the regulatory capital framework, and the potential impact these uncertainties and changes could have on Citi’s businesses, results of operations, financial condition, strategy or organizational structure and compliance risks and costs;
Citi’s ability to utilize its remaining DTAs (including the foreign tax credit component of its DTAs) and thus reduce the negative impact of the DTAs on Citi’s regulatory capital, including as a result of its ability to generate U.S. taxable income and by the provisions of and guidance issued in connection with Tax Reform;
the potential impact to Citi if its interpretation or application of the complex tax laws to which it is subject, such as withholding tax obligations and stamp and other transactional taxes, differs from those of the relevant governmental authorities;
Citi’s ability to achieve its expected results from ongoing investments in its businesses and efficiency initiatives, including revenue growth, as part of Citi’s operational and financial objectives and targets, including as a result of factors that Citi cannot control;
the potential impact from declining sales and revenues or other difficulties of any retailer or merchant with whom Citi has a co-branding or private label credit card relationship, such as Sears, including as a result of accelerated store closures, termination of a particular relationship, external factors outside the control of either party to the relationship, such as the general economic environment, or other factors, including bankruptcies, liquidations, consolidations and other similar events, and the potential negative impact any such event could have on Citi retail services, including as a result of loss of revenues, higher cost of credit, impairment of purchased credit card relationships and contract-related intangibles or other losses;
the potential impact to Citi’s businesses, including funding costs, level and mix of deposits and other products and net interest revenues, from ongoing increases in interest rates;
the potential impact to Citi’s businesses, credit costs, revenues or other results of operations and financial condition as a result of macroeconomic and geopolitical challenges and uncertainties and volatility, including, among others, potential policy and/or regulatory changes arising from a new administration in Mexico, the implementation of protectionist trade or other related policies by the U.S. and/or other countries, governmental fiscal and monetary actions, or expected actions, such as any balance sheet normalization program implemented by the Federal Reserve Board or other central banks, any agreement, or lack thereof, for the U.K. to withdraw from the European Union, or geopolitical disputes;
the various risks faced by Citi as a result of its presence in the emerging markets, including, among others, sovereign volatility, political events, foreign exchange controls, limitations on foreign investment, sociopolitical instability (including from hyper-inflation), fraud, nationalization or loss of licenses, business restrictions, sanctions or asset freezes, potential criminal charges, closure of branches or subsidiaries and confiscation of assets as well as the increased compliance, regulatory and legal risks and costs;
Citi’s ability in its resolution plan submissions to address any deficiencies identified or future guidance, including any final 2019 resolution plan guidance, provided by the Federal Reserve Board and FDIC;
the potential impact on Citi’s performance, including its competitive position and ability to effectively manage its businesses and continue to execute its strategies, if Citi is


unable to hire and retain highly qualified employees for any reason;
Citi’s ability to effectively compete with U.S. and non-U.S. financial services companies and others;
the potential impact of concentrations of risk, such as credit and market risk arising from the size and volume of Citi’s transactions with counterparties in the public sector, including the U.S. government and its agencies, or in the financial services industry, on Citi’s results of operations;
the potential impacts on Citi’s liquidity and/or costs of funding as a result of external factors, including, among others, market disruptions and governmental fiscal and monetary policies as well as regulatory changes or negative investor perceptions of Citi’s creditworthiness;
the impact of ratings downgrades of Citi or one or more of its more significant subsidiaries or issuing entities on Citi’s funding and liquidity as well as the results of operations of certain of its businesses;
the potential impact to Citi from a disruption of its operational systems, including as a result of, among other things, human error, fraud or malice, accidental technological failure, electrical or telecommunication outages or failure of computer servers, or other similar damage to Citi’s property or assets, or failures by third parties with whom Citi does business, as well as disruptions in the operations of Citi’s clients, customers or other third parties;
the increasing risk of continually evolving, sophisticated cybersecurity risks faced by financial institutions, including Citi and third parties with whom it does business, and others (such as theft of funds or theft, loss, misuse or disclosure of confidential client, customer, corporate or network information or assets and other attempts by unauthorized parties to disrupt computer and network systems), and the potential impact from such risks, including, among others, reputational damage with clients, customers and others, lost revenues, additional costs (including credit, remediation and other costs), regulatory penalties and inquiries, legal exposure and other financial losses;
the potential impact of incorrect assumptions or estimates in Citi’s financial statements or the impact of ongoing changes to financial accounting and reporting standards or interpretations, on how Citi records and reports its financial condition and results of operations;
the potential impact to Citi’s results of operations and/or regulatory capital and capital ratios if Citi’s risk management process, strategies or models, including those related to its ability to manage and aggregate data, are deficient or ineffective, require refinement, modification or enhancement or any approval is withdrawn by Citi’s U.S. banking regulators;
the potential impact to Citi of ongoing implementation and interpretation of regulatory changes and requirements in the U.S. and globally, such as on Citi’s compliance risks and costs, including reputational and legal risks as
well as remediation and other financial costs, such as penalties and fines; and
the potential outcomes of the extensive legal and regulatory proceedings, investigations and other inquiries to which Citi is or may be subject at any given time, particularly given the increased focus on conduct risk and the severity of the remedies sought and potential collateral consequences to Citi arising from such outcomes.

Any forward-looking statements made by or on behalf of Citigroup speak only as to the date they are made, and Citi does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.















































FINANCIAL STATEMENTS AND NOTES TABLE OF CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Statement of Income (Unaudited)—
For the Three and Nine Months Ended September 30, 2018 and 2017
82
Consolidated Statement of Comprehensive Income (Unaudited)—For the Three and Nine Months Ended September 30, 2018 and 2017
83
Consolidated Balance Sheet—September 30, 2018 (Unaudited) and December 31, 2017
84
Consolidated Statement of Changes in Stockholders’ Equity (Unaudited)—For the Three and Nine Months Ended September 30, 2018 and 2017
86
Consolidated Statement of Cash Flows (Unaudited)—
For the Nine Months Ended September 30, 2018 and 2017
88

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Note 1—Basis of Presentation and Accounting Changes
90
Note 2—Discontinued Operations and Significant Disposals
93
Note 3—Business Segments
94
Note 4—Interest Revenue and Expense
95
Note 5—Commissions and Fees; Administration and Other
                 Fiduciary Fees
96
Note 6—Principal Transactions
99
Note 7—Incentive Plans
100
Note 8—Retirement Benefits
100
Note 9—Earnings per Share
105
Note 10—Federal Funds, Securities Borrowed, Loaned and
Subject to Repurchase Agreements
106
Note 11—Brokerage Receivables and Brokerage Payables
109
Note 12—Investments
110


Note 13—Loans
123
Note 14—Allowance for Credit Losses
136
Note 15—Goodwill and Intangible Assets
138
Note 16—Debt
140
Note 17—Changes in Accumulated Other Comprehensive
Income (Loss) (AOCI)
141
Note 18—Securitizations and Variable Interest Entities
147
Note 19—Derivatives Activities
156
Note 20—Fair Value Measurement
167
Note 21—Fair Value Elections
186
Note 22—Guarantees and Commitments
190
Note 23—Contingencies
195
Note 24—Condensed Consolidating Financial Statements
197




CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)Citigroup Inc. and Subsidiaries
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars, except per share amounts2018201720182017
Revenues   
 
Interest revenue$18,170
$15,914
$52,052
$45,729
Interest expense6,368
4,379
17,413
11,981
Net interest revenue$11,802
$11,535
$34,639
$33,748
Commissions and fees$2,803
$3,241
$8,944
$9,552
Principal transactions2,566
2,248
8,006
7,985
Administration and other fiduciary fees911
929
2,750
2,672
Realized gains on sales of investments, net69
213
341
626
Impairment losses on investments   
 
Gross impairment losses(70)(15)(113)(47)
Net impairment losses recognized in earnings$(70)$(15)$(113)$(47)
Other revenue$308
$268
$1,163
$404
Total non-interest revenues$6,587
$6,884
$21,091
$21,192
Total revenues, net of interest expense$18,389
$18,419
$55,730
$54,940
Provisions for credit losses and for benefits and claims   
 
Provision for loan losses$1,906
$2,146
$5,504
$5,487
Policyholder benefits and claims26
28
73
81
Provision (release) for unfunded lending commitments42
(175)66
(190)
Total provisions for credit losses and for benefits and claims$1,974
$1,999
$5,643
$5,378
Operating expenses   
 
Compensation and benefits$5,319
$5,304
$16,578
$16,301
Premises and equipment565
608
1,728
1,832
Technology/communication1,806
1,764
5,361
5,122
Advertising and marketing378
417
1,170
1,222
Other operating2,243
2,324
7,111
7,423
Total operating expenses$10,311
$10,417
$31,948
$31,900
Income from continuing operations before income taxes$6,104
$6,003
$18,139
$17,662
Provision for income taxes1,471
1,866
4,356
5,524
Income from continuing operations$4,633
$4,137
$13,783
$12,138
Discontinued operations   
 
Loss from discontinued operations$(8)$(9)$(17)$(4)
Benefit for income taxes—
(4)(17)(2)
Loss from discontinued operations, net of taxes$(8)$(5)$—
$(2)
Net income before attribution of noncontrolling interests$4,625
$4,132
$13,783
$12,136
Noncontrolling interests3
(1)51
41
Citigroup’s net income$4,622
$4,133
$13,732
$12,095
Basic earnings per share(1)
   
 
Income from continuing operations$1.74
$1.42
$5.04
$4.05
Income from discontinued operations, net of taxes—
—
—
—
Net income$1.73
$1.42
$5.04
$4.05
Weighted average common shares outstanding (in millions)
2,479.8
2,683.6
2,524.1
2,729.3
Diluted earnings per share(1)
   
 
Income from continuing operations$1.74
$1.42
$5.04
$4.05
Income (loss) from discontinued operations, net of taxes—
—
—
—
Net income$1.73
$1.42
$5.04
$4.05
Adjusted weighted average common shares outstanding
  (in millions)
2,481.4
2,683.7
2,525.5
2,729.5
(1)Due to rounding, earnings per share on continuing operations and discontinued operations may not sum to earnings per share on net income.
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.



CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMECitigroup Inc. and Subsidiaries
(UNAUDITED)
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2018201720182017
Citigroup’s net income$4,622
$4,133
$13,732
$12,095
Add: Citigroup's other comprehensive income   
  
Net change in unrealized gains and losses on investment
  securities, net of taxes(1)(2)
$(605)$(66)$(2,161)$127
Net change in debt valuation adjustment (DVA), net of taxes(1)
(287)(123)159
(267)
Net change in cash flow hedges, net of taxes(74)8
(397)123
Benefit plans liability adjustment, net of taxes26
(29)415
(176)
Net change in foreign currency translation adjustment, net of taxes
  and hedges
(221)218
(1,968)2,179
Net change in excluded component of fair value hedges, net of
  taxes

10
—
(22)—
Citigroup’s total other comprehensive income (loss)$(1,151)$8
$(3,974)$1,986
Citigroup’s total comprehensive income$3,471
$4,141
$9,758
$14,081
Add: Other comprehensive income attributable to
  noncontrolling interests
$8
$12
$(35)$82
Add: Net income attributable to noncontrolling interests3
(1)51
41
Total comprehensive income$3,482
$4,152
$9,774
$14,204
(1)See Note 1 to the Consolidated Financial Statements.
(2)For the three and nine months ended September 30, 2018, respectively, amount represents the net change in unrealized gains and losses on available-for-sale (AFS) debt securities. Effective January 1, 2018, the AFS category is eliminated for equity securities under ASU 2016-01.

The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.



CONSOLIDATED BALANCE SHEETCitigroup Inc. and Subsidiaries
 September 30, 
 2018December 31,
In millions of dollars(Unaudited)2017
Assets 
 
Cash and due from banks (including segregated cash and other deposits)$25,727
$23,775
Deposits with banks173,559
156,741
Federal funds sold and securities borrowed and purchased under agreements to resell (including $178,442 and $132,949 as of September 30, 2018 and December 31, 2017, respectively, at fair value)280,941
232,478
Brokerage receivables40,679
38,384
Trading account assets (including $107,753 and $99,460 pledged to creditors at September 30, 2018 and December 31, 2017, respectively)257,502
252,790
Investments:  
  Available-for-sale debt securities (including $7,854 and $9,493 pledged to creditors as of September 30, 2018 and December 31, 2017, respectively)284,782
290,725
Held-to-maturity debt securities (including $1,073 and $435 pledged to creditors as of September 30, 2018 and December 31, 2017, respectively)53,249
53,320
Equity securities (including $1,388 and $1,395 at fair value as of September 30, 2018 and December 31, 2017, respectively, of which $189 was available for sale as of December 31, 2017)7,482
8,245
Total investments$345,513
$352,290
Loans: 
 
Consumer (including $21 and $25 as of September 30, 2018 and December 31, 2017, respectively, at fair value)325,469
333,656
Corporate (including $4,218 and $4,349 as of September 30, 2018 and December 31, 2017, respectively, at fair value)349,440
333,378
Loans, net of unearned income$674,909
$667,034
Allowance for loan losses(12,336)(12,355)
Total loans, net$662,573
$654,679
Goodwill22,187
22,256
Intangible assets (other than MSRs)4,598
4,588
Mortgage servicing rights (MSRs)618
558
Other assets (including $25,151 and $18,559 as of September 30, 2018 and December 31, 2017, respectively, at fair value)111,268
103,926
Total assets$1,925,165
$1,842,465

The following table presents certain assets of consolidated variable interest entities (VIEs), which are included in the Consolidated Balance Sheet above. The assets in the table below include those assets that can only be used to settle obligations of consolidated VIEs, presented on the following page, and are in excess of those obligations. Additionally, the assets in the table below include third-party assets of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation.
 September 30, 
 2018December 31,
In millions of dollars(Unaudited)2017
Assets of consolidated VIEs to be used to settle obligations of consolidated VIEs 
 
Cash and due from banks$40
$52
Trading account assets722
1,129
Investments2,276
2,498
Loans, net of unearned income 
 
Consumer48,678
54,656
Corporate17,971
19,835
Loans, net of unearned income$66,649
$74,491
Allowance for loan losses(1,876)(1,930)
Total loans, net$64,773
$72,561
Other assets167
154
Total assets of consolidated VIEs to be used to settle obligations of consolidated VIEs$67,978
$76,394
Statement continues on the next page.


CONSOLIDATED BALANCE SHEETCitigroup Inc. and Subsidiaries
(Continued)
 September 30, 
 2018December 31,
In millions of dollars, except shares and per share amounts(Unaudited)2017
Liabilities 
 
Non-interest-bearing deposits in U.S. offices$111,446
$126,880
Interest-bearing deposits in U.S. offices (including $354 and $303 as of September 30, 2018 and December 31, 2017, respectively, at fair value)351,291
318,613
Non-interest-bearing deposits in offices outside the U.S.83,200
87,440
Interest-bearing deposits in offices outside the U.S. (including $1,086 and $1,162 as of September 30, 2018 and December 31, 2017, respectively, at fair value)459,239
426,889
Total deposits$1,005,176
$959,822
Federal funds purchased and securities loaned and sold under agreements to repurchase (including $48,148 and $40,638 as of September 30, 2018 and December 31, 2017, respectively, at fair value)175,915
156,277
Brokerage payables73,346
61,342
Trading account liabilities147,652
125,170
Short-term borrowings (including $5,041 and $4,627 as of September 30, 2018 and December 31, 2017, respectively, at fair value)33,770
44,452
Long-term debt (including $36,771 and $31,392 as of September 30, 2018 and December 31, 2017, respectively, at fair value)235,270
236,709
Other liabilities (including $19,947 and $13,961 as of September 30, 2018 and December 31, 2017, respectively, at fair value)56,173
57,021
Total liabilities$1,727,302
$1,640,793
Stockholders’ equity 
 
Preferred stock ($1.00 par value; authorized shares: 30 million), issued shares: as of September 30, 2018—761,400 and as of December 31, 2017—770,120, at aggregate liquidation value
$19,035
$19,253
Common stock ($0.01 par value; authorized shares: 6 billion), issued shares: as of September 30, 2018—3,099,567,177 and as of December 31, 2017—3,099,523,273
31
31
Additional paid-in capital107,825
108,008
Retained earnings148,436
138,425
Treasury stock, at cost: September 30, 2018—657,430,364 shares and
  December 31, 2017—529,614,728 shares
(39,678)(30,309)
Accumulated other comprehensive income (loss) (AOCI)(38,645)(34,668)
Total Citigroup stockholders’ equity$197,004
$200,740
Noncontrolling interest859
932
Total equity$197,863
$201,672
Total liabilities and equity$1,925,165
$1,842,465

The following table presents certain liabilities of consolidated VIEs, which are included in the Consolidated Balance Sheet above. The liabilities in the table below include third-party liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. The liabilities also exclude amounts where creditors or beneficial interest holders have recourse to the general credit of Citigroup.
 September 30, 
 2018December 31,
In millions of dollars(Unaudited)2017
Liabilities of consolidated VIEs for which creditors or beneficial interest holders
  do not have recourse to the general credit of Citigroup
 
 
Short-term borrowings$12,307
$10,142
Long-term debt27,625
30,492
Other liabilities748
611
Total liabilities of consolidated VIEs for which creditors or beneficial interest
  holders do not have recourse to the general credit of Citigroup
$40,680
$41,245
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITYCitigroup Inc. and Subsidiaries
(UNAUDITED)
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2018201720182017
Preferred stock at aggregate liquidation value   
 
Balance, beginning of period$19,035
$19,253
$19,253
$19,253
Redemption of preferred stock—
—
(218)—
Balance, end of period$19,035
$19,253
$19,035
$19,253
Common stock and additional paid-in capital   
 
Balance, beginning of period$107,755
$107,829
$108,039
$108,073
Employee benefit plans98
102
(187)(137)
Other3
(4)4
(9)
Balance, end of period$107,856
$107,927
$107,856
$107,927
Retained earnings   
 
Balance, beginning of period$145,211
$152,178
$138,425
$146,477
Adjustment to opening balance, net of taxes(1)
—
—
(84)(660)
Adjusted balance, beginning of period$145,211
$152,178
$138,341
$145,817
Citigroup’s net income4,622
4,133
13,732
12,095
Common dividends(2)
(1,127)(865)(2,777)(1,755)
Preferred dividends(270)(272)(860)(893)
Other(3)
—
—
—
(90)
Balance, end of period$148,436
$155,174
$148,436
$155,174
Treasury stock, at cost   
 
Balance, beginning of period$(34,413)$(19,342)$(30,309)$(16,302)
Employee benefit plans(4)
6
3
477
526
Treasury stock acquired(5)
(5,271)(5,490)(9,846)(9,053)
Balance, end of period$(39,678)$(24,829)$(39,678)$(24,829)
Citigroup’s accumulated other comprehensive income (loss)   
 
Balance, beginning of period$(37,494)$(29,899)$(34,668)$(32,381)
Adjustment to opening balance, net of taxes(1)
—
—
(3)504
Adjusted balance, beginning of period$(37,494)$(29,899)$(34,671)$(31,877)
Citigroup’s total other comprehensive income (loss)(1,151)8
(3,974)1,986
Balance, end of period$(38,645)$(29,891)$(38,645)$(29,891)
Total Citigroup common stockholders’ equity$177,969
$208,381
$177,969
$208,381
Total Citigroup stockholders’ equity$197,004
$227,634
$197,004
$227,634
Noncontrolling interests   
 
Balance, beginning of period$874
$1,088
$932
$1,023
Transactions between noncontrolling-interest shareholders and the related consolidated subsidiary—
(3)—
(3)
Transactions between Citigroup and the noncontrolling-interest shareholders(23)(56)(39)(50)
Net income attributable to noncontrolling-interest shareholders3
—
51
41
Distributions paid to noncontrolling-interest shareholders(2)(44)(38)(44)
Other comprehensive income (loss) attributable to noncontrolling-interest shareholders
8
12
(35)82
Other(1)(9)(12)(61)
Net change in noncontrolling interests$(15)$(100)$(73)$(35)
Balance, end of period$859
$988
$859
$988
Total equity$197,863
$228,622
$197,863
$228,622

(1)See Note 1 to the Consolidated Financial Statements for additional details.
(2)Common dividends declared were $0.32 per share in the first and second quarters and $0.45 per share in the third quarter of 2018. Common dividends declared were $0.16 per share in the first and second quarters and $0.32 for the third quarter of 2017.
(3)
Includes the impact of ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. See Note 1 to the Consolidated Financial Statements.


(4)Includes treasury stock related to (i) certain activity on employee stock option program exercises where the employee delivers existing shares to cover the option exercise, or (ii) under Citi’s employee restricted or deferred stock programs where shares are withheld to satisfy tax requirements.
(5)For the three and nine months ended September 30, 2018 and 2017, primarily consists of open market purchases under Citi’s Board of Directors-approved common stock repurchase program.

The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


CONSOLIDATED STATEMENT OF CASH FLOWSCitigroup Inc. and Subsidiaries
(UNAUDITED)
 Nine Months Ended September 30,
In millions of dollars20182017
Cash flows from operating activities of continuing operations 
 
Net income before attribution of noncontrolling interests$13,783
$12,136
Net income attributable to noncontrolling interests51
41
Citigroup’s net income$13,732
$12,095
Loss from discontinued operations, net of taxes—
(2)
Income from continuing operations—excluding noncontrolling interests$13,732
$12,097
Adjustments to reconcile net income to net cash provided by operating activities of continuing operations 
 
Net gains on significant disposals(1)
(247)(602)
Depreciation and amortization2,800
2,717
Provision for loan losses5,504
5,487
Realized gains from sales of investments(341)(626)
Net impairment losses on investments, goodwill and intangible assets113
75
Change in trading account assets(4,831)(14,383)
Change in trading account liabilities22,482
(1,015)
Change in brokerage receivables net of brokerage payables9,709
(3,136)
Change in loans HFS1,380
1,969
Change in other assets(8,696)(5,351)
Change in other liabilities(848)1,569
Other, net(10,691)(2,262)
Total adjustments$16,334
$(15,558)
Net cash provided by (used in) operating activities of continuing operations$30,066
$(3,461)
Cash flows from investing activities of continuing operations 
 
   Change in federal funds sold and securities borrowed or purchased under agreements to resell$(48,462)$(15,795)
   Change in loans(16,131)(41,569)
   Proceeds from sales and securitizations of loans4,021
7,019
   Purchases of investments(129,054)(151,362)
   Proceeds from sales of investments52,170
89,724
   Proceeds from maturities of investments82,940
67,166
   Proceeds from significant disposals(1)
314
3,411
   Capital expenditures on premises and equipment and capitalized software(2,682)(2,502)
   Proceeds from sales of premises and equipment, subsidiaries and affiliates
      and repossessed assets
174
292
   Other, net147
156
Net cash used in investing activities of continuing operations$(56,563)$(43,460)
Cash flows from financing activities of continuing operations 
 
   Dividends paid$(3,616)$(2,639)
   Redemption of preferred stock(218)—
   Treasury stock acquired(9,848)(9,071)
   Stock tendered for payment of withholding taxes(479)(402)
   Change in federal funds purchased and securities loaned or sold under agreements to repurchase19,638
19,461
   Issuance of long-term debt53,027
52,293
   Payments and redemptions of long-term debt(47,201)(29,785)
   Change in deposits45,354
34,632
   Change in short-term borrowings(10,681)7,448


CONSOLIDATED STATEMENT OF CASH FLOWS 
(UNAUDITED) (Continued)Nine Months Ended September 30,
In millions of dollars20182017
Net cash provided by financing activities of continuing operations$45,976
$71,937
Effect of exchange rate changes on cash and due from banks$(709)$599
Change in cash and due from banks and deposits with banks(2)
$18,770
$25,615
Cash, due from banks and deposits with banks at beginning of period(2)
180,516
160,494
Cash, due from banks and deposits with banks at end of period(2)
$199,286
$186,109
Cash and due from banks$25,727
$22,604
Deposits with banks173,559
163,505
Cash, due from banks and deposits with banks at end of period$199,286
$186,109
Supplemental disclosure of cash flow information for continuing operations 
 
Cash paid during the period for income taxes$3,261
$2,714
Cash paid during the period for interest16,278
11,604
Non-cash investing activities 
 
Transfers to loans HFS from loans$3,300
$3,800
Transfers to OREO and other repossessed assets94
85

(1)    See Note 2 to the Consolidated Financial Statements for further information on significant disposals.
(2)    Includes the impact of ASU 2016-18, Restricted Cash. See Notes 1 and 22 to the Consolidated Financial Statements.
The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION AND ACCOUNTING CHANGES

Basis of Presentation
The accompanying unaudited Consolidated Financial Statements as of September 30, 2018 and for the three- and nine-month periods ended September 30, 2018 and 2017 include the accounts of Citigroup Inc. and its consolidated subsidiaries.
In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation have been reflected. The accompanying unaudited Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and related notes included in Citigroup’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017 (2017 Annual Report on Form 10-K) and Citigroup’s Quarterly Reports on Form 10-Q for the quarters ended June 30, 2018 (Second Quarter of 2018 Form 10-Q) and March 31, 2018 (First Quarter of 2018 Form 10-Q).
Certain financial information that is normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), but is not required for interim reporting purposes, has been condensed or omitted.
Management must make estimates and assumptions that affect the Consolidated Financial Statements and the related footnote disclosures. While management uses its best judgment, actual results could differ from those estimates.
As noted above, the Notes to Consolidated Financial Statements are unaudited.
Throughout these Notes, “Citigroup,” “Citi” and the “Company” refer to Citigroup Inc. and its consolidated subsidiaries.
Certain reclassifications have been made to the prior periods’ financial statements and notes to conform to the current period’s presentation.

ACCOUNTING CHANGES

Revenue Recognition
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (Revenue Recognition), which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU defines the promised good or service as the performance obligation under the contract.
While the guidance replaces most existing revenue recognition guidance in GAAP, the ASU is not applicable to financial instruments and, therefore, does not impact a majority of the Company’s revenues, including net interest
income, loan fees, gains on sales and mark-to-market accounting.
In accordance with the new revenue recognition standard, Citi has identified the specific performance obligation (promised services) associated with the contract with the customer and has determined when that specific performance obligation has been satisfied, which may be at a point in time or over time depending on how the performance obligation is defined. The contracts with customers also contain the transaction price, which consists of fixed consideration and/or consideration that may vary (variable consideration), and is defined as the amount of consideration an entity expects to be entitled to when or as the performance obligation is satisfied, excluding amounts collected on behalf of third parties (including transaction taxes). The amounts recognized at the point in time the performance obligation is satisfied may differ from the ultimate transaction price associated with that performance obligation when a portion of it is based on variable consideration. For example, some consideration is based on the client’s month-end balance or market values which are unknown at the time the contract is executed. The remaining transaction price amount, if any, will be recognized as the variable consideration becomes determinable. In certain transactions, the performance obligation is considered satisfied at a point in time in the future. In this instance, Citi defers revenue on the balance sheet that will only be recognized upon completion of the performance obligation.
The new revenue recognition standard further clarified the guidance related to reporting revenue gross as principal versus net as an agent. In many cases, Citi outsources a component of its performance obligations to third parties. The Company has determined that it acts as principal in the majority of these transactions and therefore presents the amounts paid to these third parties gross within operating expenses.
The Company has retrospectively adopted this standard as of January 1, 2018 and as a result was required to report amounts paid to third parties where Citi is principal to the contract within Operating expenses. The adoption resulted in an increase in both revenue and expenses of approximately $250 million for the three-month period ended September 30, 2018 and approximately $750 million for the nine-month period ended September 30, 2018, respectively, while increasing approximately $1 billion for the year ended December 31, 2017 with similar amounts for prior periods. Prior to adoption, these expense amounts were reported as contra revenue primarily within Commissions and fees and Administration and other fiduciary fees revenue. Accordingly, prior periods have been reclassified to conform to the new presentation.
See Note 5 to the Consolidated Financial Statements for a description of the Company’s revenue recognition policies for Commissions and fees and Administration and other fiduciary fees.



Income Tax Impact of Intra-Entity Transfers of Assets
In October 2016, the FASB issued ASU No. 2016-16, Income Taxes—Intra-Entity Transfers of Assets Other Than Inventory, which requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The ASU was effective January 1, 2018 and was adopted as of that date. The impact of this standard was an increase of DTAs by approximately $300 million, a decrease of retained earnings by approximately $80 million and a decrease of prepaid tax assets by approximately $380 million. 

Clarifying the Definition of a Business
In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The definition of a business directly and indirectly affects many areas of accounting (e.g., acquisitions, disposals, goodwill and consolidation). The ASU narrows the definition of a business by introducing a quantitative screen as the first step, such that if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, then the set of transferred assets and activities is not a business. If the set is not scoped out from the quantitative screen, the entity then evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs.
The ASU iswas effective for public entities, including Citi, as of January 1, 2018.2018 with prospective application. The ASU will be applied prospectively, with early adoption permitted. Theongoing impact of the ASU will depend upon the acquisition and disposal activities of Citi. If fewer transactions qualify as a business, there could be less initial recognition of goodwill, but also less goodwill allocated to disposals.

Changes in Accounting for Pension and Postretirement (Benefit) Expense
In March 2017, the FASB issued ASU No. 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, which changes the income statement presentation of net benefit expense and requires restating the Company’s financial statements for each of the earlier periods presented in Citi’s annual and interim financial statements. The change in presentation iswas effective for annual and interim periods starting January 1, 2018. The ASU requires that only the service cost component of net benefit expense be included in the Compensation and benefits line on the income statement. The other components of net benefit expense will beare required to be presented outside of the Compensation and benefits line and will beare presented in Other operating expenseexpenses. Since both of these income statement line items are part of Operating expenses, total Operating expenses and Net income will not change, nor will there be any change in Net income.change. This change in presentation isdid not expected to have a material effect on the Compensation and benefits and on Other operating expenses lines in the income statement.and is applied prospectively. The components of
the net benefit expense are currently disclosed in Note 78 to the Consolidated Financial Statements.
 The new standard also changes the components of net benefit expense that are eligible for capitalization when employee costs are capitalized in connection with various activities, such as internally developed software, construction-in-progress and loan origination costs. Prospectively from January 1, 2018, only the service cost component of net benefit expense may be capitalized.  Existing capitalized balances are not affected. The Company is currently evaluating the portion of net benefits cost that continues to beThis change in amounts eligible for capitalization does not have a material effect on the Company’s Consolidated Financial Statements and the portion that is not eligible.related disclosures.

Hedging
In August 2017, the FASB issued ASU No. 2017-12, Targeted Improvements to Accounting for Hedging Activities, which will better alignaligns an entity’s risk management activities and financial reporting for hedging relationships through changes to the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The mandatory effective date for calendar year-end public companies is January 1, 2019 butASU requires the amendments may be early adopted in any interim or annual period after issuance. The targeted improvementschange in the ASU will allow Citi increased flexibility to structure hedgesfair value of fixed rate instruments and floating rate instruments.  Application of the ASU is expected to reduce the amount of ineffectiveness as the revised accounting guidance will better reflect the economics of our risk management activities and will also reduce the volatility associated with foreign currency hedging.  The ASU requires the hedging instrument to be presented in the same income statement line item as the hedged item and also requires expanded disclosures. Citi isadopted this standard on January 1, 2018 and transferred approximately $4 billion of pre-payable mortgage-backed securities and municipal bonds from held-to-maturity (HTM) into available-for-sale (AFS) securities classification as permitted as a one-time transfer upon adoption of the standard, as these assets were deemed to be eligible to be hedged under the last of layer hedge strategy. The impact to opening retained earnings was immaterial. See Note 19 to the Consolidated Financial Statements for more information.

Recognition and Measurement of Financial Assets and Financial Liabilities
In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. In February 2018, the FASB issued ASU No. 2018-03, Technical Corrections and Improvements to Financial Instruments—Overall (Subtopic 825-10), to clarify certain provisions in ASU 2016-01.
The ASUs require entities to present separately in AOCI the portion of the total change in the processfair value of evaluating whethera liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. The ASUs also require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, thus eliminating the AFS category for equity investments. However, Federal Reserve Bank and Federal Home Loan Bank stock, as well as certain exchange seats, will continue to be presented at cost. The


ASUs also provide an instrument-by-instrument election to measure non-marketable equity investments using a measurement alternative. Under the measurement alternative, the investment is carried at cost plus or minus changes resulting from observable prices in orderly transactions for the identical or a similar investment of the same issuer. Equity securities under the measurement alternative are also assessed for impairment. Finally, the ASUs require that fair value disclosures for financial instruments not measured at fair value on the balance sheet be presented at their exit prices (e.g., held-for-investment loans).
Citi early adoptadopted the standard beforeprovisions of ASU 2016-01
related to presentation of the mandatorychange in fair value of liabilities for which the fair value option was elected, related to changes in Citigroup’s own credit spreads in Accumulated other comprehensive income (loss) (AOCI) effective date.January 1, 2016. Accordingly, since the first quarter of 2016, these amounts have been reflected as a component of AOCI, whereas these amounts were previously recognized in Citigroup’s revenues and net income. The impact of adopting this amendment resulted in a cumulative catch-up reclassification from Retained earnings to AOCI of an accumulated after-tax loss of approximately $15 million at January 1, 2016. Financial statements for periods prior to 2016 were not subject to restatement under the provisions of this ASU. For additional information, see Notes 17, 20 and 21 to the Consolidated Financial Statements.
The other provisions of ASU 2016-01, as discussed above, were effective on January 1, 2018. Citi has adopted both ASU 2016-01 and ASU 2018-03 as of January 1, 2018. Accordingly, as of the first quarter of 2018, the changes to accounting for equity securities and fair value disclosures have been reflected in Citigroup’s financial statements. The impact of adopting the change to AFS equity securities resulted in a cumulative catch-up reclassification from AOCI to Retained earnings of an accumulated after-tax gain of approximately $3 million at January 1, 2018. Citi elected the measurement alternative for all non-marketable equity investments that no longer qualify for cost measurement under the ASUs. This provision in the ASUs was adopted prospectively. Financial statements for periods prior to 2018 were not subject to restatement under the provisions of the ASUs. For additional information, see Notes 12, 17 and 20to the Consolidated Financial Statements.

Statement of Cash Flows
In November 2016, the FASB issued ASU No. 2016-18, Restricted Cash,which requires that companies present cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents (restricted cash) when reconciling beginning-of-period and end-of-period totals on the Statement of Cash Flows. In connection with the adoption of the ASU, Citigroup also changed its definition of cash and cash equivalents to include all of Cash and due from banks and predominately all of Deposits with banks. The Company has retrospectively adopted this ASU as of January 1, 2018 and as a result Net cash provided by investing activities of continuing operations on the
Statement of Cash Flows increased by $26.1 billion for the nine months ended September 30, 2017.
In August 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments,which provides guidance on the classification and presentation of certain cash receipts and payments on the Statement of Cash Flows. The Company has retrospectively adopted this ASU as of January 1, 2018, which resulted in immaterial changes to Citi’s Consolidated Statement of Cash Flows.

Premium Amortization on Purchased Callable Debt Securities
In March 2017, the FASB issued Accounting Standards Update (ASU) No. 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities, which amends the amortization period for certain purchased callable debt securities held at a premium. The ASU requires entities to amortize premiums on debt securities by the first call date when the securities have fixed and determinable call dates and prices. The scope of the ASU includes all accounting premiums, such as purchase premiums and cumulative fair value hedge adjustments. The ASU does not change the accounting for discounts, which continue to be recognized over the contractual life of a security.
Citi early adopted the ASU in the second quarter of 2017, with an effective date of January 1, 2017. Adoption of the ASU is on a modified retrospective basis through a cumulative effect adjustment to Retained earnings as of the beginning of the year of adoption. Adoption of the ASU primarily affected Citi’s AFS and HTM portfolios of callable state and municipal debt securities. The ASU adoption resulted in a net reduction to total stockholders’ equity of $156 million (after-tax), effective as of January 1, 2017. This amount is composed of a reduction of approximately $660 million to Retained earnings for the incremental amortization of purchase premiums and cumulative hedge adjustments generated under fair value hedges of these callable debt securities, offset by an increase to AOCI of $504 million related to the cumulative fair value hedge adjustments reclassified to Retained earnings for AFS debt securities.



2. DISCONTINUED OPERATIONS AND SIGNIFICANT DISPOSALS

Summary of Discontinued Operations
The following sales are reported as Discontinued operations within Corporate/Other.

Sale of Egg Banking plc Credit Card Business
Citi sold theits German retail banking operations and Egg Banking plc credit card business in 2011.2008 and 2011, respectively. Residual items from the disposal resulted in losses fromthese disposals are summarized below. All Discontinued operations, net of taxes, of $5 million and $24 million for the three months ended September 30, 2017 and 2016, respectively, and $2 million and $46 million for the nine months ended September 30, 2017 and 2016, respectively.

Combined Results for Discontinued Operations
The following summarizes financial information for allresults are recorded within Discontinued operations for which Citi continues to have minimal residual impact associated with the sold operations:Corporate/Other.
Three Months Ended  September 30,Nine Months Ended September 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
In millions of dollars20172016201720162018201720182017
Total revenues, net of interest expense$—
$—
$—
$—
$—
$—
$—
$—
Loss from discontinued operations$(9)$(37)$(4)$(76)$(8)$(9)$(17)$(4)
Benefit for income taxes(4)(7)(2)(21)—
(4)(17)(2)
Loss from discontinued operations, net of taxes$(5)$(30)$(2)$(55)$(8)$(5)$—
$(2)

Cash flows for Discontinueddiscontinued operations were not material for the periods presented.

Significant Disposals
TheDuring the third quarter of 2018, one previously disclosed significant disposal transaction was completed as summarized below. There were no new significant disposal transactions during 2017 and 2016 described below were identified as significant disposals. The major classes of assets and liabilities that are derecognized from the Consolidated Balance Sheet at closing and the income related to each business until the disposal date are presented below.

Novation of the 80% Primerica Coinsurance Agreement
Effective January 1, 2016, Citi completed a novation (an arrangement that extinguishes Citi’s rights and obligations under a contract) of the Primerica 80% coinsurance agreement, which was part of Corporate/Other, to a third-party re-insurer. The novation resulted in revenues of $404 million recorded in Other revenue ($263 million after-tax) during the first quarter of 2016. Furthermore, the novation resulted in derecognition of $1.5 billion of available-for-sale securities and cash, $0.95 billion of deferred acquisition costs and $2.7 billion of insurance liabilities.


Exit of U.S. Mortgage Service Operations
As previously disclosed, Citigroup signed agreements during the first quarter of 2017 to effectively exit its direct U.S. mortgage servicing operations by the end of 2018 to intensify focus on originations. The exit of the mortgage servicing operations included the sale of mortgage servicing rights and execution of a subservicing agreement for the remaining Citi-owned loans and certain other mortgage servicing rights. As part of this transaction, Citi is also transferring certain employees.
This transaction, which was part of Corporate/Other, resulted in a pretax loss of $331 million ($207 million after-tax) recorded in Other revenue during the first quarter of 2017. The loss on sale did not include certain other costs and charges related to the disposed operation recorded primarily in Operating expenses in the first quarter of 2017, resulting in a total pretax loss of $382 million. As part of the completed sale, during the first quarter of 2017, Citi derecognized a total of $1,162 million of servicing-related assets, including $1,046 million of mortgage servicing rights, related to approximately 750,000 Fannie Mae and Freddie Mac held loans with outstanding balances of approximately $93 billion. Excluding the loss on sale and the additional charges, income before taxes for the disposed operation was immaterial for the three and nine months ended September 30, 2018. For a description of the Company’s significant disposal transactions and financial impact, see Note 2 to the Consolidated Financial Statements in Citi’s 2017 and 2016.Annual Report on Form 10-K.

Sale of CitiFinancial Canada Consumer FinanceMexico Asset Management Business
On March 31, 2017,September 21, 2018, Citi completed the sale of CitiFinancial Canada (CitiFinancial),its Mexico asset management business, which was part of Corporate/OtherLatin America Global Consumer Banking (GCB) and included 220 retail branches and approximately 1,400 employees.. As part of the sale, Citi derecognized totalnet assets of approximately $1.9 billion,$96 million, including $1.7 billiongoodwill of $32 million, already classified as held-for-sale beginning in consumer loans (net of allowance), and total liabilities of approximately $1.5 billion related to intercompany borrowings, which were settled at closing of the transaction. Separately, during the firstfourth quarter of 2017, CitiFinancial settled $0.4 billion of debt issued through loan securitizations.2017. The sale of CitiFinancial generatedtransaction resulted in a pretax gain on sale of $350approximately $250 million (approximately $150 million after-tax) recorded in Other revenue ($178 million after-tax) duringin the firstthird quarter of 2017.2018.
Income before taxes, excluding the pretax gain on sale, of the divested business was immaterial for the periods presented. Going forward, revenues in Latin America GCB will reflect the loss of ongoing operating revenues from the Mexico asset management business. However, this impact should be partially offset by lower operating expenses related to the asset management business, as follows:
 Three Months Ended 
 September 30,		Nine Months Ended 
 September 30,
In millions of dollars2017201620172016
Income before taxes$—
$43
$41
$121
well as expected growth in distribution revenues resulting from the transaction over time.  












Sale of a Fixed Income Analytics Business and an Index Business
On August 31, 2017, Citi completed the sale of a fixed income analytics (Yield Book) and a fixed income index business that were part of Markets and Securities Services within Institutional Clients Group (ICG). As part of the sale, Citi derecognized total assets of approximately $112 million, including goodwill of $72 million, while the derecognized liabilities were approximately $18 million. The transaction generated a pretax gain on sale of $580 million ($355 million after-tax) recorded in Other revenue during the third quarter of 2017.
Income before taxes for the divested businesses is as follows:
 Three Months Ended 
 September 30,		Nine Months Ended 
 September 30,
In millions of dollars2017201620172016
Income before taxes$13
$12
$31
$43







3. BUSINESS SEGMENTS
Citigroup’s activities are conducted through the following business segments: Global Consumer Banking (GCB)GCB and ICG Institutional Clients Group (ICG)business segments.. In addition, Corporate/Other includes activities not assigned to a specific business segment, as well as certain North America and international loan portfolios, discontinued operations and other legacy assets.
The prior-period balances reflect reclassifications to conform the presentation for all periods to the current period’s presentation. Effective January 1, 2017,2018, financial data was reclassified to reflect:

the reportingadoption of the remaining businesses and portfolios of assets of Citi Holdings as part ofASU No. 2014-09, Corporate/OtherRevenue Recognition, which prioroccurred on January 1, 2018 on a retrospective basis. See “Accounting Changes” in Note 1 to the first quarter of 2017, was a separately reported business segment;Consolidated Financial Statements;
the re-attribution of certain treasury-related costs between Corporate/Other, and GCB and ICG;
the re-attribution of regional revenues within ICG;and
certain other immaterial reclassifications.

Citi’s consolidated results remain unchanged for all periods presented as a result of the changes and reclassifications discussed above.
 

For additional information regarding Citigroup’s business segments, see Note 3 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
The following table presents certain information regarding the Company’s continuing operations by segment:














Three Months Ended September 30, Three Months Ended September 30, 
Revenues,
net of interest expense(1)
Provision (benefits)
for income taxes
Income (loss) from
continuing operations(2)
Identifiable assets
Revenues,
net of interest expense(1)
Provision (benefits)
for income taxes
Income (loss) from
continuing operations(2)
Identifiable assets
In millions of dollars, except identifiable assets in billions201720162017201620172016September 30,
2017		December 31, 2016201820172018201720182017September 30,
2018		December 31, 2017
Global Consumer Banking$8,433
$8,164
$636
$677
$1,174
$1,250
$419
$412
$8,654
$8,470
$493
$635
$1,567
$1,170
$427
$428
Institutional Clients Group9,231
8,459
1,394
1,202
3,062
2,660
1,370
1,277
9,241
9,430
862
1,394
3,117
3,062
1,404
1,336
Corporate/Other509
1,137
(164)(146)(99)(23)100
103
494
519
116
(163)(51)(95)94
78
Total$18,173
$17,760
$1,866
$1,733
$4,137
$3,887
$1,889
$1,792
$18,389
$18,419
$1,471
$1,866
$4,633
$4,137
$1,925
$1,842
(1)
Includes total revenues, net of interest expense (excluding Corporate/Other), in North America of $8.9$8.5 billion and $8.4$8.9 billion; in EMEA of $2.9 billion and $2.7 billion; in Latin America of $2.7 billion and $2.5 billion; in Latin America of $2.4 billion and $2.2 billion; and in Asia of $3.7$3.8 billion and $3.5$3.8 billion for the three months ended September 30, 20172018 and 2016,2017, respectively. These regional numbers exclude Corporate/Other, which largely operates within the U.S.
(2)
Includes pretax provisions for credit losses and for benefits and claims in the GCB results of $2.2$1.9 billion and $1.8$2.2 billion; in the ICG results of $(164)$71 million and $(90)$(164) million; and in the Corporate/Other results of $(50)$(30) million and $18$(50) million for the three months ended September 30, 20172018 and 2016,2017, respectively.

Nine Months Ended September 30, 2017Nine Months Ended September 30,
Revenues,
net of interest expense(1)
Provision (benefits)
for income taxes
Income (loss) from
continuing operations(2)
Revenues,
net of interest expense(1)
Provision (benefits)
for income taxes
Income (loss) from
continuing operations(2)
In millions of dollars201720162017201620172016201820172018201720182017
Global Consumer Banking$24,285
$23,552
$1,867
$1,978
$3,306
$3,729
$25,337
$24,389
$1,357
$1,863
$4,240
$3,296
Institutional Clients Group27,570
25,043
4,096
3,195
8,853
7,144
28,780
28,170
2,890
4,096
9,683
8,853
Corporate/Other2,339
4,268
(439)(238)(21)569
1,613
2,381
109
(435)(140)(11)
Total$54,194
$52,863
$5,524
$4,935
$12,138
$11,442
$55,730
$54,940
$4,356
$5,524
$13,783
$12,138

(1)
Includes total revenues, net of interest expense, in North America of $25.8$25.4 billion and $24.2$26.0 billion; in EMEA of $8.3$9.1 billion and $7.3$8.4 billion; in Latin America of $7.0$7.8 billion and $6.7$7.2 billion; and in Asia of $10.8$11.8 billion and $10.4$10.9 billion for the nine months ended September 30, 20172018 and 2016,2017, respectively. Regional numbers exclude Corporate/Other, which largely operates within the U.S.
(2)
Includes pretax provisions for credit losses and for benefits and claims in the GCB results of $5.8$5.7 billion and $4.7$5.8 billion; in the ICG results of $(282)$55 million and $382$(282) million; and in Corporate/Other results of $(130)$(155) million and $90$(130) million for the nine months ended September 30, 20172018 and 2016,2017, respectively.




4.  INTEREST REVENUE AND EXPENSE
Interest revenue and Interest expense consisted of the following:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
Interest revenue      
Loan interest, including fees$10,652
$10,229
$30,798
$29,739
$11,639
$10,745
$33,721
$31,082
Deposits with banks486
247
1,156
703
629
486
1,554
1,156
Federal funds sold and securities borrowed or purchased under agreements to resell858
636
2,347
1,947
1,425
858
3,800
2,348
Investments, including dividends2,104
1,887
6,122
5,679
2,388
2,104
6,996
6,122
Trading account assets(1)
1,429
1,433
4,176
4,399
1,655
1,429
4,789
4,175
Other interest292
221
846
709
434
292
1,192
846
Total interest revenue$15,821
$14,653
$45,445
$43,176
$18,170
$15,914
$52,052
$45,729
Interest expense      
Deposits(2)
$1,775
$1,443
$4,793
$3,953
$2,580
$1,775
$6,821
$4,793
Federal funds purchased and securities loaned or sold under agreements to repurchase712
459
1,881
1,488
1,250
712
3,423
1,881
Trading account liabilities(1)
169
102
462
286
273
169
724
462
Short-term borrowings318
90
719
300
578
318
1,572
719
Long-term debt1,405
1,080
4,126
3,207
1,687
1,405
4,873
4,126
Total interest expense$4,379
$3,174
$11,981
$9,234
$6,368
$4,379
$17,413
$11,981
Net interest revenue$11,442
$11,479
$33,464
$33,942
$11,802
$11,535
$34,639
$33,748
Provision for loan losses2,146
1,746
5,487
5,022
1,906
2,146
5,504
5,487
Net interest revenue after provision for loan losses$9,296
$9,733
$27,977
$28,920
$9,896
$9,389
$29,135
$28,261
(1)
Interest expense on Trading account liabilities of ICG is reported as a reduction of interest revenue from Trading account assets.
(2)Includes deposit insurance fees and charges of $301$311 million and $336$301 million for the three months ended September 30, 20172018 and 2016,2017, respectively, and $936$1,006 million and $838$935 million for the nine months ended September 30, 20172018 and 2016,2017, respectively.





5.  COMMISSIONS AND FEES; ADMINISTRATION
AND OTHER FIDUCIARY FEES

The primary components of Citi’s Commissions and fees revenue are investment banking fees, trading-relatedbrokerage commissions, credit- and bank-card income and deposit-related fees.
Investment banking fees are substantially composed of underwriting and advisory revenues. Such fees are recognized at the point in time when Citigroup’s performance under the terms of a contractual arrangement is completed, which is typically at the closing of a transaction. Reimbursed expenses related to tradethese transactions are recorded as revenue and securities servicesare included within investment banking fees. In certain instances for advisory contracts, Citi will receive amounts in advance of the deal’s closing. In these instances, the amounts received will be recognized as a liability and not recognized in revenue until the transaction closes. The contract liability amount for the periods presented was negligible. Out-of-pocket expenses associated with underwriting activity are deferred and recognized at the time the related revenue is recognized, while out-of-pocket expenses associated with advisory arrangements are expensed as incurred. In general, expenses incurred related to investment banking transactions, whether consummated or not, are recorded in ICG Other operating expenses. The Company has determined that it acts as principal in the majority of these transactions and credit cardtherefore presents expenses gross within Other operating expenses.
Brokerage commissions primarily include commissions and bank card fees. For additional information regarding
certain componentsfees from the following: executing transactions for clients on exchanges and over-the-counter markets; sales of mutual funds and other annuity products; and assisting clients in clearing transactions, providing brokerage services and other such activities. Brokerage commissions are recognized in Commissions and fees revenue, seeat the point in time the associated service is fulfilled, generally on trade-execution date. Gains or losses, if any, on these transactions are included in Principal transactions (see Note 56 to the Consolidated Financial StatementsStatements). Sales of certain investment products include a portion of variable consideration associated with the underlying product. In these instances, a portion of the revenue associated with the sale of the product is not recognized until the variable consideration becomes fixed. The Company recognized $130 million and $107 million of revenue related to such variable consideration for the three months ended September 30, 2018 and 2017, respectively, and $402 million and $302 million for the nine months ended September 30, 2018 and 2017, respectively. These amounts primarily relate to performance obligations satisfied in Citi’s 2016prior periods.
Credit- and bank-card income is primarily composed of interchange fees, which are earned by card issuers based on purchase sales, and certain card fees, including annual fees. Costs related to customer reward programs and certain payments to partners (primarily based on program sales, profitability and customer acquisitions) are recorded as a reduction of credit- and bank-card income. Interchange revenues are recognized as earned on a daily basis when Citi's performance obligation to transmit funds to the payment networks has been satisfied. Annual Reportcard fees, net of origination costs, are deferred and amortized on Form 10-K.a straight-line basis over a 12-month period. Costs related to card reward programs are recognized when the rewards are earned by the cardholders. Payments to partners are recognized when incurred.
Deposit-related fees consist of service charges on deposit accounts and fees earned from performing cash management activities and other deposit account services. Such fees are recognized in the period in which the related service is provided.
Transactional service fees primarily consist of fees charged for processing services such as cash management, global payments, clearing, international funds transfer and other trade services. Such fees are recognized as/when the associated service is satisfied, which normally occurs at the point in time the service is requested by the customer and provided by Citi.
Insurance distribution revenue consists of commissions earned from third-party insurance companies for marketing and selling insurance policies on behalf of such entities. Such commissions are recognized in Commissions and fees at the point in time the associated service is fulfilled, generally when the insurance policy is sold to the policyholder. Sales of certain insurance products include a portion of variable consideration associated with the underlying product. In these instances, a portion of the revenue associated with the sale of the policy is not recognized until the variable consideration becomes determinable. The Company recognized $92 million and $115 million for the three months ended September 30, 2018 and 2017, respectively, and $296 million and $342 million for the nine months ended September 30, 2018 and 2017, respectively. These amounts primarily relate to performance obligations in prior periods.
Insurance premiums consist of premium income from insurance policies that Citi has underwritten and sold to policyholders.


The following table presentstables present Commissions and fees revenue:
 Three Months Ended September 30,Nine Months Ended September 30,
 20182018
In millions of dollarsICGGCBCorporate/OtherTotalICGGCBCorporate/OtherTotal
Investment banking$856
$—
$—
$856
$2,695
$—
$—
$2,695
Brokerage commissions453
199
—
652
1,510
654
—
2,164
Credit- and bank-card income   

    
     Interchange fees268
2,063
1
2,332
804
5,963
11
6,778
     Card-related loan fees16
172
—
188
47
474
12
533
     Card rewards and partner payments(125)(2,130)—
(2,255)(375)(6,070)(11)(6,456)
Deposit-related fees(1)
239
160
—
399
711
503
1
1,215
Transactional service fees171
22
1
194
543
64
4
611
Corporate finance(2)
145
1
—
146
506
4
—
510
Insurance distribution revenue(3)
3
144
(4)143
13
429
6
448
Insurance premiums(3)
—
31
(2)29
—
96
(4)92
Loan servicing42
27
8
77
118
89
31
238
Other10
29
3
42
20
90
6
116
Total commissions and fees(4)
$2,078
$718
$7
$2,803
$6,592
$2,296
$56
$8,944

 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620172016
Investment banking$911
$726
$2,689
$2,053
Trading-related556
519
1,670
1,664
Trade and securities services412
384
1,224
1,176
Credit cards and bank cards406
372
1,081
987
Corporate finance(1)
171
164
578
528
Other consumer(2)
188
173
521
497
Checking-related121
140
363
360
Loan servicing80
71
254
235
Other86
95
247
332
Total commissions and fees$2,931
$2,644
$8,627
$7,832
 Three Months Ended September 30,Nine Months Ended September 30,
 20172017
In millions of dollarsICGGCBCorporate/OtherTotalICGGCBCorporate/OtherTotal
Investment banking$961
$—
$—
$961
$2,840
$—
$—
$2,840
Brokerage commissions459
222
1
682
1,431
615
3
2,049
Credit- and bank-card income        
     Interchange fees242
1,912
24
2,178
705
5,507
87
6,299
     Card-related loan fees13
172
13
198
39
526
41
606
     Card rewards and partner payments(105)(1,822)(8)(1,935)(316)(5,352)(49)(5,717)
Deposit-related fees(1)
249
188
4
441
696
554
12
1,262
Transactional service fees185
21
11
217
556
74
44
674
Corporate finance(2)
183
2
—
185
616
4
—
620
Insurance distribution revenue(3)
5
142
17
164
10
425
58
493
Insurance premiums(3)
—
32
(1)31
—
97
(4)93
Loan servicing38
25
25
88
109
79
89
277
Other2
25
4
31
(36)64
28
56
Total commissions and fees(4)
$2,232
$919
$90
$3,241
$6,650
$2,593
$309
$9,552
(1)Includes overdraft fees of $33 million and $35 million for the three months ended September 30, 2018 and 2017, respectively, and $95 million and $101 million for the nine months ended September 30, 2018 and 2017, respectively. Overdraft fees are accounted for under ASC 310.
(2)Consists primarily of fees earned from structuring and underwriting loan syndications.syndications or related financing activity. This activity is accounted for under ASC 310.
(2)(3)Primarily consistsPreviously reported as insurance premiums on the Consolidated Statement of Income.
(4)
Commissions and fees includes $(1,774) million and $(1,398) million not accounted for under ASC 606, Revenue from Contracts with Customers, for the three months ended September 30, 2018 and 2017, respectively, and $(4,967) million and $(4,023) million for the nine months ended September 30, 2018 and 2017, respectively. Amounts reported in Commissions and fees accounted for under other guidance primarily include card-related loan fees, for investment fund administration and management, third-party collections, commercial demand deposit accountscard reward programs and certain credit cardpartner payments, corporate finance fees, insurance premiums and loan servicing fees.




Administration and Other Fiduciary Fees
Administration and other fiduciary fees are primarily composed of custody fees and fiduciary fees.
The custody product is composed of numerous services related to the administration, safekeeping and reporting for both U.S. and non-U.S. denominated securities. The services offered to clients include trade settlement, safekeeping, income collection, corporate action notification, record-keeping and reporting, tax reporting and cash management. These services are provided for a wide range of securities, including but not limited to equities, municipal and corporate bonds, mortgage-backed and asset-backed securities, money market instruments, U.S. Treasuries and agencies, derivative instruments, mutual funds, alternative investments and precious metals. Custody fees are recognized as/when the associated promised service is satisfied, which normally occurs at the point in time the service is requested by the customer and provided by Citi.
Fiduciary fees consist of trust services and investment management services. As an escrow agent, Citi receives, safe-
keeps, services and manages clients’ escrowed assets such as cash, securities, property (including intellectual property), contracts or other collateral. Citi performs its escrow agent duties by safekeeping the funds during the specified time period agreed upon by all parties and therefore earns its revenue evenly during the contract duration.
Investment management services consist of managing assets on behalf of Citi’s retail and institutional clients. Revenue from these services primarily consists of asset-based fees for advisory accounts, which are based on the market value of the client’s assets and recognized monthly, when the market value is fixed. In some instances, the Company contracts with third-party advisors and with third-party custodians. The Company has determined that it acts as principal in the majority of these transactions and therefore presents the amounts paid to third parties gross within Other operating expenses.
The following table presents Administration and other fiduciary fees:

 Three Months Ended September 30,Nine Months Ended September 30,
 20182018
In millions of dollarsICGGCBCorporate/OtherTotalICGGCBCorporate/OtherTotal
Custody fees$371
$41
$18
$430
$1,138
$133
$50
$1,321
Fiduciary fees160
158
12
330
492
455
31
978
Guarantee fees136
14
1
151
403
43
5
451
Total administration and other fiduciary fees(1)
$667
$213
$31
$911
$2,033
$631
$86
$2,750
 Three Months Ended September 30,Nine Months Ended September 30,
 20172017
In millions of dollarsICGGCBCorporate/OtherTotalICGGCBCorporate/OtherTotal
Custody fees$397
$44
$14
$455
$1,135
$123
$41
$1,299
Fiduciary fees149
157
18
324
437
431
59
927
Guarantee fees134
13
3
150
400
39
7
446
Total administration and other fiduciary fees(1)
$680
$214
$35
$929
$1,972
$593
$107
$2,672
(1)
Administration and other fiduciary fees includes $151 million and $150 million for the three months ended September 30, 2018 and 2017, respectively, and $451 million and $446 million for the nine months ended September 30, 2018 and 2017, respectively, that are not accounted for under ASC 606, Revenue from Contracts with Customers. These amounts include guarantee fees.



6. PRINCIPAL TRANSACTIONS
Citi’sPrincipal transactions Principal transactionsrevenue consists of realized and unrealized gains and losses from trading activities. For additional information regarding PrincipalTrading activities include revenues from fixed income, equities, credit and commodities products and foreign exchange transactions that are managed on a portfolio basis characterized by primary risk. Not included in the table below is the impact of net interest revenue seerelated to trading activities, which is an
integral part of trading activities’ profitability. See Note 64 to the Consolidated Financial Statements for information about net interest revenue related to trading activities. Principal transactions include CVA (credit valuation adjustments on derivatives) and FVA (funding valuation adjustments) on over-the-counter derivatives. These adjustments are discussed further in Citi’s 2016 Annual Report on Form 10-K.Note 20 to the Consolidated Financial Statements.
In certain transactions, Citi incurs fees and presents these fees paid to third parties in operating expenses.
The following table presents Principal transactions
revenue:
 


















 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620172016
Global Consumer Banking(1)
$149
$162
$440
$469
Institutional Clients Group1,757
2,064
6,504
5,552
Corporate/Other (1)
264
12
810
(127)
Total Citigroup$2,170
$2,238
$7,754
$5,894
Interest rate risks(2)
$1,120
$1,282
$4,297
$3,229
Foreign exchange risks(3)
610
466
2,000
1,481
Equity risks(4)
158
81
404
76
Commodity and other risks(5)
92
171
330
436
Credit products and risks(6)
190
238
723
672
Total$2,170
$2,238
$7,754
$5,894
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2018201720182017
Interest rate risks(1)
$1,403
$1,180
$4,576
$4,421
Foreign exchange risks(2)
467
606
1,387
1,942
Equity risks(3)
311
154
997
440
Commodity and other risks(4)
244
112
544
434
Credit products and risks(5)
141
196
502
748
Total$2,566
$2,248
$8,006
$7,985
(1)Primarily relates to foreign exchange risks.
(2)Includes revenues from government securities and corporate debt, municipal securities, mortgage securities and other debt instruments. Also includes spot and forward trading of currencies and exchange-traded and over-the-counter (OTC) currency options, options on fixed income securities, interest rate swaps, currency swaps, swap options, caps and floors, financial futures, OTC options and forward contracts on fixed income securities.
(3)(2)Includes revenues from foreign exchange spot, forward, option and swap contracts, as well as foreign currency translation (FX translation) gains and losses.
(4)(3)Includes revenues from common, preferred and convertible preferred stock, convertible corporate debt, equity-linked notes and exchange-traded and OTC equity options and warrants.
(5)(4)Primarily includes revenues from crude oil, refined oil products, natural gas and other commodities trades.
(6)(5)Includes revenues from structured credit products.


7. INCENTIVE PLANS
For additional information on Citi’s incentive plans, see Note 7 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.


8. RETIREMENT BENEFITS
For additional information on Citi’s retirement benefits, see Note 8 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.

Net (Benefit) Expense
The following table summarizes the components of net (benefit) expense recognized in the Consolidated Statement of Income for the Company’s pension and postretirement plans for Significant Plans and All Other Plans:
Three Months Ended September 30,Three Months Ended September 30,
Pension plansPostretirement benefit plansPension plansPostretirement benefit plans
U.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plans
In millions of dollars2017201620172016201720162017201620182017201820172018201720182017
Qualified plans 
 
 
 
 
 
 
 
Benefits earned during the period$—
$1
$38
$39
$—
$—
$3
$1
$—
$1
$35
$38
$—
$—
$2
$3
Interest cost on benefit obligation124
126
76
70
9
6
27
24
132
131
73
76
6
9
26
27
Expected return on plan assets(217)(224)(77)(71)(2)(2)(24)(22)(210)(217)(71)(77)(4)(2)(22)(24)
Amortization of unrecognized 
  
 
 
 
 
 
Amortization of unrecognized: 
  
 
 
 
 
 
Prior service benefit—
—
(1)—
—
—
(2)(1)—
—
(1)(1)—
—
(2)(2)
Net actuarial loss43
43
15
19
—
—
8
8
39
45
14
15
—
—
7
8
Curtailment loss (1)
1
10
—
—
—
—
—
—
—
1
—
—
—
—
—
—
Settlement loss (gain) (1)
—
—
4
(2)—
—
—
—
Net qualified plans (benefit) expense$(49)$(44)$55
$55
$7
$4
$12
$10
Nonqualified plans expense$10
$12
$—
$—
$—
$—
$—
$—
Settlement loss(1)
—
—
—
4
—
—
—
—
Total net (benefit) expense$(39)$(32)$55
$55
$7
$4
$12
$10
$(39)$(39)$50
$55
$2
$7
$11
$12
























(1)Losses (gains) due to curtailment and settlement relate to repositioning and divestiture activities.

Nine Months Ended September 30,Nine Months Ended September 30,
Pension plansPostretirement benefit plansPension plansPostretirement benefit plans
U.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plans
In millions of dollars2017201620172016201720162017201620182017201820172018201720182017
Qualified plans 
 
 
 
 
 
 
 
Benefits earned during the period$1
$2
$112
$116
$—
$—
$7
$7
$1
$2
$111
$112
$—
$—
$7
$7
Interest cost on benefit obligation384
399
221
216
20
19
76
72
381
406
220
221
19
20
77
76
Expected return on plan assets(650)(660)(223)(217)(5)(7)(67)(65)(634)(650)(221)(223)(10)(5)(67)(67)
Amortization of unrecognized



 
 
  
 
 
Amortization of unrecognized:  
 
  
 
 
Prior service benefit—
—
(3)(1)—
—
(7)(7)—
1
(3)(3)—
—
(7)(7)
Net actuarial loss (gain)122
118
46
58
—
(1)25
24
Curtailment loss (gain) (1)
4
10
—
(3)—
—
—
—
Net actuarial loss128
129
41
46
—
—
22
25
Curtailment loss(1)
1
4
—
—
—
—
—
—
Settlement loss(1)
—
—
8
2
—
—
—
—
—
—
5
8
—
—
—
—
Net qualified plans (benefit) expense$(139)$(131)$161
$171
$15
$11
$34
$31
Nonqualified plans expense$31
$31
$—
$—
$—
$—
$—
$—
Total net (benefit) expense$(108)$(100)$161
$171
$15
$11
$34
$31
$(123)$(108)$153
$161
$9
$15
$32
$34

(1)Losses (gains) due to curtailment and settlement relate to repositioning and divestiture activities.







Funded Status and Accumulated Other Comprehensive Income (AOCI)
The following tables summarize the funded status and amounts recognized in the Consolidated Balance Sheet for the Company’s
Significant Plans.
Plans:
Nine Months Ended September 30, 2017Nine Months Ended September 30, 2018
Pension plansPostretirement benefit plansPension plansPostretirement benefit plans
In millions of dollarsU.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plans
Change in projected benefit obligation 
 
 
 
 
 
 
 
Projected benefit obligation at beginning of year$14,000
$6,522
$686
$1,141
$14,040
$7,433
$699
$1,261
Plans measured annually(28)(1,784)—
(303)(28)(1,987)—
(334)
Projected benefit obligation at beginning of year—Significant Plans$13,972
$4,738
$686
$838
$14,012
$5,446
$699
$927
First quarter activity25
802
(7)134
(576)151
(32)89
Second quarter activity161
9
63
72
(595)(344)—
(65)
Projected benefit obligation at June 30, 2017—Significant Plans$14,158
$5,549
$742
$1,044
Projected benefit obligation at June 30, 2018—Significant Plans$12,841
$5,253
$667
$951
Benefits earned during the period1
22
—
2
—
20
—
2
Interest cost on benefit obligation131
64
6
23
132
60
6
23
Actuarial loss95
104
2
12
Benefits paid, net of participants’ contributions(191)(108)(14)(15)
Curtailment loss (gain)(1)
1
(2)—
—
Actuarial gain(60)(59)—
(61)
Benefits paid, net of participants’ contributions and government subsidy(217)(68)(15)(14)
Foreign exchange impact and other(269)36
—
(6)—
48
—
48
Projected benefit obligation at September 30, 2017—Significant Plans$13,926
$5,665
$736
$1,060
Projected benefit obligation at period end—Significant Plans$12,696
$5,254
$658
$949

(1)Loss (gain) due to curtailment relates to repositioning activities.





Nine Months Ended September 30, 2017Nine Months Ended September 30, 2018
Pension plansPostretirement benefit plansPension plansPostretirement benefit plans
In millions of dollarsU.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plansU.S. plansNon-U.S. plans
Change in plan assets 
 
 
 
 
 
 
 
Plan assets at fair value at beginning of year$12,363
$6,149
$129
$1,015
$12,725
$7,128
$262
$1,119
Plans measured annually—
(1,167)—
(11)—
(1,305)—
(10)
Plan assets at fair value at beginning of year—Significant Plans$12,363
$4,982
$129
$1,004
$12,725
$5,823
$262
$1,109
First quarter activity159
903
$—
124
(349)115
(21)58
Second quarter activity186
(39)$(3)55
(220)(328)(4)(78)
Plan assets at fair value at June 30, 2017—Significant Plans
$12,708
$5,846
$126
$1,183
Plan assets at fair value at June 30, 2018—Significant Plans
$12,156
$5,610
$237
$1,089
Actual return on plan assets310
95
3
24
123
7
1
23
Company contributions, net of reimbursements63
11
10
—
13
15
153
—
Plan participants’ contributions—
1
—
—
Benefits paid, net of government subsidy(191)(109)(14)(15)
Benefits paid, net of participants’ contributions and government subsidy

(217)(68)(15)(14)
Foreign exchange impact and other(269)45
—
(6)—
40
—
56
Plan assets at fair value at September 30, 2017—Significant Plans$12,621
$5,889
$125
$1,186
Plan assets at fair value at period end—Significant Plans$12,075
$5,604
$376
$1,154
Funded status of the Significant Plans      
Qualified plans(1)
$(575)$224
$(611)$126
$36
$350
$(282)$205
Nonqualified plans(730)—
—
—
(657)—
—
—
Funded status of the plans at September 30, 2017—Significant Plans$(1,305)$224
$(611)$126
Net amount recognized 
 
 
 
Funded status of the plans at period end—Significant Plans$(621)$350
$(282)$205
Net amount recognized at period end 
 
 
 
Benefit asset$—
$683
$—
$126
$36
$850
$—
$205
Benefit liability(1,305)(459)(611)—
(657)(500)(282)—
Net amount recognized on the balance sheet—Significant Plans$(1,305)$224
$(611)$126
$(621)$350
$(282)$205
Amounts recognized in AOCI 
 
 
Amounts recognized in AOCI at period endAmounts recognized in AOCI at period end 
 
 
Prior service benefit$—
$30
$—
$91
$—
$25
$—
$80
Net actuarial (loss) gain(6,779)(1,051)39
(406)(6,313)(807)77
(284)
Net amount recognized in equity (pretax)—Significant Plans$(6,779)$(1,021)$39
$(315)$(6,313)$(782)$77
$(204)
Accumulated benefit obligation   
Qualified plans$13,193
$5,047
$736
$1,060
Nonqualified plans727
—
—
—
Accumulated benefit obligation at September 30, 2017—Significant Plans$13,920
$5,047
$736
$1,060
Accumulated benefit obligation at period end—Significant Plans$12,689
$4,980
$658
$949
(1)The U.S. qualified pension plan is fully funded under specifiedpursuant to the Employee Retirement Income Security Act of 1974, as amended (ERISA), funding rules as of January 1, 20172018 and no minimum required funding is expected for 2017.2018.



The following table shows the change in AOCI related to the Company’s pension, postretirement and post employment plans:
In millions of dollarsThree Months Ended 
 September 30, 2017		Nine Months Ended September 30, 2017Three Months Ended 
 September 30, 2018
Nine Months Ended
September 30, 2018
Beginning of period balance, net of tax(1)(2)
$(5,311)$(5,164)$(5,794)$(6,183)
Actuarial assumptions changes and plan experience(213)(721)181
1,300
Net asset gain due to difference between actual and expected returns123
419
Net asset loss due to difference between actual and expected returns(140)(919)
Net amortization59
171
49
161
Prior service cost—
(5)
Curtailment/settlement gain(3)
5
12
—
6
Foreign exchange impact and other(19)(141)(35)1
Change in deferred taxes, net16
89
(29)(134)
Change, net of tax$(29)$(176)$26
$415
End of period balance, net of tax(1)(2)
$(5,340)$(5,340)$(5,768)$(5,768)

(1)See Note 17 to the Consolidated Financial Statements for further discussion of net AOCI balance.
(2)Includes net-of-tax amounts for certain profit sharing plans outside the U.S.
(3)Gains due to curtailment and settlement relate to repositioning and divestiture activities.




Plan Assumptions
The discount rates utilized during the period in determining the pension and postretirement net (benefit) expense for the Significant Plans are as follows:
Net benefit (expense) assumed discount rates during the periodThree Months Ended
Sept. 30, 2017Jun. 30, 2017
Net (benefit) expense assumed discount rates during the periodThree Months Ended
Sept. 30, 2018Jun. 30, 2018
U.S. plans  
Qualified pension3.80%4.05%4.25%3.95%
Nonqualified pension3.753.954.253.95
Postretirement3.603.854.203.90
Non-U.S. plans   
Pension0.65-10.900.55-10.450.80-10.700.75-9.90
Weighted average4.874.834.884.86
Postretirement9.059.259.509.50

The discount rates utilized at period-end in determining the pension and postretirement benefit obligations for the Significant Plans are as follows:
Plan obligations assumed discount rates at period endedSept. 30, 2017June 30,
2017		Mar. 31, 2017Sept. 30, 2018Jun. 30, 2018Mar. 31, 2018
U.S. plans     
Qualified pension3.75%3.80%4.05%4.30%4.25%3.95%
Nonqualified pension3.653.753.954.304.253.95
Postretirement3.553.603.854.204.203.90
Non-U.S. plans   
Pension0.65-10.350.65-10.900.55-10.450.95-10.750.80-10.700.75-9.90
Weighted average4.864.874.835.084.884.86
Postretirement8.959.059.2510.109.50
 
Sensitivities of Certain Key Assumptions
The following table summarizes the estimated effect on the Company’s Significant Plans quarterly expense of a one-percentage-point change in the discount rate:
Three Months Ended September 30, 2017Three Months Ended September 30, 2018
In millions of dollarsOne-percentage-point increaseOne-percentage-point decreaseOne-percentage-point increaseOne-percentage-point decrease
Pension  
U.S. plans$7
$(10)$5
$(8)
Non-U.S. plans(5)7
(3)5
Postretirement  
U.S. plans1
(1)—
(1)
Non-U.S. plans(3)3
(2)2






Contributions
For the U.S. pension plans, there were no required minimum cash contributions during the first nine months of 2017.2018.

The following table summarizes the Company’s actual contributions for the nine months ended September 30, 20172018 and 2016,2017, as well as estimated expected Company contributions for the remainder of 20172018 and the actual contributions made infor the fourth quarterremainder of 2016.2017:
Pension plans Postretirement plans Pension plans Postretirement plans 
U.S. plans(1)
Non-U.S. plansU.S. plansNon-U.S. plans
U.S. plans(1)
Non-U.S. plansU.S. plansNon-U.S. plans
In millions of dollars2017201620172016201720162017201620182017201820172018201720182017
Company contributions(2) for the nine months ended September 30
$90
$541
$103
$58
$30
$6
$7
$4
$42
$90
$143
$109
$159
$30
$7
$7
Company contributions made or expected to be made during the remainder of the year16
15
35
68
—
—
2
5
Company contributions made during the remainder
of the year

—
15
—
26
—
146
—
3
Company contributions expected to be made during
the remainder of the year
15
—
33
—
2
—
2
—

(1)The U.S. pension plans include benefits paid directly by the Company for the nonqualified pension plans.
(2)Company contributions are composed of cash contributions made to the plans and benefits paid directly by the Company.












Defined Contribution Plans
The following table summarizes the Company’s contributions for the defined contribution plans:
Three Months Ended September 30,Nine Months Ended 
 September 30,		Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
U.S. plans$95
$89
$293
$281
$90
$95
$293
$293
Non-U.S. plans68
67
203
207
68
68
216
203













Post Employment Plans
The following table summarizes the components of net expense recognized in the Consolidated Statement of Income for the Company’s U.S. post employment plans:
 Three Months Ended September 30,Nine Months Ended 
 September 30,
In millions of dollars2017201620172016
Service-related expense

$—
$—
$—
$—
Interest cost on benefit obligation—
—
1
2
Amortization of unrecognized







     Prior service benefit(8)(7)(23)(23)
     Net actuarial loss1
1
2
3
Total service-related benefit$(7)$(6)$(20)$(18)
Non-service-related expense$9
$10
$21
$23
Total net expense$2
$4
$1
$5
 Three Months Ended September 30,Nine Months Ended 
 September 30,
In millions of dollars2018201720182017
Interest cost on benefit obligation$—
$—
$1
$1
Expected return on plan assets—
—
(1)—
Amortization of unrecognized:







     Prior service
       benefit
(8)(8)(23)(23)
     Net actuarial
       loss
1
1
2
2
Total service-
  related benefit
$(7)$(7)$(21)$(20)
Non-service-
  related expense
$4
$9
$7
$21
Total net
 (benefit) expense

$(3)$2
$(14)$1





















9.   EARNINGS PER SHARE
The following table reconciles the income and share data used in the basic and diluted earnings per share (EPS) computations:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions, except per-share amounts2017201620172016
In millions of dollars, except per share amounts2018201720182017
Income from continuing operations before attribution of noncontrolling interests$4,137
$3,887
$12,138
$11,442
$4,633
$4,137
$13,783
$12,138
Less: Noncontrolling interests from continuing operations(1)17
41
48
3
(1)51
41
Net income from continuing operations (for EPS purposes)$4,138
$3,870
$12,097
$11,394
$4,630
$4,138
$13,732
$12,097
Income (loss) from discontinued operations, net of taxes(5)(30)(2)(55)
Loss from discontinued operations, net of taxes(8)(5)—
(2)
Citigroup's net income$4,133
$3,840
$12,095
$11,339
$4,622
$4,133
$13,732
$12,095
Less: Preferred dividends(1)
272
225
893
757
270
272
860
893
Net income available to common shareholders$3,861
$3,615
$11,202
$10,582
$4,352
$3,861
$12,872
$11,202
Less: Dividends and undistributed earnings allocated to employee restricted and deferred shares with nonforfeitable rights to dividends, applicable to basic EPS53
53
156
145
51
53
151
156
Net income allocated to common shareholders for basic EPS$3,808
$3,562
$11,046
$10,437
$4,301
$3,808
$12,721
$11,046
Net income allocated to common shareholders for diluted EPS3,808
3,562
$11,046
$10,437
4,301
3,808
12,721
11,046
Weighted-average common shares outstanding applicable to basic EPS2,683.6
2,879.9
2,729.3
2,912.9
Weighted-average common shares outstanding applicable to basic EPS (in millions)
2,479.8
2,683.6
2,524.1
2,729.3
Effect of dilutive securities(2)
   
    
 
Options(3)
0.1
0.1
0.1
0.1
0.2
0.1
0.1
0.1
Other employee plans—
0.1
—
0.1
1.4
—
1.3
—
Adjusted weighted-average common shares outstanding applicable to diluted EPS(4)
2,683.7
2,880.1
2,729.5
2,913.0
2,481.4
2,683.7
2,525.5
2,729.5
Basic earnings per share(5)
   
     
 
Income from continuing operations$1.42
$1.25
$4.05
$3.60
$1.74
$1.42
$5.04
$4.05
Discontinued operations—
(0.01)—
(0.02)—
—
—
—
Net income$1.42
$1.24
$4.05
$3.58
$1.73
$1.42
$5.04
$4.05
Diluted earnings per share(5)
         
Income from continuing operations$1.42
$1.25
$4.05
$3.60
$1.74
$1.42
$5.04
$4.05
Discontinued operations—
(0.01)—
(0.02)—
—
—
—
Net income$1.42
$1.24
$4.05
$3.58
$1.73
$1.42
$5.04
$4.05
(1)As of September 30, 2017,2018, Citi estimates it will distribute preferred dividends of approximately $320$313 million during the remainder of 2017,2018, assuming such dividends are declared by the Citi Board of Directors. During the first nine months of 2018, Citi redeemed all of its 3.8 million Series AA preferred shares for $96.8 million and all of its 4.9 million Series E preferred shares for $121.3 million. All preferred shares were redeemed at par value. Citi redeemed all of its 23 million Series C preferred shares for $575 million in October 2018.
(2)Warrants issued to the U.S. Treasury as part of the Troubled Asset Relief Program (TARP) and the loss-sharing agreement (all of which were subsequently sold to the public in January 2011), with exercise prices of $178.50 and $105.27$103.82 per share for approximately 21.0 million and 25.5 million shares of Citigroup common stock, respectively. Both warrants were not included in the computation of earnings per share in the three and nine months ended September 30, 20172018 and 20162017 because they were anti-dilutive.
(3)During the third quarters of 20172018 and 2016,2017, weighted-average options to purchase 0.80.5 million and 3.60.8 million shares of common stock, respectively, were outstanding, but not included in the computation of earnings per share because the weighted-average exercise prices of $206.70$142.30 and $85.92$206.70 per share, respectively, were anti-dilutive.
(4)Due to rounding, common shares outstanding applicable to basic EPS and the effect of dilutive securities may not sum to common shares outstanding applicable to diluted EPS.
(5)Due to rounding, earnings per share on continuing operations and discontinued operations may not sum to earnings per share on net income.



10. FEDERAL FUNDS, SECURITIES BORROWED, LOANED AND SUBJECT TO REPURCHASE AGREEMENTS
For additional information on the Company’s resale and repurchase agreements and securities borrowing and lending agreements, see Note 11 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
Federal funds sold and securities borrowed orand purchased under agreements to resell, at their respective carrying values, consisted of the following:
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2018		December 31, 2017
Federal funds sold$20
$—
$20
$—
Securities purchased under agreements to resell139,203
131,473
152,889
130,984
Deposits paid for securities borrowed113,385
105,340
128,032
101,494
Total(1)
$252,608
$236,813
$280,941
$232,478

Federal funds purchased and securities loaned orand sold under agreements to repurchase, at their respective carrying values, consisted of the following:
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2018		December 31, 2017
Federal funds purchased$388
$178
$117
$326
Securities sold under agreements to repurchase145,280
125,685
161,987
142,646
Deposits received for securities loaned15,614
15,958
13,811
13,305
Total(1)
$161,282
$141,821
$175,915
$156,277
(1)
The above tables do not include securities-for-securities lending transactions of $14.4$19.9 billion and $9.3$14.0 billion at September 30, 20172018 and December 31, 2016,2017, respectively, where the Company acts as lender and receives securities that can be sold or pledged as collateral. In these transactions, the Company recognizes the securities received at fair value within Other assets and the obligation to return those securities as a liability within Brokerage payables.
 

It is the Company’s policy to take possession of the underlying collateral, monitor its market value relative to the amounts due under the agreements and, when necessary, require prompt transfer of additional collateral in order to maintain contractual margin protection. For resale and repurchase agreements, when necessary, the Company posts additional collateral in order to maintain contractual margin protection.
A substantial portion of the resale and repurchase agreements is recorded at fair value, as described in Notes 20 and 21 to the Consolidated Financial Statements. The remaining portion is carried at the amount of cash initially advanced or received, plus accrued interest, as specified in the respective agreements.
A substantial portion of securities borrowing and lending agreements is recorded at the amount of cash advanced or received. The remaining portion is recorded at fair value as the Company elected the fair value option for certain securities borrowed and loaned portfolios, as described in Note 21 to the Consolidated Financial Statements. With respect to securities loaned, the Company receives cash collateral in an amount generally in excess of the market value of the securities loaned. The Company monitors the market value of securities borrowed and securities loaned on a daily basis and obtains or posts additional collateral in order to maintain contractual margin protection.
The following tables present the gross and net resale and repurchase agreements and securities borrowing and lending
agreements and the related offsetting amount permitted under ASC-210-20-45.ASC 210-20-45. The tables also include amounts related to financial instruments that are not permitted to be offset under ASC-210-20-45,ASC 210-20-45, but would be eligible for offsetting to the extent that an event of default occurred and a legal opinion supporting enforceability of the offsetting rights has been obtained. Remaining exposures continue to be secured by financial collateral, but the Company may not have sought or been able to obtain a legal opinion evidencing enforceability of the offsetting right.
As of September 30, 2017As of September 30, 2018
In millions of dollarsGross amounts
of recognized
assets
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
assets included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Gross amounts
of recognized
assets
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
assets included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Securities purchased under agreements to resell$207,485
$68,282
$139,203
$105,439
$33,764
$248,802
$95,913
$152,889
$121,141
$31,748
Deposits paid for securities borrowed113,385
—
113,385
23,136
90,249
128,032
—
128,032
29,461
98,571
Total$320,870
$68,282
$252,588
$128,575
$124,013
$376,834
$95,913
$280,921
$150,602
$130,319



In millions of dollarsGross amounts
of recognized
liabilities
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
liabilities included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Gross amounts
of recognized
liabilities
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
liabilities included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Securities sold under agreements to repurchase$213,562
$68,282
$145,280
$67,974
$77,306
$257,900
$95,913
$161,987
$87,917
$74,070
Deposits received for securities loaned15,614
—
15,614
4,359
11,255
13,811
—
13,811
4,730
9,081
Total$229,176
$68,282
$160,894
$72,333
$88,561
$271,711
$95,913
$175,798
$92,647
$83,151

As of December 31, 2016As of December 31, 2017
In millions of dollarsGross amounts
of recognized
assets
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
assets included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Gross amounts
of recognized
assets
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
assets included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Securities purchased under agreements to resell$176,284
$44,811
$131,473
$102,874
$28,599
$204,460
$73,476
$130,984
$103,022
$27,962
Deposits paid for securities borrowed105,340
—
105,340
16,200
89,140
101,494
—
101,494
22,271
79,223
Total$281,624
$44,811
$236,813
$119,074
$117,739
$305,954
$73,476
$232,478
$125,293
$107,185
In millions of dollarsGross amounts
of recognized
liabilities
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
liabilities included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Gross amounts
of recognized
liabilities
Gross amounts
offset on the
Consolidated
Balance Sheet(1)
Net amounts of
liabilities included on
the Consolidated
Balance Sheet(2)
Amounts
not offset on the
Consolidated Balance
Sheet but eligible for
offsetting upon
counterparty default(3)
Net
amounts(4)
Securities sold under agreements to repurchase$170,496
$44,811
$125,685
$63,517
$62,168
$216,122
$73,476
$142,646
$73,716
$68,930
Deposits received for securities loaned15,958
—
15,958
3,529
12,429
13,305
—
13,305
4,079
9,226
Total$186,454
$44,811
$141,643
$67,046
$74,597
$229,427
$73,476
$155,951
$77,795
$78,156
(1)Includes financial instruments subject to enforceable master netting agreements that are permitted to be offset under ASC 210-20-45.
(2)The total of this column for each period excludes Federalfederal funds sold/purchased. See tables above.
(3)Includes financial instruments subject to enforceable master netting agreements that are not permitted to be offset under ASC 210-20-45, but would be eligible for offsetting to the extent that an event of default has occurred and a legal opinion supporting enforceability of the offsetting right has been obtained.
(4)Remaining exposures continue to be secured by financial collateral, but the Company may not have sought or been able to obtain a legal opinion evidencing enforceability of the offsetting right.

The following tables present the gross amount of liabilities associated with repurchase agreements and securities lending agreements, by remaining contractual maturity:

As of September 30, 2017As of September 30, 2018
In millions of dollarsOpen and overnightUp to 30 days31–90 daysGreater than 90 daysTotalOpen and overnightUp to 30 days31–90 daysGreater than 90 daysTotal
Securities sold under agreements to repurchase$97,624
$54,810
$23,997
$37,131
$213,562
$121,109
$59,246
$30,558
$46,987
$257,900
Deposits received for securities loaned11,980
342
2,070
1,222
15,614
7,091
307
3,200
3,213
13,811
Total$109,604
$55,152
$26,067
$38,353
$229,176
$128,200
$59,553
$33,758
$50,200
$271,711


As of December 31, 2016As of December 31, 2017
In millions of dollarsOpen and overnightUp to 30 days31–90 daysGreater than 90 daysTotalOpen and overnightUp to 30 days31–90 daysGreater than 90 daysTotal
Securities sold under agreements to repurchase$79,740
$50,399
$19,396
$20,961
$170,496
$82,073
$68,372
$33,846
$31,831
$216,122
Deposits received for securities loaned10,813
2,169
2,044
932
15,958
9,946
266
1,912
1,181
13,305
Total$90,553
$52,568
$21,440
$21,893
$186,454
$92,019
$68,638
$35,758
$33,012
$229,427


The following tables present the gross amount of liabilities associated with repurchase agreements and securities lending agreements, by class of underlying collateral:

As of September 30, 2017As of September 30, 2018
In millions of dollarsRepurchase agreementsSecurities lending agreementsTotalRepurchase agreementsSecurities lending agreementsTotal
U.S. Treasury and federal agency securities$67,622
$—
$67,622
$95,116
$110
$95,226
State and municipal securities1,031
5
1,036
2,803
—
2,803
Foreign government securities92,113
221
92,334
94,306
301
94,607
Corporate bonds19,731
472
20,203
22,247
545
22,792
Equity securities11,910
14,301
26,211
18,759
11,982
30,741
Mortgage-backed securities12,590
—
12,590
15,088
—
15,088
Asset-backed securities5,373
—
5,373
6,513
—
6,513
Other3,192
615
3,807
3,068
873
3,941
Total$213,562
$15,614
$229,176
$257,900
$13,811
$271,711

As of December 31, 2016As of December 31, 2017
In millions of dollarsRepurchase agreementsSecurities lending agreementsTotalRepurchase agreementsSecurities lending agreementsTotal
U.S. Treasury and federal agency securities$66,263
$—
$66,263
$58,774
$—
$58,774
State and municipal securities334
—
334
1,605
—
1,605
Foreign government securities52,988
1,390
54,378
89,576
105
89,681
Corporate bonds17,164
630
17,794
20,194
657
20,851
Equity securities12,206
13,913
26,119
20,724
11,907
32,631
Mortgage-backed securities11,421
—
11,421
17,791
—
17,791
Asset-backed securities5,428
—
5,428
5,479
—
5,479
Other4,692
25
4,717
1,979
636
2,615
Total$170,496
$15,958
$186,454
$216,122
$13,305
$229,427



11. BROKERAGE RECEIVABLES AND BROKERAGE
PAYABLES

The Company has receivables and payables for financial instruments sold to and purchased from brokers, dealers and customers, which arise in the ordinary course of business.
For additional information on these receivables and payables, see Note 12 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
Brokerage receivables and Brokerage payables consisted of the following:
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2018		December 31, 2017
Receivables from customers$14,717
$10,374
$15,195
$19,215
Receivables from brokers, dealers, and clearing organizations23,359
18,513
Receivables from brokers, dealers and clearing organizations25,484
19,169
Total brokerage receivables(1)
$38,076
$28,887
$40,679
$38,384
Payables to customers$37,935
$37,237
$41,414
$38,741
Payables to brokers, dealers, and clearing organizations25,270
19,915
Payables to brokers, dealers and clearing organizations31,932
22,601
Total brokerage payables(1)
$63,205
$57,152
$73,346
$61,342

(1)Includes brokerage receivables and payables recorded by Citi broker-dealer entities that are accounted for in accordance with the AICPA Accounting Guide for Brokers and Dealers in Securities as codified in ASC 940-320.


12.   INVESTMENTS

For additional information regarding Citi’s investment portfolios, including evaluating investments for other-than-temporary impairment (OTTI), see Note 13 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.

Overview
Citi adopted ASU 2016-01 and ASU 2018-03 as of January 1, 2018. The ASUs require fair value changes on marketable equity securities to be recognized in earnings. The available-for-sale category was eliminated for equity securities. Also, non-marketable equity securities are required to be measured at fair value with changes in fair value recognized in earnings unless (i) the measurement alternative is elected or (ii) the investment represents Federal Reserve Bank and Federal Home Loan Bank stock or certain exchange seats that continue to be carried at cost. See Note 1 to the Consolidated Financial Statements for additional details.

















The following table presentstables present Citi’s investments by category:
 In millions of dollarsSeptember 30,
2017		December 31,
2016
 
 Securities available-for-sale (AFS)$295,315
$299,424
 
Debt securities held-to-maturity (HTM)(1)
51,527
45,667
 
Non-marketable equity securities carried at fair value(2)
1,300
1,774
 
Non-marketable equity securities carried at cost(3)
6,532
6,439
 Total investments$354,674
$353,304
 In millions of dollarsSeptember 30,
2018
 
 Debt securities available-for-sale (AFS)$284,782
 
Debt securities held-to-maturity (HTM)(1)
53,249
 
Marketable equity securities carried at fair value(2)
260
 
Non-marketable equity securities carried at fair value(2)
1,128
 
Non-marketable equity securities measured using the measurement alternative(3)


452
 
Non-marketable equity securities carried at cost(4)
5,642
 Total investments$345,513

 In millions of dollarsDecember 31,
2017
 
 Securities available-for-sale (AFS)$290,914
 
Debt securities held-to-maturity (HTM)(1)
53,320
 
Non-marketable equity securities carried at fair value(2)
1,206
 
Non-marketable equity securities carried at cost(4)
6,850
 Total investments$352,290
(1)Carried at adjusted amortized cost basis, net of any credit-related impairment.
(2)Unrealized gains and losses for non-marketable equity securities carried at fair value are recognized in earnings.
(3)Primarily consistsImpairment losses and adjustments to the carrying value as a result of observable price changes are recognized in earnings.
(4)Represents shares issued by the Federal Reserve Bank, Federal Home Loan Banks and various clearing housescertain exchanges of which Citigroup is a member.

The following table presents interest and dividend income on investments:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
Taxable interest$1,922
$1,717
$5,545
$5,153
$2,195
$1,922
$6,395
$5,545
Interest exempt from U.S. federal income tax129
135
412
411
130
129
392
412
Dividend income53
35
165
115
63
53
209
165
Total interest and dividend income$2,104
$1,887
$6,122
$5,679
$2,388
$2,104
$6,996
$6,122



The following table presents realized gains and losses on the sales of investments, which excludes OTTI losses:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
Gross realized investment gains$293
$483
$840
$1,105
$153
$293
$550
$840
Gross realized investment losses(80)(196)(214)(432)(84)(80)(209)(214)
Net realized gains on sale of investments$213
$287
$626
$673
$69
$213
$341
$626

 




Securities Available-for-Sale
The amortized cost and fair value of AFS securities were as follows:
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollars
Amortized
cost
Gross
unrealized
gains
Gross
unrealized
losses
Fair
value
Amortized
cost
Gross
unrealized
gains
Gross
unrealized
losses
Fair
value
Amortized
cost
Gross
unrealized
gains
Gross
unrealized
losses
Fair
value
Amortized
cost
Gross
unrealized
gains
Gross
unrealized
losses
Fair
value
Securities AFS      
Mortgage-backed securities(1)
      
U.S. government-sponsored agency guaranteed$42,422
$223
$331
$42,314
$38,663
$248
$506
$38,405
$46,675
$61
$1,575
$45,161
$42,116
$125
$500
$41,741
Prime1
—
—
1
2
—
—
2
—
—
—
—
11
6
—
17
Alt-A—
—
—
—
43
7
—
50
1
—
—
1
26
90
—
116
Non-U.S. residential2,984
16
9
2,991
3,852
13
7
3,858
1,620
7
1
1,626
2,744
13
6
2,751
Commercial345
1
2
344
357
2
1
358
233
1
3
231
334
—
2
332
Total mortgage-backed securities$45,752
$240
$342
$45,650
$42,917
$270
$514
$42,673
$48,529
$69
$1,579
$47,019
$45,231
$234
$508
$44,957
U.S. Treasury and federal agency securities       
U.S. Treasury$107,696
$283
$408
$107,571
$113,606
$629
$452
$113,783
$108,509
$28
$1,949
$106,588
$108,344
$77
$971
$107,450
Agency obligations10,803
17
65
10,755
9,952
21
85
9,888
9,752
—
197
9,555
10,813
7
124
10,696
Total U.S. Treasury and federal agency securities$118,499
$300
$473
$118,326
$123,558
$650
$537
$123,671
$118,261
$28
$2,146
$116,143
$119,157
$84
$1,095
$118,146
State and municipal(2)
$9,335
$146
$291
$9,190
$10,797
$80
$757
$10,120
$9,662
$87
$269
$9,480
$8,870
$140
$245
$8,765
Foreign government100,625
526
404
100,747
98,112
590
554
98,148
94,937
293
769
94,461
100,615
508
590
100,533
Corporate15,459
82
82
15,459
17,195
105
176
17,124
12,498
21
139
12,380
14,144
51
86
14,109
Asset-backed securities(1)
5,279
15
3
5,291
6,810
6
22
6,794
1,265
3
6
1,262
3,906
14
2
3,918
Other debt securities348
—
—
348
503
—
—
503
4,036
1
—
4,037
297
—
—
297
Total debt securities AFS$295,297
$1,309
$1,595
$295,011
$299,892
$1,701
$2,560
$299,033
$289,188
$502
$4,908
$284,782
$292,220
$1,031
$2,526
$290,725
Marketable equity securities AFS(3)$284
$23
$3
$304
$377
$20
$6
$391
$—
$—
$—
$—
$186
$4
$1
$189
Total securities AFS$295,581
$1,332
$1,598
$295,315
$300,269
$1,721
$2,566
$299,424
$289,188
$502
$4,908
$284,782
$292,406
$1,035
$2,527
$290,914
(1)The Company invests in mortgage-backed and asset-backed securities. These securitizations are generally considered VIEs. The Company’s maximum exposure to loss from these VIEs is equal to the carrying amount of the securities, which is reflected in the table above. For mortgage-backed and asset-backed securitizations in which the Company has other involvement, see Note 18 to the Consolidated Financial Statements.
(2)
In the second quarter of 2017, Citi early adopted ASU 2017-08, Receivables-NonrefundableReceivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. Upon adoption, a cumulative effect adjustment was recorded to reduce retainedRetained earnings, effective January 1, 2017, for the incremental amortization of purchase premiums and cumulative fair value hedge adjustments on callable state and municipal debt securities. For additional information, see Note 1 to the Consolidated Financial Statements.











(3)
Citi adopted ASU 2016-01 and ASU 2018-03 as of January 1, 2018, resulting in a cumulative effect adjustment from AOCI to Retained earnings for net unrealized gains on marketable equity securities AFS. The available-for-sale category was eliminated for equity securities effective January 1, 2018. See Note 1 to the Consolidated Financial Statements for additional details.


The following table shows the fair value of AFS securities that have been in an unrealized loss position:
Less than 12 months12 months or longerTotalLess than 12 months12 months or longerTotal
In millions of dollars
Fair
value
Gross
unrealized
losses
Fair
value
Gross
unrealized
losses
Fair
value
Gross
unrealized
losses
Fair
value
Gross
unrealized
losses
Fair
value
Gross
unrealized
losses
Fair
value
Gross
unrealized
losses
September 30, 2017   
September 30, 2018   
Debt Securities AFS(1)
   
Mortgage-backed securities   
U.S. government-sponsored agency guaranteed$21,723
$574
$18,828
$1,001
$40,551
$1,575
Non-U.S. residential256
1
1
—
257
1
Commercial168
2
51
1
219
3
Total mortgage-backed securities$22,147
$577
$18,880
$1,002
$41,027
$1,579
U.S. Treasury and federal agency securities   
U.S. Treasury$27,095
$279
$65,789
$1,670
$92,884
$1,949
Agency obligations1,549
15
8,004
182
9,553
197
Total U.S. Treasury and federal agency securities$28,644
$294
$73,793
$1,852
$102,437
$2,146
State and municipal$1,811
$48
$1,260
$221
$3,071
$269
Foreign government48,491
463
11,598
306
60,089
769
Corporate6,556
114
798
25
7,354
139
Asset-backed securities604
6
27
—
631
6
Other debt securities1,313
—
—
—
1,313
—
Total debt securities AFS$109,566
$1,502
$106,356
$3,406
$215,922
$4,908
December 31, 2017 
 
 
 
 
 
Securities AFS    
 
 
 
 
 
Mortgage-backed securities    
 
 
 
 
 
U.S. government-sponsored agency guaranteed$24,545
$275
$2,631
$56
$27,176
$331
$30,994
$438
$2,206
$62
$33,200
$500
Non-U.S. residential1,267
8
28
1
1,295
9
753
6
—
—
753
6
Commercial111
1
42
1
153
2
150
1
57
1
207
2
Total mortgage-backed securities$25,923
$284
$2,701
$58
$28,624
$342
$31,897
$445
$2,263
$63
$34,160
$508
U.S. Treasury and federal agency securities    
 
 
 
 
 
U.S. Treasury$50,362
$367
$4,392
$41
$54,754
$408
$79,050
$856
$7,404
$115
$86,454
$971
Agency obligations6,884
46
1,231
19
8,115
65
8,857
110
1,163
14
10,020
124
Total U.S. Treasury and federal agency securities$57,246
$413
$5,623
$60
$62,869
$473
$87,907
$966
$8,567
$129
$96,474
$1,095
State and municipal$430
$13
$1,669
$278
$2,099
$291
$1,009
$11
$1,155
$234
$2,164
$245
Foreign government40,112
202
9,462
202
49,574
404
53,206
356
9,051
234
62,257
590
Corporate6,330
65
696
17
7,026
82
6,737
74
859
12
7,596
86
Asset-backed securities1,148
3
207
—
1,355
3
449
1
25
1
474
2
Other debt securities—
—
—
—
—
—
—
—
—
—
—
—
Marketable equity securities AFS13
2
11
1
24
3
Marketable equity securities AFS(1)
11
1
—
—
11
1
Total securities AFS$131,202
$982
$20,369
$616
$151,571
$1,598
$181,216
$1,854
$21,920
$673
$203,136
$2,527
December 31, 2016 
 
 
 
 
 
Securities AFS 
 
 
 
 
 
Mortgage-backed securities 
 
 
 
 
 
U.S. government-sponsored agency guaranteed$23,534
$436
$2,236
$70
$25,770
$506
Prime1
—
—
—
1
—
Non-U.S. residential486
—
1,276
7
1,762
7
Commercial75
1
58
—
133
1
Total mortgage-backed securities$24,096
$437
$3,570
$77
$27,666
$514
U.S. Treasury and federal agency securities 
 
 
 
 
 
U.S. Treasury$44,342
$445
$1,335
$7
$45,677
$452
Agency obligations6,552
83
250
2
6,802
85
Total U.S. Treasury and federal agency securities$50,894
$528
$1,585
$9
$52,479
$537
State and municipal$1,616
$55
$3,116
$702
$4,732
$757
Foreign government38,226
243
8,973
311
47,199
554
Corporate7,011
129
1,877
47
8,888
176
Asset-backed securities411
—
3,213
22
3,624
22
Other debt securities5
—
—
—
5
—
Marketable equity securities AFS19
2
24
4
43
6
Total securities AFS$122,278
$1,394
$22,358
$1,172
$144,636
$2,566

(1)Citi adopted ASU 2016-01 and ASU 2018-03 as of January 1, 2018, resulting in a cumulative effect adjustment from AOCI to retained earnings for net unrealized gains on marketable equity securities AFS. The available-for-sale category was eliminated for equity securities effective January 1, 2018. See Note 1 to the Consolidated Financial Statements for additional details.



The following table presents the amortized cost and fair value of AFS debt securities by contractual maturity dates:
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollars
Amortized
cost
Fair
value
Amortized
cost
Fair
value
Amortized
cost
Fair
value
Amortized
cost
Fair
value
Mortgage-backed securities(1)
      
Due within 1 year$61
$61
$132
$132
$434
$431
$45
$45
After 1 but within 5 years1,340
1,340
736
738
1,201
1,194
1,306
1,304
After 5 but within 10 years1,469
1,466
2,279
2,265
2,159
2,119
1,376
1,369
After 10 years(2)
42,882
42,783
39,770
39,538
44,735
43,275
42,504
42,239
Total$45,752
$45,650
$42,917
$42,673
$48,529
$47,019
$45,231
$44,957
U.S. Treasury and federal agency securities      
Due within 1 year$3,549
$3,539
$4,945
$4,945
$34,543
$34,471
$4,913
$4,907
After 1 but within 5 years109,477
109,286
101,369
101,323
81,735
79,739
111,236
110,238
After 5 but within 10 years5,473
5,501
17,153
17,314
1,893
1,842
3,008
3,001
After 10 years(2)
—
—
91
89
90
91
—
—
Total$118,499
$118,326
$123,558
$123,671
$118,261
$116,143
$119,157
$118,146
State and municipal      
Due within 1 year$2,036
$2,036
$2,093
$2,092
$2,773
$2,772
$1,792
$1,792
After 1 but within 5 years2,412
2,416
2,668
2,662
1,575
1,570
2,579
2,576
After 5 but within 10 years493
508
335
334
572
590
514
528
After 10 years(2)
4,394
4,230
5,701
5,032
4,742
4,548
3,985
3,869
Total$9,335
$9,190
$10,797
$10,120
$9,662
$9,480
$8,870
$8,765
Foreign government       
Due within 1 year$32,095
$32,097
$32,540
$32,547
$34,686
$34,649
$32,130
$32,100
After 1 but within 5 years52,519
52,362
51,008
50,881
47,933
47,416
53,034
53,165
After 5 but within 10 years13,531
13,690
12,388
12,440
10,371
10,386
12,949
12,680
After 10 years(2)
2,480
2,598
2,176
2,280
1,947
2,010
2,502
2,588
Total$100,625
$100,747
$98,112
$98,148
$94,937
$94,461
$100,615
$100,533
All other(3)
       
Due within 1 year$3,585
$3,583
$2,629
$2,628
$6,439
$6,435
$3,998
$3,991
After 1 but within 5 years9,799
9,818
12,339
12,334
9,151
9,068
9,047
9,027
After 5 but within 10 years5,581
5,585
6,566
6,528
1,614
1,603
3,415
3,431
After 10 years(2)
2,121
2,112
2,974
2,931
595
573
1,887
1,875
Total$21,086
$21,098
$24,508
$24,421
$17,799
$17,679
$18,347
$18,324
Total debt securities AFS$295,297
$295,011
$299,892
$299,033
$289,188
$284,782
$292,220
$290,725
(1)Includes mortgage-backed securities of U.S. government-sponsored agencies.
(2)Investments with no stated maturities are included as contractual maturities of greater than 10 years. Actual maturities may differ due to call or prepayment rights.
(3)Includes corporate, asset-backed and other debt securities.



Debt Securities Held-to-Maturity

The carrying value and fair value of debt securities HTM were as follows:
In millions of dollars
Amortized
cost basis(1)
Net unrealized gains
(losses)
recognized in
AOCI
Carrying
value(2)
Gross
unrealized
gains
Gross
unrealized
(losses)
Fair
value
Carrying
value
Gross
unrealized
gains
Gross
unrealized
losses
Fair
value
September 30, 2017    
September 30, 2018   
Debt securities held-to-maturity        
Mortgage-backed securities(3)
     
Mortgage-backed securities(1)
   
U.S. government agency guaranteed$23,683
$26
$23,709
$104
$(78)$23,735
$25,058
$3
$869
$24,192
Prime13
—
13
4
—
17
Alt-A256
(11)245
97
—
342
Non-U.S. residential1,932
(47)1,885
58
—
1,943
Commercial217
—
217
—
—
217
Total mortgage-backed securities$26,101
$(32)$26,069
$263
$(78)$26,254
State and municipal(4)
$8,588
$(30)$8,558
$338
$(90)$8,806
Foreign government584
—
584
—
(14)570
Asset-backed securities(3)
16,286
(5)16,281
94
(10)16,365
Other debt securities35
—
35
—
—
35
Total debt securities held-to-maturity$51,594
$(67)$51,527
$695
$(192)$52,030
December 31, 2016  
 
 
 
 
Debt securities held-to-maturity 
 
 
 
 
 
Mortgage-backed securities(3)
 
 
 
 
 
 
U.S. government agency guaranteed$22,462
$33
$22,495
$47
$(186)$22,356
Prime31
(7)24
10
(1)33
Alt-A314
(27)287
69
(1)355
—
—
—
—
Non-U.S. residential1,871
(47)1,824
49
—
1,873
1,288
19
—
1,307
Commercial14
—
14
—
—
14
260
—
—
260
Total mortgage-backed securities$24,692
$(48)$24,644
$175
$(188)$24,631
$26,606
$22
$869
$25,759
State and municipal$9,025
$(442)$8,583
$129
$(238)$8,474
$7,399
$124
$185
$7,338
Foreign government1,339
—
1,339
—
(26)1,313
1,151
—
14
1,137
Asset-backed securities(3)
11,107
(6)11,101
41
(5)11,137
Total debt securities held-to-maturity(5)
$46,163
$(496)$45,667
$345
$(457)$45,555
Asset-backed securities(1)
18,093
27
11
18,109
Total debt securities held-to-maturity$53,249
$173
$1,079
$52,343
December 31, 2017 
 
 
 
Debt securities held-to-maturity 
 
 
 
Mortgage-backed securities(1)
 
 
 
 
U.S. government agency guaranteed$23,880
$40
$157
$23,763
Alt-A141
57
—
198
Non-U.S. residential1,841
65
—
1,906
Commercial237
—
—
237
Total mortgage-backed securities$26,099
$162
$157
$26,104
State and municipal (2)
$8,897
$378
$73
$9,202
Foreign government740
—
18
722
Asset-backed securities(1)
17,584
162
22
17,724
Total debt securities held-to-maturity$53,320
$702
$270
$53,752
(1)
For securities transferred to HTM from Trading account assets, amortized cost basis is defined as the fair value of the securities at the date of transfer plus any accretion income and less any impairments recognized in earnings subsequent to transfer. For securities transferred to HTM from AFS, amortized cost is defined as the original purchase cost, adjusted for the cumulative accretion or amortization of any purchase discount or premium, plus or minus any cumulative fair value hedge adjustments, net of accretion or amortization, and less any other-than-temporary impairment recognized in earnings.
(2)HTM securities are carried on the Consolidated Balance Sheet at amortized cost basis, plus or minus any unamortized unrealized gains and losses and fair value hedge adjustments recognized in AOCI prior to reclassifying the securities from AFS to HTM. Changes in the values of these securities are not reported in the financial statements, except for the amortization of any difference between the carrying value at the transfer date and par value of the securities, and the recognition of any non-credit fair value adjustments in AOCI in connection with the recognition of any credit impairment in earnings related to securities the Company continues to intend to hold until maturity.
(3)The Company invests in mortgage-backed and asset-backed securities. These securitizations are generally considered VIEs. The Company’s maximum exposure to loss from these VIEs is equal to the carrying amount of the securities, which is reflected in the table above. For mortgage-backed and asset-backed securitizations in which the Company has other involvement, see Note 18 to the Consolidated Financial Statements.
(4)(2)
In the second quarter of 2017, Citi early adopted ASU 2017-08, Receivables-NonrefundableReceivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. Upon adoption, a cumulative effect adjustment was recorded to reduce retained earnings, effective January 1, 2017, for the incremental amortization of purchase premiums and cumulative fair value hedge adjustments on callable state and municipal debt securities. For additional information, see Note 1 to the Consolidated Financial Statements.
(5)During the fourth quarter of 2016, securities with a total fair value of approximately $5.8 billion were transferred from AFS to HTM, composed of $5 billion of U.S. government agency mortgage-backed securities and $830 million of municipal securities. The transfer reflects the Company’s intent to hold these securities to maturity or to issuer call, in part, in order to reduce the impact of price volatility on AOCI and certain capital measures under Basel III. While these securities were transferred to HTM at fair value as of the transfer date, no subsequent changes in value may be recorded, other than in connection with the recognition of any subsequent other-than-temporary impairment and the amortization of differences between the carrying values at the transfer date and the par values of each security as an adjustment of yield over the remaining contractual life of each security. Any net unrealized holding losses within AOCI related to the respective securities at the


date of transfer, inclusive of any cumulative fair value hedge adjustments, will be amortized over the remaining contractual life of each security as an adjustment of yield in a manner consistent with the amortization of any premium or discount.
















The table below shows the fair value of debt securities HTM that have been in an unrecognized loss position:
Less than 12 months12 months or longerTotalLess than 12 months12 months or longerTotal
In millions of dollarsFair
value		Gross
unrecognized
losses		Fair
value		Gross
unrecognized
losses		Fair
value		Gross
unrecognized
losses		Fair
value		Gross
unrecognized
losses		Fair
value		Gross
unrecognized
losses		Fair
value		Gross
unrecognized
losses
September 30, 2017     
September 30, 2018     
Debt securities held-to-maturity          
Mortgage-backed securities$47
$—
$10,147
$78
$10,194
$78
$13,815
$392
$9,815
$477
$23,630
$869
State and municipal242
6
832
84
1,074
90
2,283
58
799
127
3,082
185
Foreign government570
14
—
—
570
14
1,138
14
—
—
1,138
14
Asset-backed securities55
2
2,563
8
2,618
10
3,670
11
2
—
3,672
11
Total debt securities held-to-maturity$914
$22
$13,542
$170
$14,456
$192
$20,906
$475
$10,616
$604
$31,522
$1,079
December 31, 2016     
December 31, 2017     
Debt securities held-to-maturity          
Mortgage-backed securities$17
$—
$17,176
$188
$17,193
$188
$8,569
$50
$6,353
$107
$14,922
$157
State and municipal2,200
58
1,210
180
3,410
238
353
5
835
68
1,188
73
Foreign government1,313
26
—
—
1,313
26
723
18
—
—
723
18
Asset-backed securities2
—
2,503
5
2,505
5
71
3
134
19
205
22
Total debt securities held-to-maturity$3,532
$84
$20,889
$373
$24,421
$457
$9,716
$76
$7,322
$194
$17,038
$270
Note: Excluded from the gross unrecognized losses presented in the table above are $(67)$(65) million and $(496)$(117) million of net unrealized losses recorded in AOCI as of September 30, 20172018 and December 31, 2016,2017, respectively, primarily related to the difference between the amortized cost and carrying value of HTM debt securities that were reclassified from AFS. Substantially all of these net unrecognized losses relate to securities that have been in a loss position for 12 months or longer at September 30, 20172018 and December 31, 2016.2017.


The following table presents the carrying value and fair value of HTM debt securities by contractual maturity dates:
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollarsCarrying valueFair valueCarrying valueFair valueCarrying valueFair valueCarrying valueFair value
Mortgage-backed securities      
Due within 1 year$—
$—
$—
$—
$—
$—
$—
$—
After 1 but within 5 years737
743
760
766
129
127
720
720
After 5 but within 10 years123
124
54
55
101
99
148
149
After 10 years(1)
25,209
25,387
23,830
23,810
26,376
25,533
25,231
25,235
Total$26,069
$26,254
$24,644
$24,631
$26,606
$25,759
$26,099
$26,104
State and municipal      
Due within 1 year$227
$228
$406
$406
$31
$31
$407
$425
After 1 but within 5 years166
176
112
110
131
133
259
270
After 5 but within 10 years458
474
363
367
492
495
512
524
After 10 years(1)
7,707
7,928
7,702
7,591
6,745
6,679
7,719
7,983
Total$8,558
$8,806
$8,583
$8,474
$7,399
$7,338
$8,897
$9,202
Foreign government      
Due within 1 year$413
$413
$824
$818
$114
$114
$381
$381
After 1 but within 5 years171
157
515
495
1,037
1,023
359
341
After 5 but within 10 years—
—
—
—
—
—
—
—
After 10 years(1)
—
—
—
—
—
—
—
—
Total$584
$570
$1,339
$1,313
$1,151
$1,137
$740
$722
All other(2)
      
Due within 1 year$—
$—
$—
$—
$—
$—
$—
$—
After 1 but within 5 years35
35
—
—
—
—
—
—
After 5 but within 10 years1,146
1,148
513
514
2,244
2,250
1,669
1,680
After 10 years(1)
15,135
15,217
10,588
10,623
15,849
15,859
15,915
16,044
Total$16,316
$16,400
$11,101
$11,137
$18,093
$18,109
$17,584
$17,724
Total debt securities held-to-maturity$51,527
$52,030
$45,667
$45,555
$53,249
$52,343
$53,320
$53,752
(1)Investments with no stated maturities are included as contractual maturities of greater than 10 years. Actual maturities may differ due to call or prepayment rights.
(2)Includes corporate and asset-backed securities.




Evaluating Investments for Other-Than-Temporary Impairment

Overview
The Company conducts periodic reviews of all securities with unrealized losses to evaluate whether the impairment is other-than-temporary. This review applies to all securities that are not measured at fair value through earnings. Effective January 1, 2018, the AFS category was eliminated for equity securities and, therefore, other-than-temporary impairment (OTTI) review is not required for those securities. See Note 1 to the Consolidated Financial Statements for additional details.
An unrealized loss exists when the current fair value of an individual security is less than its amortized cost basis. Unrealized losses that are determined to be temporary in nature are recorded, net of tax, in AOCI for AFS securities. LossesTemporary losses related to HTM debt securities generally are not recorded, as these investments are carried at adjusted amortized cost basis. However, for HTM debt securities with credit-related impairment, the credit loss is recognized in earnings as OTTI, and any difference between the cost basis adjusted for the OTTI and fair value is recognized in AOCI and amortized as an adjustment of yield over the remaining contractual life of the security. For debt securities transferred to HTM from Trading account assets, amortized cost is defined as the fair value of the securities at the date of transfer, plus any accretion income and less any impairment recognized in earnings subsequent to transfer. For debt securities transferred to HTM from AFS, amortized cost is defined as the original purchase cost, adjusted for the cumulative accretion or amortization of any purchase discount or premium, plus or minus any cumulative fair value hedge adjustments, net of accretion or amortization, and less any impairment recognized in earnings.
Regardless of the classification of the securities as AFS or HTM, the Company assesses each position with an unrealized loss for OTTI. Factors considered in determining whether a loss is temporary include:

the length of time and the extent to which fair value has been below cost;
the severity of the impairment;
the cause of the impairment and the financial condition and near-term prospects of the issuer;
activity in the market of the issuer that may indicate adverse credit conditions; and
the Company’s ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery.

The Company’s review for impairment generally entails:

identification and evaluation of impaired investments;
analysis of individual investments that have fair values less than amortized cost, including consideration of the length of time the investment has been in an unrealized loss position and the expected recovery period;
consideration of evidential matter, including an evaluation of factors or triggers that could cause individual investments to qualify as having other-than-temporary
impairment and those that would not support other-than-temporary impairment; and
documentation of the results of these analyses, as required under business policies.

Debt Securities
The entire difference between amortized cost basis and fair value is recognized in earnings as OTTI for impaired debt securities that the Company has an intent to sell or for which the Company believes it will more-likely-than-not be required to sell prior to recovery of the amortized cost basis. However, for those securities that the Company does not intend to sell and is not likely to be required to sell, only the credit-related impairment is recognized in earnings and any non-credit-related impairment is recorded in AOCI.
For debt securities, credit impairment exists where management does not expect to receive contractual principal and interest cash flows sufficient to recover the entire amortized cost basis of a security.

AFS Equity Securities and Equity Method Investments
For AFS equity securities, prior to January 1, 2018, management considersconsidered the various factors described above, including its intent and ability to hold thean equity security for a period of time sufficient for recovery to cost or whether it iswas more-likely-than-not that the Company will bewould have been required to sell the security prior to recovery of its cost basis. Where management lackslacked that intent or ability, the security’s decline in fair value iswas deemed to be other-than-temporary and iswas recorded in earnings. Effective January 1, 2018, the AFS category has been eliminated for equity securities deemedand, therefore, OTTI review is not required for those securities. See Note 1 to be other-than-temporarily impaired are written down to fair value, with the full difference between fair value and cost recognized in earnings.Consolidated Financial Statements for additional details.
Management assesses equity method investments that have fair values that are less than their respective carrying values for OTTI. Fair value is measured as price multiplied by quantity if the investee has publicly listed securities. If the investee is not publicly listed, other methods are used (see Note 2220 to the Consolidated Financial Statements).
For impaired equity method investments that Citi plans to sell prior to recovery of value or would likely be required to sell, with no expectation that the fair value will recover prior to the expected sale date, the full impairment is recognized in earnings as OTTI regardless of severity and duration. The measurement of the OTTI does not include partial projected recoveries subsequent to the balance sheet date.
For impaired equity method investments that management does not plan to sell and is not likely to be required to sell prior to recovery of value, the evaluation of whether an impairment is other-than-temporary is based on (i) whether and when an equity method investment will recover in value and (ii) whether the investor has the intent and ability to hold that investment for a period of time sufficient to recover the value. The determination of whether the impairment is considered other-than-temporary considers the following indicators, regardless of the time and extent of impairment:indicators:

the cause of the impairment and the financial condition and near-term prospects of the issuer, including any


specific events that may influence the operations of the issuer;
the intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value; and
the length of time and extent to which fair value has been less than the carrying value.


The sections below describe the Company’s process for identifying credit-related impairments for security types that have the most significant unrealized losses as of September 30, 2017.2018.

Mortgage-Backed Securities
For U.S. mortgage-backed securities, (and in particular for Alt-A and other mortgage-backed securities that have significant unrealized losses as a percentage of amortized cost), credit impairment is assessed using a cash flow model that estimates the principal and interest cash flows on the underlying mortgages using the security-specific collateral and transaction structure. The model distributes the estimated cash flows to the various tranches of securities, considering the transaction structure and any subordination and credit enhancements that exist in that structure. The cash flow model incorporates actual cash flows on the mortgage-backed securities through the current period and then estimates the remaining cash flows using a number of assumptions, including default rates, prepayment rates, recovery rates (on foreclosed properties) and loss severity rates (on non-agency mortgage-backed securities).
Management develops specific assumptions using market data, internal estimates and estimates published by rating agencies and other third-party sources. Default rates are projected by considering current underlying mortgage loan performance, generally assuming the default of (i) 10% of current loans, (ii) 25% of 30–59 day delinquent loans,
(iii) 70% of 60–90 day delinquent loans and (iv) 100% of 91+ day delinquent loans. These estimates are extrapolated along a default timing curve to estimate the total lifetime pool default
rate. Other assumptions contemplate the actual collateral attributes, including geographic concentrations, rating actions and current market prices.
Cash flow projections are developed using different stress test scenarios. Management evaluates the results of those stress tests (including the severity of any cash shortfall indicated and the likelihood of the stress scenarios actually occurring based on the underlying pool’s characteristics and performance) to assess whether management expects to recover the amortized cost basis of the security. If cash flow projections indicate that the Company does not expect to recover its amortized cost basis, the Company recognizes the estimated credit loss in earnings.

State and Municipal Securities
The process for identifying credit impairments in Citigroup’s AFS and HTM state and municipal bonds is primarily based on a credit analysis that incorporates third-party credit ratings.  Citigroup monitors the bond issuers and any insurers providing default protection in the form of financial guarantee insurance. The average external credit rating, ignoring any insurance, is Aa3/AA-.  In the event of an external rating downgrade or other indicator of credit impairment (i.e., based on instrument-specific estimates of cash flows or probability of issuer default), the subject bond is specifically reviewed for adverse changes in the amount or timing of expected contractual principal and interest payments.
For state and municipal bonds with unrealized losses that Citigroup plans to sell, or would be more-likely-than-not required to sell, the full impairment is recognized in earnings.

Recognition and Measurement of OTTI
The following tables present total OTTI recognized in earnings:
OTTI on Investments and Other assetsThree Months Ended 
 September 30, 2017		Nine Months Ended  
  September 30, 2017
In millions of dollars
AFS(1)
HTMOther
assets		Total
AFS(1)
HTM
Other
Assets
Total
Impairment losses related to securities that the Company does not intend to sell nor will likely be required to sell:        
Total OTTI losses recognized during the period$2
$—
$—
$2
$2
$—
$—
$2
Less: portion of impairment loss recognized in AOCI (before taxes)—
—
—
—
—
—
—
—
Net impairment losses recognized in earnings for securities that the Company does not intend to sell nor will likely be required to sell$2
$—
$—
$2
$2
$—
$—
$2
Impairment losses recognized in earnings for securities that the Company intends to sell, would be more likely than not required to sell or will be subject to an issuer call deemed probable of exercise12
1
—
13
43
2
—
45
Total impairment losses recognized in earnings$14
$1
$—
$15
$45
$2
$—
$47
OTTI on InvestmentsThree Months Ended 
 September 30, 2018		Nine Months Ended  
  September 30, 2018
In millions of dollars
AFS(1)
HTMTotal
AFS(1)
HTMTotal
Impairment losses related to debt securities that the Company does not intend to sell nor will likely be required to sell:      
Total OTTI losses recognized during the period$—
$—
$—
$—
$—
$—
Less: portion of impairment loss recognized in AOCI (before taxes)—
—
—
—
—
—
Net impairment losses recognized in earnings for debt securities that the Company does not intend to sell nor will likely be required to sell$—
$—
$—
$—
$—
$—
Impairment losses recognized in earnings for debt securities that the Company intends to sell, would be more-likely-than-not required to sell or will be subject to an issuer call deemed probable of exercise70
—
70
109
—
109
Total OTTI losses recognized in earnings$70
$—
$70
$109
$—
$109
(1)Includes OTTI on non-marketableFor the three and nine months ended September 30, 2018, amounts represent AFS debt securities. Effective January 1, 2018, the AFS category was eliminated for equity securities. See Note 1 to the Consolidated Financial Statements for additional details.






OTTI on Investments and Other assetsThree months ended 
  September 30, 2016		Nine Months Ended 
  September 30, 2016
OTTI on InvestmentsThree Months Ended 
  September 30, 2017		Nine Months Ended 
  September 30, 2017
In millions of dollars
AFS(1)
HTMOther
assets		Total
AFS(1)(2)
HTM
Other
assets(3)
Total
AFS (1)
HTMTotal
AFS(1)
HTMTotal
Impairment losses related to securities that the Company does not intend to sell nor will likely be required to sell:         
Total OTTI losses recognized during the period$—
$—
$—
$—
$3
$1
$—
$4
$2
$—
$2
$2
$—
$2
Less: portion of impairment loss recognized in AOCI (before taxes)—
—
—
—
—
—
—
—
—
—
—
—
—
—
Net impairment losses recognized in earnings for securities that the Company does not intend to sell nor will likely be required to sell$—
$—
$—
$—
$3
$1
$—
$4
$2
$—
$2
$2
$—
$2
Impairment losses recognized in earnings for securities that the Company intends to sell, would be more likely than not required to sell or will be subject to an issuer call deemed probable of exercise and FX losses20
12
—
32
243
36
332
611
Impairment losses recognized in earnings for securities that the Company intends to sell, would be more-likely-than-not required to sell or will be subject to an issuer call deemed probable of exercise and FX losses12
1
13
43
2
45
Total impairment losses recognized in earnings$20
$12
$—
$32
$246
$37
$332
$615
$14
$1
$15
$45
$2
$47

(1)Includes OTTI on non-marketable equity securities.
(2)Includes a $160 million impairment related to AFS securities affected by changes in the Venezuela exchange rate during the nine months ended September 30, 2016.
(3)The impairment charge is related to the carrying value of an equity investment.

The following are three-month rollforwards of the credit-related impairments recognized in earnings for AFS and HTM debt securities held that the Company does not intend to sell nor likely will be required to sell:

Cumulative OTTI credit losses recognized in earnings on securities still heldCumulative OTTI credit losses recognized in earnings on debt securities still held
In millions of dollarsJun. 30, 2017 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Reductions due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2017 balanceJune 30, 2018 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Changes due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2018 balance
AFS debt securities      
Mortgage-backed securities(1)$—
$—
$—
$—
$—
$1
$—
$—
$—
$1
State and municipal4
—
—
—
4
—
—
—
—
—
Foreign government securities—
—
—
—
—
—
—
—
—
—
Corporate4
—
—
—
4
4
—
—
—
4
All other debt securities—
—
2
—
2
2
—
—
—
2
Total OTTI credit losses recognized for AFS debt securities$8
$—
$2
$—
$10
$7
$—
$—
$—
$7
HTM debt securities        
Mortgage-backed securities(1)
$97
$—
$—
$—
$97
$—
$—
$—
$—
$—
State and municipal3
—
—
—
3
—
—
—
—
—
Total OTTI credit losses recognized for HTM debt securities$100
$—
$—
$—
$100
$—
$—
$—
$—
$—
(1)Primarily consists of Alt-APrime securities.



Cumulative OTTI credit losses recognized in earnings on securities still heldCumulative OTTI credit losses recognized in earnings on debt securities still held
In millions of dollarsJun. 30, 2016 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Reductions due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2016 balanceJune 30, 2017 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Reductions due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2017 balance
AFS debt securities      
Mortgage-backed securities$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
State and municipal4
—
—
—
4
4
—
—
—
4
Foreign government securities5
—
—
(5)—
—
—
—
—
—
Corporate7
—
—
(1)6
4
—
—
—
4
All other debt securities43
—
—
(20)23
—
—
2
—
2
Total OTTI credit losses recognized for AFS debt securities$59
$—
$—
$(26)$33
$8
$—
$2
$—
$10
HTM debt securities        
Mortgage-backed securities(1)
$108
$—
$—
$(2)$106
$97
$—
$—
$—
$97
State and municipal4
—
—
—
4
3
—
—
—
3
Total OTTI credit losses recognized for HTM debt securities$112
$—
$—
$(2)$110
$100
$—
$—
$—
$100
(1)Primarily consists of Alt-A securities.

The following tables are nine-month rollforwards of the credit-related impairments recognized in earnings for AFS and HTM debt securities held that the Company does not intend to sell nor likely will be required to sell:

Cumulative OTTI credit losses recognized in earnings on securities still heldCumulative OTTI credit losses recognized in earnings on debt securities still held
In millions of dollarsDec. 31, 2016 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Reductions due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2017 balanceDecember 31, 2017 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired
Changes due to
credit-impaired
securities sold,
transferred or
matured(1)
September 30, 2018 balance
AFS debt securities      
Mortgage-backed securities(2)$—
$—
$—
$—
$—
$38
$—
$—
$(37)$1
State and municipal4
—
—
—
4
4
—
—
(4)—
Foreign government securities—
—
—
—
—
—
—
—
—
—
Corporate5
—
—
(1)4
4
—
—
—
4
All other debt securities22
—
2
(22)2
2
—
—
—
2
Total OTTI credit losses recognized for AFS debt securities$31
$—
$2
$(23)$10
$48
$—
$—
$(41)$7
HTM debt securities        
Mortgage-backed securities(1)(3)
$101
$—
$—
$(4)$97
$54
$—
$—
$(54)$—
State and municipal3
—
—
—
3
3
—
—
(3)—
Total OTTI credit losses recognized for HTM debt securities$104
$—
$—
$(4)$100
$57
$—
$—
$(57)$—
(1)
Includes $18 million in cumulative OTTI reclassified from HTM to AFS due to the transfer of the related debt securities from HTM to AFS. Citi adopted ASU 2017-12, Targeted Improvements to Accounting for Hedge Activities, on January 1, 2018 and transferred approximately $4 billion of HTM debt securities into AFS classification as permitted as a one-time transfer under the standard.
(2)Primarily consists of Prime securities.
(3)Primarily consists of Alt-A securities.



Cumulative OTTI credit losses recognized in earnings on securities still heldCumulative OTTI credit losses recognized in earnings on debt securities still held
In millions of dollarsDec. 31, 2015 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Reductions due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2016 balanceDecember 31, 2016 balanceCredit
impairments
recognized in
earnings on
securities not
previously
impaired		Credit
impairments
recognized in
earnings on
securities that
have
been previously
impaired		Reductions due to
credit-impaired
securities sold,
transferred or
matured		September 30, 2017 balance
AFS debt securities      
Mortgage-backed securities$—
$1
$—
$(1)$—
$—
$—
$—
$—
$—
State and municipal12
—
—
(8)4
4
—
—
—
4
Foreign government securities5
—
—
(5)—
—
—
—
—
—
Corporate9
1
2
(6)6
5
—
—
(1)4
All other debt securities47
—
—
(24)23
22
—
2
(22)2
Total OTTI credit losses recognized for AFS debt securities$73
$2
$2
$(44)$33
$31
$—
$2
$(23)$10
HTM debt securities        
Mortgage-backed securities(1)
$132
$—
$—
$(26)$106
$101
$—
$—
$(4)$97
State and municipal4
1
—
(1)4
3
—
—
—
3
Total OTTI credit losses recognized for HTM debt securities$136
$1
$—
$(27)$110
$104
$—
$—
$(4)$100
(1)Primarily consists of Alt-A securities.

Non-Marketable Equity Securities Not Carried at Fair Value
Effective January 1, 2018, non-marketable equity securities are required to be measured at fair value with changes in fair value recognized in earnings unless (i) the measurement alternative is elected or (ii) the investment represents Federal Reserve Bank and Federal Home Loan Bank stock or certain exchange seats that continue to be carried at cost. See Note 1 to the Consolidated Financial Statements for additional details.
The election to measure a non-marketable equity security using the measurement alternative is made on an instrument-by-instrument basis. Under the measurement alternative, an equity security is carried at cost plus or minus changes resulting from observable prices in orderly transactions for the identical or a similar investment of the same issuer. The carrying value of the equity security is adjusted to fair value on the date of an observed transaction. Fair value may differ from the observed transaction price due to a number of factors, including marketability adjustments and differences in rights and obligations when the observed transaction is not for the identical investment held by Citi.
Equity securities under the measurement alternative are also assessed for impairment. On a quarterly basis, management qualitatively assesses whether each equity security under the measurement alternative is impaired. Impairment indicators that are considered include, but are not limited to, the following:

 a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee;
a significant adverse change in the regulatory, economic or technological environment of the investee;
a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates;
a bona fide offer to purchase, an offer by the investee to sell or a completed auction process for the same or similar investment for an amount less than the carrying amount of that investment; and
factors that raise significant concerns about the investee’s ability to continue as a going concern, such as negative cash flows from operations, working capital deficiencies or noncompliance with statutory capital requirements or debt covenants.

When the qualitative assessment indicates that impairment exists, the investment is written down to fair value, with the full difference between the fair value of the investment and its carrying amount recognized in earnings.


Below is the carrying value of non-marketable equity securities measured using the measurement alternative at September 30, 2018, and amounts recognized in earnings for the three and nine months ended September 30, 2018:
In millions of dollars
Three Months Ended
September 30, 2018
Nine Months Ended
September 30, 2018
Measurement alternative:



Balance as of September 30, 2018

$452
$452
Impairment losses(1)
—
4
Downward changes for observable prices(1)
14
18
Upward changes for observable prices(1)
21
133

(1)See Note 20 to the Consolidated Financial Statements for additional information on these nonrecurring fair value measurements.

A similar impairment analysis is performed for non-marketable equity securities carried at cost. For the three and nine months ended September 30, 2018, there was no
impairment loss recognized in earnings for non-marketable equity securities carried at cost.

Investments in Alternative Investment Funds That Calculate Net Asset Value
The Company holds investments in certain alternative investment funds that calculate net asset value (NAV), or its equivalent, including hedge funds, private equity funds, funds
of funds and real estate funds, as provided by third-party asset managers. Investments in such funds are generally classified as non-marketable equity securities carried at fair value. The fair values of these investments are estimated using the NAV of the Company’s ownership interest in the funds. Some of
these investments are in “covered funds” for purposes of the Volcker
Rule, which prohibits certain proprietary investment activities and limits the ownership of, and relationships with, covered funds. On April 21, 2017, Citi’s request for extension of the permitted holding period under the Volcker Rule for certain of its investments in illiquid funds was approved, allowing the Company to hold such investments until the earlier of 5 years from the July 21, 2017 expiration date of the general conformance period, or the date such investments mature or are otherwise conformed with the Volcker Rule.



Fair valueUnfunded
commitments
Redemption frequency
(if currently eligible)
monthly, quarterly, annually
Redemption 
notice
period
Fair valueUnfunded
commitments
Redemption frequency
(if currently eligible)
monthly, quarterly, annually
Redemption 
notice
period
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2017		December 31, 2016 September 30,
2018		December 31, 2017September 30,
2018		December 31, 2017 
Hedge funds$2
$4
$—
$—
Generally quarterly10–95 days$—
$1
$—
$—
Generally quarterly10–95 days
Private equity funds(1)(2)
369
348
82
82
—186
372
62
62
—
Real estate funds (2)(3)
34
56
23
20
—14
31
19
20
—
Mutual/collective investment funds25
—
—
—
—
Total$405
$408
$105
$102
—$225
$404
$81
$82
—
(1)Private equity funds include funds that invest in infrastructure, emerging markets and venture capital.
(2)With respect to the Company’s investments in private equity funds and real estate funds, distributions from each fund will be received as the underlying assets held by these funds are liquidated. It is estimated that the underlying assets of these funds will be liquidated over a period of several years as market conditions allow. Private equity and real estate funds do not allow redemption of investments by their investors. Investors are permitted to sell or transfer their investments, subject to the approval of the general partner or investment manager of these funds, which generally may not be unreasonably withheld.
(3)Includes several real estate funds that invest primarily in commercial real estate in the U.S., Europe and Asia.


13.   LOANS

Citigroup loans are reported in two categories—categories: consumer and corporate. These categories are classified primarily according to the segment and subsegment that manage the loans. For additional information regarding Citi’s consumer and corporate loans, including related accounting policies, see Note 14 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.

Consumer Loans
Consumer loans represent loans and leases managed primarily by GCB and Corporate/Other. The following table provides Citi’s consumer loans by loan type:

In millions of dollarsSeptember 30, 2017December 31, 2016September 30,
2018		December 31, 2017
In U.S. offices  
Mortgage and real estate(1)
$67,131
$72,957
$61,048
$65,467
Installment, revolving credit and other3,191
3,395
3,515
3,398
Cards131,476
132,654
137,051
139,006
Commercial and industrial7,619
7,159
7,686
7,840
$209,417
$216,165
$209,300
$215,711
In offices outside the U.S.    
Mortgage and real estate(1)
$43,723
$42,803
$43,714
$44,081
Installment, revolving credit and other26,153
24,887
27,899
26,556
Cards25,443
23,783
24,971
26,257
Commercial and industrial20,015
16,568
18,821
20,238
Lease financing77
81
52
76
$115,411
$108,122
$115,457
$117,208
Total consumer loans$324,828
$324,287
$324,757
$332,919
Net unearned income$748
776
$712
$737
Consumer loans, net of unearned income$325,576
$325,063
$325,469
$333,656

(1)Loans secured primarily by real estate.

The Company sold and/or reclassified to held-for-sale $0.3 billion and $3.0 billion, $0.4 billion and $3.2 billion, $1.3 billion and $6.0 billion of consumer loans during the three and nine months ended September 30, 20172018 and 2016,2017, respectively.

 










Consumer Loan Delinquency and Non-Accrual Details at September 30, 20172018
In millions of dollars
Total
current(1)(2)
30–89 days
past due(3)
≥ 90 days
past due(3)
Past due
government
guaranteed(4)
Total
loans(2)
Total
non-accrual
90 days past due
and accruing
Total
current(1)(2)
30–89 days
past due(3)
≥ 90 days
past due(3)
Past due
government
guaranteed(4)
Total
loans(2)
Total
non-accrual
90 days past due
and accruing
In North America offices        
Residential first mortgages(5)
$48,090
$563
$286
$1,279
$50,218
$724
$985
$46,038
$503
$263
$903
$47,707
$628
$641
Home equity loans(6)(7)
15,004
223
362
—
15,589
766
—
11,693
174
264
—
12,131
561
—
Credit cards129,261
1,541
1,440
—
132,242
—
1,440
134,721
1,612
1,539
—
137,872
—
1,539
Installment and other3,456
42
15
—
3,513
21
—
3,473
40
14
—
3,527
20
—
Commercial banking9,294
38
52
—
9,384
210
11
Commercial banking loans9,206
25
48
—
9,279
114
—
Total$205,105
$2,407
$2,155
$1,279
$210,946
$1,721
$2,436
$205,131
$2,354
$2,128
$903
$210,516
$1,323
$2,180
In offices outside North America       
Residential first mortgages(5)
$36,796
$225
$153
$—
$37,174
$400
$—
$35,919
$217
$146
$—
$36,282
$397
$—
Credit cards24,109
433
366
—
24,908
322
251
23,638
420
356
—
24,414
314
223
Installment and other25,207
283
124
—
25,614
164
—
25,192
267
108
—
25,567
163
—
Commercial banking26,788
58
86
—
26,932
176
—
Commercial banking loans28,569
54
66
—
28,689
177
—
Total$112,900
$999
$729
$—
$114,628
$1,062
$251
$113,318
$958
$676
$—
$114,952
$1,051
$223
Total GCB and Corporate/Other consumer
$318,005
$3,406
$2,884
$1,279
$325,574
$2,783
$2,687
Total GCB and Corporate/Other—
Consumer
$318,449
$3,312
$2,804
$903
$325,468
$2,374
$2,403
Other(8)
2
—
—
—
2
—
—
1
—
—
—
1
—
—
Total Citigroup$318,007
$3,406
$2,884
$1,279
$325,576
$2,783
$2,687
$318,450
$3,312
$2,804
$903
$325,469
$2,374
$2,403
(1)Loans less than 30 days past due are presented as current.
(2)Includes $27$21 million of residential first mortgages recorded at fair value.
(3)Excludes loans guaranteed by U.S. government-sponsored entities.
(4)Consists of residential first mortgages that are guaranteed by U.S. government-sponsored entities that are 30–89 days past due of $0.3$0.2 billion and 90 days or more past due of $0.7 billion.
(5)Includes approximately $0.1 billion of residential first mortgage loans in process of foreclosure.
(6)Includes approximately $0.1 billion of home equity loans in process of foreclosure.
(7)Fixed-rate home equity loans and loans extended under home equity lines of credit, which are typically in junior lien positions.
(8)
Represents loans classified as consumer loans on the Consolidated Balance Sheet that are not included in GCB or Corporate/Other consumer credit metrics.


Consumer Loan Delinquency and Non-Accrual Details at December 31, 2017
In millions of dollars
Total
current(1)(2)
30–89 days
past due(3)
≥ 90 days
past due(3)
Past due
government
guaranteed(4)
Total
loans(2)
Total
non-accrual
90 days past due
and accruing
In North America offices       
Residential first mortgages(5)
$47,366
$505
$280
$1,225
$49,376
$665
$941
Home equity loans(6)(7)
14,268
207
352
—
14,827
750
—
Credit cards136,588
1,528
1,613
—
139,729
—
1,596
Installment and other3,395
45
16
—
3,456
22
1
Commercial banking loans9,395
51
65
—
9,511
213
—
Total$211,012
$2,336
$2,326
$1,225
$216,899
$1,650
$2,538
In offices outside North America       
Residential first mortgages(5)
$37,062
$209
$148
$—
$37,419
$400
$—
Credit cards24,934
427
366
—
25,727
323
259
Installment and other25,634
275
123
—
26,032
157
—
Commercial banking loans27,449
57
72
—
27,578
160
—
Total$115,079
$968
$709
$—
$116,756
$1,040
$259
Total GCB and Corporate/Other—
  Consumer
$326,091
$3,304
$3,035
$1,225
$333,655
$2,690
$2,797
Other(8)
1
—
—
—
1
—
—
Total Citigroup$326,092
$3,304
$3,035
$1,225
$333,656
$2,690
$2,797
(1)Loans less than 30 days past due are presented as current.
(2)Includes $25 million of residential first mortgages recorded at fair value.
(3)Excludes loans guaranteed by U.S. government-sponsored entities.
(4)Consists of residential first mortgages that are guaranteed by U.S. government-sponsored entities that are 30–89 days past due of $0.2 billion and 90 days or more past due of $1.0 billion.
(5)Includes approximately $0.1 billion of residential first mortgage loans in process of foreclosure.
(6)Includes approximately $0.1 billion of home equity loans in process of foreclosure.
(7)Fixed-rate home equity loans and loans extended under home equity lines of credit, which are typically in junior lien positions.
(8)
Represents loans classified as consumer loans on the Consolidated Balance Sheet that are not included in the Corporate/OtherGCB consumer credit metrics.


Consumer Loan Delinquency and Non-Accrual Details at December 31, 2016
In millions of dollars
Total
current(1)(2)
30–89 days
past due(3)
≥ 90 days
past due(3)
Past due
government
guaranteed(4)
Total
loans(2)
Total
non-accrual
90 days past due
and accruing
In North America offices       
Residential first mortgages(5)
$50,766
$522
$371
$1,474
$53,133
$848
$1,227
Home equity loans(6)(7)
18,767
249
438
—
19,454
914
—
Credit cards130,327
1,465
1,509
—
133,301
—
1,509
Installment and other4,486
106
38
—
4,630
70
2
Commercial banking8,876
23
74
—
8,973
328
14
Total$213,222
$2,365
$2,430
$1,474
$219,491
$2,160
$2,752
In offices outside North America       
Residential first mortgages(5)
$35,862
$206
$135
$—
$36,203
$360
$—
Credit cards22,363
368
324
—
23,055
258
239
Installment and other22,683
264
126
—
23,073
163
—
Commercial banking23,054
72
112
—
23,238
217
—
Total$103,962
$910
$697
$—
$105,569
$998
$239
Total GCB and Corporate/Other consumer
$317,184
$3,275
$3,127
$1,474
$325,060
$3,158
$2,991
Other(8)
3
—
—
—
3
—
—
Total Citigroup$317,187
$3,275
$3,127
$1,474
$325,063
$3,158
$2,991
(1)Loans less than 30 days past due are presented as current.
(2)Includes $29 million of residential first mortgages recorded at fair value.
(3)Excludes loans guaranteed by U.S. government-sponsored entities.
(4)Consists of residential first mortgages that are guaranteed by U.S. government-sponsored entities that are 30–89 days past due of $0.2 billion and 90 days or more past due of $1.3 billion.
(5)Includes approximately $0.1 billion of residential first mortgage loans in process of foreclosure.
(6)Includes approximately $0.1 billion of home equity loans in process of foreclosure.
(7)Fixed-rate home equity loans and loans extended under home equity lines of credit, which are typically in junior lien positions.
(8)
Represents loans classified as consumer loans on the Consolidated Balance Sheet that are not included in the Corporate/Other consumer credit metrics.

Consumer Credit Scores (FICO)
The following tables provide details on the FICO scores for Citi’s U.S. consumer loan portfolio based on end-of-period receivables (commercial banking loans are excluded from the table since they are business based and FICO scores are not a primary driver in their credit evaluation). FICO scores are updated monthly for substantially all of the portfolio or, otherwise, on a quarterly basis for the remaining portfolio.
FICO score distribution in U.S. portfolio(1)(2)
September 30, 2017September 30, 2018
In millions of dollars
Less than
620
≥ 620 but less
than 660
Equal to or
greater
than 660
Less than
680		680 to 760Greater
than 760
Residential first mortgages$2,275
$2,053
$42,682
$4,647
$13,854
$26,553
Home equity loans1,432
1,166
12,622
2,575
4,495
4,692
Credit cards8,699
11,325
108,809
31,379
56,636
47,675
Installment and other270
252
2,414
624
1,080
1,189
Total$12,676
$14,796
$166,527
$39,225
$76,065
$80,109
 

FICO score distribution in U.S. portfolio(1)(2)
December 31, 2016December 31, 2017

In millions of dollars
Less than
620
≥ 620 but less
than 660
Equal to or
greater
than 660
Less than
680
680 to 760
Greater
than 760
Residential first mortgages$2,744
$2,422
$44,279
$5,603
$14,423
$26,271
Home equity loans1,750
1,418
14,743
3,347
5,439
5,650
Credit cards8,310
11,320
110,522
30,875
56,443
48,989
Installment and other284
271
2,601
716
1,020
1,275
Total$13,088
$15,431
$172,145
$40,541
$77,325
$82,185
(1)Excludes loans guaranteed by U.S. government entities, loans subject to long-term standby commitments (LTSC) with U.S. government-sponsored entities and loans recorded at fair value.
(2)Excludes balances where FICO was not available. Such amounts are not material.



Loan to Value (LTV) Ratios
The following tables provide details on the LTV ratios for Citi’s U.S. consumer mortgage portfolios. LTV ratios are updated monthly using the most recent Core Logic Home Price Index data available for substantially all of the portfolio applied at the Metropolitan Statistical Area level, if available, or the state level if not. The remainder of the portfolio is updated in a similar manner using the Federal Housing Finance Agency indices.
LTV distribution in U.S. portfolio(1)(2)
September 30, 2017September 30, 2018
In millions of dollars
Less than or
equal to 80%
> 80% but less
than or equal to
100%
Greater
than
100%
Less than or
equal to 80%
> 80% but less
than or equal to
100%
Greater
than
100%
Residential first mortgages$44,253
$2,658
$262
$42,823
$2,205
$151
Home equity loans11,808
2,397
928
9,884
1,366
446
Total$56,061
$5,055
$1,190
$52,707
$3,571
$597
LTV distribution in U.S. portfolio(1)(2)
December 31, 2016December 31, 2017
In millions of dollars
Less than or
equal to 80%
> 80% but less
than or equal to
100%
Greater
than
100%
Less than or
equal to 80%
> 80% but less
than or equal to
100%
Greater
than
100%
Residential first mortgages$45,849
$3,467
$324
$43,626
$2,578
$247
Home equity loans12,869
3,653
1,305
11,403
2,147
800
Total$58,718
$7,120
$1,629
$55,029
$4,725
$1,047
(1)Excludes loans guaranteed by U.S. government entities, loans subject to LTSCs with U.S. government-sponsored entities and loans recorded at fair value.
(2)Excludes balances where LTV was not available. Such amounts are not material.



Impaired Consumer Loans

The following tables present information about impaired consumer loans and interest income recognized on impaired consumer loans:
 Three Months Ended 
 September 30,		Nine Months Ended September 30, Three Months Ended 
 September 30,		Nine Months Ended September 30,
Balance at September 30, 20172017201620172016Balance at September 30, 20182018201720182017
In millions of dollars
Recorded
investment(1)(2)
Unpaid
principal balance
Related
specific allowance(3)
Average
carrying value (4)
Interest income
recognized(5)
Interest income
recognized(5)
Interest income
recognized(5)
Interest income
recognized(5)
Recorded
investment(1)(2)
Unpaid
principal balance
Related
specific allowance(3)
Average
carrying value(4)
Interest income
recognized(5)
Interest income
recognized(5)
Interest income
recognized(5)
Interest income
recognized(5)
Mortgage and real estate          
Residential first mortgages$2,938
$3,161
$289
$3,383
$29
$31
$97
$135
$2,294
$2,508
$197
$2,670
$21
$29
$63
$97
Home equity loans1,169
1,636
219
1,217
7
8
21
26
704
980
125
815
2
7
10
21
Credit cards1,819
1,852
603
1,793
37
42
110
122
1,801
1,828
654
1,807
24
37
79
110
Installment and other           
Individual installment and other429
456
177
421
5
8
18
22
406
436
153
421
5
5
17
18
Commercial banking402
657
49
474
4
7
18
11
296
441
46
306
2
4
10
18
Total$6,757
$7,762
$1,337
$7,288
$82
$96
$264
$316
$5,501
$6,193
$1,175
$6,019
$54
$82
$179
$264
(1)Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount and direct write-downs and includes accrued interest only on credit card loans.
(2)$622529 million of residential first mortgages, $376$270 million of home equity loans and $88$25 million of commercial market loans do not have a specific allowance.
(3)    Included in the Allowance for loan losses.
(4) Average carrying value represents the average recorded investment ending balance for the last four quarters and does not include the related specific allowance.
(4)Average carrying value represents the average recorded investment ending balance for the last four quarters and does not include the related specific allowance.
(5)    Includes amounts recognized on both an accrual and cash basis.

Balance, December 31, 2016Balance, December 31, 2017
In millions of dollars
Recorded
investment(1)(2)
Unpaid
principal balance
Related
specific allowance(3)
Average
carrying value(4)
Recorded
investment(1)(2)
Unpaid
principal balance
Related
specific allowance(3)
Average
carrying value(4)
Mortgage and real estate  
Residential first mortgages$3,786
$4,157
$540
$4,632
$2,877
$3,121
$278
$3,155
Home equity loans1,298
1,824
189
1,326
1,151
1,590
216
1,181
Credit cards1,747
1,781
566
1,831
1,787
1,819
614
1,803
Installment and other  
Individual installment and other455
481
215
475
431
460
175
415
Commercial banking513
744
98
538
334
541
51
429
Total$7,799
$8,987
$1,608
$8,802
$6,580
$7,531
$1,334
$6,983
(1)Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount and direct write-downs and includes accrued interest only on credit card loans.
(2)$740607 million of residential first mortgages, $406$370 million of home equity loans and $97$10 million of commercial market loans do not have a specific allowance.
(3)
Included in the Allowance for loan losses.
(4)Average carrying value represents the average recorded investment ending balance for the last four quarters and does not include the related specific allowance.





Consumer Troubled Debt Restructurings
At and for the three months ended September 30, 2017For the Three Months Ended September 30, 2018
In millions of dollars except number of loans modifiedNumber of
loans modified
Post-
modification
recorded
investment(1)(2)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
In millions of dollars, except number of loans modifiedNumber of
loans modified
Post-
modification
recorded
investment(1)(2)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
North America      
Residential first mortgages1,400
$199
$1
$—
$—
—%461
$66
$—
$—
$—
—%
Home equity loans830
70
5
—
—
1
261
26
1
—
—
1
Credit cards59,285
225
—
—
—
17
61,508
253
—
—
—
18
Installment and other revolving299
2
—
—
—
6
322
2
—
—
—
5
Commercial banking(6)
33
59
—
—
—
—
11
3
—
—
—
—
Total(8)
61,847
$555
$6
$—
$—


62,563
$350
$1
$—
$—


International      
Residential first mortgages703
$25
$—
$—
$—
—%660
$22
$—
$—
$—
—%
Credit cards28,254
103
—
—
2
11
18,413
77
—
—
2
17
Installment and other revolving11,725
70
—
—
3
11
6,421
34
—
—
2
10
Commercial banking(6)
97
11
—
—
—
—
131
9
—
—
—
—
Total(8)
40,779
$209
$—
$—
$5


25,625
$142
$—
$—
$4



At and for the three months ended September 30, 2016For the Three Months Ended September 30, 2017
In millions of dollars except number of loans modified
Number of
loans modified
Post-
modification
recorded
investment(1)(7)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
In millions of dollars, except number of loans modified
Number of
loans modified
Post-
modification
recorded
investment(1)(7)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
North America      
Residential first mortgages1,165
$165
$1
$—
$1
1%1,400
$199
$1
$—
$—
—%
Home equity loans1,117
61
—
—
—
2
830
70
5
—
—
1
Credit cards51,260
199
—
—
—
18
59,285
225
—
—
—
17
Installment and other revolving1,421
12
—
—
—
14
299
2
—
—
—
6
Commercial banking(6)
30
36
—
—
—
—
33
59
—
—
—
—
Total(8)
54,993
$473
$1
$—
$1
 
61,847
$555
$6
$—
$—
 
International      
Residential first mortgages973
$24
$—
$—
$—
—%703
$25
$—
$—
$—
—%
Credit cards28,530
94
—
—
2
12
28,254
103
—
—
2
11
Installment and other revolving12,283
69
—
—
2
8
11,725
70
—
—
3
11
Commercial banking(6)
44
39
—
—
—
—
97
11
—
—
—
—
Total(8)
41,830
$226
$—
$—
$4
 
40,779
$209
$—
$—
$5
 

(1)Post-modification balances include past due amounts that are capitalized at the modification date.
(2)
Post-modification balances in North America include $12$10 million of residential first mortgages and $5$2 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the three months ended September 30, 2017.2018. These amounts include $7 million of residential first mortgages and $5$2 million of home equity loans that were newly classified as TDRs in the three months ended September 30, 2017,2018, based on previously received OCC guidance.
(3)Represents portion of contractual loan principal that is non-interest bearing, but still due from the borrower. Such deferred principal is charged off at the time of permanent modification to the extent that the related loan balance exceeds the underlying collateral value.
(4)Represents portion of contractual loan principal that is non-interest bearing and, depending upon borrower performance, eligible for forgiveness.
(5)Represents portion of contractual loan principal that was forgiven at the time of permanent modification.
(6) Commercial banking loans are generally borrower-specific modifications and incorporate changes in the amount and/or timing of principal and/or interest.
(7) Post-modification balances in North America include $17 million of residential first mortgages and $5 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the three months ended September 30, 2016. These amounts include $11 million of residential first mortgages and $5 million of home equity loans that were newly classified as TDRs in the three months ended September 30, 2016,
(6)Commercial banking loans are generally borrower-specific modifications and incorporate changes in the amount and/or timing of principal and/or interest.
(7)
Post-modification balances in North America include $12 million of residential first mortgages and $5 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the three months ended September 30, 2017. These amounts include $7 million of residential first mortgages and $5 million of home equity loans that were newly classified as TDRs in the three months ended September 30, 2017, based on previously received OCC guidance.
(8) The above tables reflect activity for loans outstanding as of the end of the reporting period that were considered TDRs.
(8)The above tables reflect activity for loans outstanding that were considered TDRs as of the end of the reporting period.



At and for the nine months ended September 30, 2017For the Nine Months Ended September 30, 2018
In millions of dollars except number of loans modified
Number of
loans modified
Post-
modification
recorded
investment(1)(2)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
In millions of dollars, except number of loans modified
Number of
loans modified
Post-
modification
recorded
investment(1)(2)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
North America      
Residential first mortgages3,172
$445
$5
$—
$2
1%1,544
$233
$2
$—
$—
—%
Home equity loans2,186
185
13
—
—
1
1,097
104
4
—
—
1
Credit cards171,702
659
—
—
—
17
180,170
717
—
—
—
17
Installment and other revolving770
6
—
—
—
5
956
7
—
—
—
5
Commercial banking(6)
89
107
—
—
—
—
37
5
—
—
—
—
Total(8)
177,919
$1,402
$18
$—
$2


183,804
$1,066
$6
$—
$—
 
International      
Residential first mortgages2,071
$80
$—
$—
$—
—%1,833
$62
$—
$—
$—
—%
Credit cards82,042
286
—
—
6
12
59,589
249
—
—
7
16
Installment and other revolving34,654
194
—
—
9
9
22,918
136
—
—
6
10
Commercial banking(6)
182
30
—
—
—
—
433
60
—
—
—
1
Total(8)
118,949
$590
$—
$—
$15


84,773
$507
$—
$—
$13
 

At and for the nine months ended September 30, 2016For the Nine Months Ended September 30, 2017
In millions of dollars except number of loans modified
Number of
loans modified
Post-
modification
recorded
investment(1)(7)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
In millions of dollars, except number of loans modified
Number of
loans modified
Post-
modification
recorded
investment(1)(7)
Deferred
principal(3)
Contingent
principal
forgiveness(4)
Principal
forgiveness(5)
Average
interest rate
reduction
North America      
Residential first mortgages3,979
$582
$4
$—
$3
1%3,172
$445
$5
$—
$2
1%
Home equity loans2,789
121
1
—
—
2
2,186
185
13
—
—
1
Credit cards143,161
552
—
—
—
17
171,702
659
—
—
—
17
Installment and other revolving4,187
35
—
—
—
14
770
6
—
—
—
5
Commercial banking(6)
94
47
—
—
—
—
89
107
—
—
—
—
Total(8)
154,210
$1,337
$5
$—
$3
 177,919
$1,402
$18
$—
$2
 
International      
Residential first mortgages2,005
$62
$—
$—
$—
—%2,071
$80
$—
$—
$—
—%
Credit cards109,365
307
—
—
7
12
82,042
286
—
—
6
12
Installment and other revolving45,125
208
—
—
6
7
34,654
194
—
—
9
9
Commercial banking(6)
117
90
—
—
—
—
182
30
—
—
—
—
Total(8)
156,612
$667
$—
$—
$13
 118,949
$590
$—
$—
$15
 

(1)Post-modification balances include past due amounts that are capitalized at the modification date.
(2)
Post-modification balances in North America include $42$29 million of residential first mortgages and $16$10 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the nine months ended September 30, 2017.2018. These amounts include $28$20 million of residential first mortgages and $14$9 million of home equity loans that were newly classified as TDRs in the nine months ended September 30, 2017,2018, based on previously received OCC guidance.
(3)Represents portion of contractual loan principal that is non-interest bearing but still due from the borrower. Such deferred principal is charged off at the time of permanent modification to the extent that the related loan balance exceeds the underlying collateral value.
(4)Represents portion of contractual loan principal that is non-interest bearing and, depending upon borrower performance, eligible for forgiveness.
(5)Represents portion of contractual loan principal that was forgiven at the time of permanent modification.
(6)
(6)Commercial banking loans are generally borrower-specific modifications and incorporate changes in the amount and/or timing of principal and/or interest.
(7)
Post-modification balances in North America include $42 million of residential first mortgages and $16 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the nine months ended September 30, 2017. These amounts include $28 million of residential first mortgages and $14 million of home equity loans that were newly classified as TDRs in the nine months ended September 30, 2017, based on previously received OCC guidance.
(8)The above tables reflect activity for loans outstanding that were considered TDRs as of the end of the reporting period.

(7) Post-modification balances in North America include $58 million of residential first mortgages and $15 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the nine months ended September 30, 2016. These amounts include $38 million of residential first mortgages and $14 million of home equity loans that were newly classified as TDRs in the nine months ended September 30, 2016, based on previously received OCC guidance.
(8) The above tables reflect activity for loans outstanding as of the end of the reporting period that were considered TDRs.



The following table presents consumer TDRs that defaulted for which the payment default occurred within one year of a permanent modification. Default is defined as 60 days past due, except for classifiably managed commercial banking loans, where default is defined as 90 days past due.
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
North America  
Residential first mortgages$57
$49
$156
$188
$31
$57
$105
$156
Home equity loans8
6
25
20
5
8
21
25
Credit cards54
43
163
139
57
54
173
163
Installment and other revolving1
3
2
7
1
1
2
2
Commercial banking—
12
2
14
1
—
22
2
Total$120
$113
$348
$368
$95
$120
$323
$348
International  
Residential first mortgages$3
$3
$8
$9
$2
$3
$6
$8
Credit cards48
41
136
115
48
48
156
136
Installment and other revolving25
24
71
70
18
25
62
71
Commercial banking—
21
—
36
7
—
17
—
Total$76
$89
$215
$230
$75
$76
$241
$215

Corporate Loans
Corporate loans represent loans and leases managed by ICG. The following table presents information by corporate loan type:
In millions of dollarsSeptember 30,
2017		December 31,
2016		September 30,
2018		December 31,
2017
In U.S. offices  
Commercial and industrial$51,679
$49,586
$51,365
$51,319
Financial institutions37,203
35,517
46,255
39,128
Mortgage and real estate(1)
43,274
38,691
47,629
44,683
Installment, revolving credit and other32,464
34,501
32,201
33,181
Lease financing1,493
1,518
1,445
1,470
$166,113
$159,813
$178,895
$169,781
In offices outside the U.S.    
Commercial and industrial$93,107
$81,882
$98,281
$93,750
Financial institutions33,050
26,886
37,851
35,273
Mortgage and real estate(1)
6,383
5,363
7,344
7,309
Installment, revolving credit and other23,830
19,965
22,827
22,638
Lease financing216
251
131
190
Governments and official institutions5,628
5,850
4,898
5,200
$162,214
$140,197
$171,332
$164,360
Total corporate loans$328,327
$300,010
$350,227
$334,141
Net unearned income$(720)$(704)$(787)$(763)
Corporate loans, net of unearned income$327,607
$299,306
$349,440
$333,378
(1)Loans secured primarily by real estate.
 

The Company sold and/or reclassified to held-for-sale $0.1$0.3 billion and $0.6$0.8 billion of corporate loans during the three and nine months ended September 30, 2017,2018, respectively, and $1.3$0.1 billion and $2.6$0.6 billion during the three and nine months ended September 30, 2016,2017, respectively. The Company did not have significant purchases of corporate loans classified as held-for-investment for the three and nine months ended September 30, 20172018 or 2016.2017.




Corporate Loan Delinquency and Non-Accrual Details at September 30, 20172018
In millions of dollars
30–89 days
past due
and accruing(1)
≥ 90 days
past due and
accruing(1)
Total past due
and accruing
Total
non-accrual(2)
Total
current(3)
Total
loans (4)
30–89 days
past due
and accruing(1)
≥ 90 days
past due and
accruing(1)
Total past due
and accruing
Total
non-accrual(2)
Total
current(3)
Total
loans(4)
Commercial and industrial$208
$58
$266
$1,468
$139,508
$141,242
$430
$30
$460
$1,123
$145,612
$147,195
Financial institutions348
1
349
224
69,232
69,805
146
9
155
74
82,299
82,528
Mortgage and real estate280
9
289
169
49,176
49,634
209
5
214
258
54,492
54,964
Leases31
18
49
60
1,590
1,699
16
3
19
—
1,557
1,576
Other402
30
432
133
60,381
60,946
79
41
120
85
58,754
58,959
Loans at fair value









4,281
   4,218
Purchased distressed loans









—
Total$1,269
$116
$1,385
$2,054
$319,887
$327,607
$880
$88
$968
$1,540
$342,714
$349,440

Corporate Loan Delinquency and Non-Accrual Details at December 31, 20162017
In millions of dollars
30–89 days
past due
and accruing(1)
≥ 90 days
past due and
accruing(1)
Total past due
and accruing
Total
non-accrual(2)
Total
current(3)
Total
loans (4)
30–89 days
past due
and accruing(1)
≥ 90 days
past due and
accruing(1)
Total past due
and accruing
Total
non-accrual(2)
Total
current(3)
Total
loans(4)
Commercial and industrial$143
$52
$195
$1,909
$127,012
$129,116
$249
$13
$262
$1,506
$139,554
$141,322
Financial institutions119
2
121
185
61,254
61,560
93
15
108
92
73,557
73,757
Mortgage and real estate148
137
285
139
43,607
44,031
147
59
206
195
51,563
51,964
Leases27
8
35
56
1,678
1,769
68
8
76
46
1,533
1,655
Other349
12
361
132
58,880
59,373
70
13
83
103
60,145
60,331
Loans at fair value









3,457
   4,349
Purchased distressed loans









—
Total$786
$211
$997
$2,421
$292,431
$299,306
$627
$108
$735
$1,942
$326,352
$333,378
(1)Corporate loans that are 90 days past due are generally classified as non-accrual. Corporate loans are considered past due when principal or interest is contractually due but unpaid.
(2)Non-accrual loans generally include those loans that are ≥ 90 days past due or those loans for which Citi believes, based on actual experience and a forward-looking assessment of the collectability of the loan in full, that the payment of interest or principal is doubtful.
(3)Loans less than 30 days past due are presented as current.
(4)Total loans include loans at fair value, which are not included in the various delinquency columns.






Corporate Loans Credit Quality Indicators
Recorded investment in loans(1)
Recorded investment in loans(1)
In millions of dollarsSeptember 30,
2017		December 31,
2016		September 30,
2018		December 31,
2017
Investment grade(2)
  
Commercial and industrial$100,024
$87,201
$102,875
$101,313
Financial institutions58,666
50,597
70,435
60,404
Mortgage and real estate22,102
18,718
24,351
23,213
Leases1,117
1,303
1,054
1,090
Other55,231
52,828
53,609
56,306
Total investment grade$237,140
$210,647
$252,324
$242,326
Non-investment grade(2)
  
Accrual  
Commercial and industrial$39,750
$39,874
$43,196
$38,503
Financial institutions10,916
10,873
12,019
13,261
Mortgage and real estate2,256
1,821
3,240
2,881
Leases522
410
523
518
Other5,580
6,450
5,264
3,924
Non-accrual  
Commercial and industrial1,468
1,909
1,123
1,506
Financial institutions224
185
74
92
Mortgage and real estate169
139
258
195
Leases60
56
—
46
Other133
132
85
103
Total non-investment grade$61,078
$61,849
$65,782
$61,029
Non-rated private bank loans managed on a delinquency basis(2)
$25,108
$23,353
$27,116
$25,674
Loans at fair value4,281
3,457
4,218
4,349
Corporate loans, net of unearned income$327,607
$299,306
$349,440
$333,378
(1)Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount, less any direct write-downs.
(2)Held-for-investment loans are accounted for on an amortized cost basis.
 













Non-Accrual Corporate Loans
The following tables present non-accrual loan information by corporate loan type and interest income recognized on non-accrual corporate loans:
September 30, 2017Three Months Ended 
 September 30, 2017		Nine Months Ended 
 September 30, 2017		September 30, 2018Three Months Ended 
 September 30, 2018		Nine Months Ended 
 September 30, 2018
In millions of dollars
Recorded
investment(1)
Unpaid
principal balance
Related specific
allowance
Average
carrying
 value(2)
Interest
 income recognized(3)
Interest income recognized(3)
Recorded
investment(1)
Unpaid
principal balance
Related specific
allowance
Average
carrying
 value(2)
Interest
 income recognized(3)
Interest income recognized(3)
Non-accrual corporate loans        
Commercial and industrial$1,468
$1,682
$336
$1,648
$10
$20
$1,123
$1,379
$207
$1,246
$8
$24
Financial institutions224
340
27
236
—
—
74
90
39
97
—
—
Mortgage and real estate169
293
9
169
—
9
258
423
45
228
—
1
Lease financing60
60
4
62
—
—
—
39
—
33
—
—
Other133
240
1
115
1
1
85
205
13
90
—
—
Total non-accrual corporate loans$2,054
$2,615
$377
$2,230
$11
$30
$1,540
$2,136
$304
$1,694
$8
$25
December 31, 2016December 31, 2017
In millions of dollars
Recorded
investment(1)
Unpaid
principal balance
Related specific
allowance
Average
carrying
 value(2)
Recorded
investment(1)
Unpaid
principal balance
Related specific
allowance
Average
carrying
 value(2)
Non-accrual corporate loans  
Commercial and industrial$1,909
$2,259
$362
$1,919
$1,506
$1,775
$368
$1,547
Financial institutions185
192
16
183
92
102
41
212
Mortgage and real estate139
250
10
174
195
324
11
183
Lease financing56
56
4
44
46
46
4
59
Other132
197
—
87
103
212
2
108
Total non-accrual corporate loans$2,421
$2,954
$392
$2,407
$1,942
$2,459
$426
$2,109
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollars
Recorded
investment(1)
Related specific
allowance
Recorded
investment(1)
Related specific
allowance
Recorded
investment(1)
Related specific
allowance
Recorded
investment(1)
Related specific
allowance
Non-accrual corporate loans with valuation allowances      
Commercial and industrial$919
$336
$1,343
$362
$643
$207
$1,017
$368
Financial institutions58
27
45
16
72
39
88
41
Mortgage and real estate34
9
41
10
122
45
51
11
Lease financing48
4
55
4
—
—
46
4
Other3
1
1
—
17
13
13
2
Total non-accrual corporate loans with specific allowance$1,062
$377
$1,485
$392
$854
$304
$1,215
$426
Non-accrual corporate loans without specific allowance      
Commercial and industrial$549
 
$566
 
$480
 
$489
 
Financial institutions166
 
140
 
2
 
4
 
Mortgage and real estate135
 
98
 
136
 
144
 
Lease financing12
 
1
 
—
 
—
 
Other130
 
131
 
68
 
90
 
Total non-accrual corporate loans without specific allowance$992
N/A
$936
N/A
$686
N/A
$727
N/A
(1)Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount, less any direct write-downs.
(2)Average carrying value represents the average recorded investment balance and does not include related specific allowance.
(3)Interest income recognized for the three-three and nine-month periodsnine months ended September 30, 20162017 was $10$11 million and $36 million.$30 million, respectively.
N/A Not applicable


Corporate Troubled Debt Restructurings

At and forFor the three months ended September 30, 2018:
In millions of dollarsCarrying value of TDRs modified during the period
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Commercial and industrial$62
$1
$4
$57
Mortgage and real estate3
—
—
3
Total$65
$1
$4
$60
For the three months ended September 30, 2017:
In millions of dollars
Carrying
Value
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Carrying value of TDRs modified during the period
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Commercial and industrial$175
$99
$—
$76
$175
$99
$—
$76
Mortgage and real estate14
—
—
14
14
—
—
14
Total$189
$99
$—
$90
$189
$99
$—
$90
At and forFor the threenine months ended September 30, 2016:2018:
In millions of dollars
Carrying
Value
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Carrying value of TDRs modified during the period
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Commercial and industrial$112
$103
$2
$7
$103
$5
$8
$90
Financial institutions10
10
—
—
Mortgage and real estate2
1
—
1
6
—
—
6
Total$124
$114
$2
$8
$109
$5
$8
$96

At and forFor the nine months ended September 30, 2017:
In millions of dollars
Carrying
Value
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Carrying value of TDRs modified during the period
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Commercial and industrial$463
$131
$—
$332
$463
$131
$—
$332
Financial institutions15
—
—
15
Mortgage and real estate18
—
—
18
15
—
—
15
Other18
—
—
18
Total$496
$131
$—
$365
$496
$131
$—
$365
At and for the nine months ended September 30, 2016:
In millions of dollars
Carrying
Value
TDRs
involving changes
in the amount
and/or timing of
principal payments(1)
TDRs
involving changes
in the amount
and/or timing of
interest payments(2)
TDRs
involving changes
in the amount
and/or timing of
both principal and
interest payments
Commercial and industrial$316
$176
$34
$106
Financial institutions10
10
—
—
Mortgage and real estate7
1
—
6
Other142
—
142
—
Total$475
$187
$176
$112

(1)TDRs involving changes in the amount or timing of principal payments may involve principal forgiveness or deferral of periodic and/or final principal payments. Because forgiveness of principal is rare for corporate loans, modifications typically have little to no impact on the loans’ projected cash flows and thus little to no impact on the allowance established for the loans. Charge-offs for amounts deemed uncollectable may be recorded at the time of the restructuring or may have already been recorded in prior periods such that no charge-off is required at the time of the modification.
(2)TDRs involving changes in the amount or timing of interest payments may involve a below-market interest rate.







The following table presents total corporate loans modified in a TDR as well as those TDRs that defaulted and for which the payment default occurred within one year of a permanent modification. Default is defined as 60 days past due, except for classifiably managed commercial banking loans, where default is defined as 90 days past due.
In millions of dollarsTDR balances at September 30, 2017
TDR loans in payment default during the three months ended
September 30, 2017
TDR loans in payment default nine months ended September 30, 2017
TDR balances at
September 30, 2016
TDR loans in payment default during the three months ended
September 30, 2016
TDR loans in payment default during the nine months ended
September 30, 2016		TDR balances at September 30, 2018
TDR loans in payment default during the three months ended
September 30, 2018
TDR loans in payment default nine months ended September 30, 2018TDR balances at September 30, 2017TDR loans in payment default during the three months ended September 30, 2017TDR loans in payment default during the nine months ended
September 30, 2017
Commercial and industrial$686
$—
$12
$394
$—
$7
$480
$—
$70
$686
$—
$12
Loans to financial institutions24
—
3
10
—
—
Financial institutions21
—
—
24
—
3
Mortgage and real estate84
—
—
80
—
—
71
—
—
84
—
—
Other155
—
—
291
—
—
42
—
—
155
—
—
Total(1)
$949
$—
$15
$775
$—
$7
$614
$—
$70
$949
$—
$15

(1)The above tables reflecttable reflects activity for loans outstanding that were considered TDRs as of the end of the reporting period that were considered TDRs.period.





14. ALLOWANCE FOR CREDIT LOSSES
 
Three Months Ended September 30,Nine Months Ended 
 September 30,		Three Months Ended September 30,Nine Months Ended 
 September 30,
In millions of dollars20172016201720162018201720182017
Allowance for loan losses at beginning of period$12,025
$12,304
$12,060
$12,626
$12,126
$12,025
$12,355
$12,060
Gross credit losses(2,120)(1,948)(6,394)(6,139)(2,094)(2,120)(6,499)(6,394)
Gross recoveries(1)
343
423
1,198
1,274
338
343
1,172
1,198
Net credit losses (NCLs)$(1,777)$(1,525)$(5,196)$(4,865)$(1,756)$(1,777)$(5,327)$(5,196)
NCLs$1,777
$1,525
$5,196
$4,865
$1,756
$1,777
$5,327
$5,196
Net reserve builds419
258
466
210
Net specific reserve releases(50)(37)(175)(53)
Net reserve builds (releases)169
419
302
466
Net specific reserve builds (releases)(19)(50)(125)(175)
Total provision for loan losses$2,146
$1,746
$5,487
$5,022
$1,906
$2,146
$5,504
$5,487
Other, net (see table below)(28)(86)15
(344)60
(28)(196)15
Allowance for loan losses at end of period$12,366
$12,439
$12,366
$12,439
$12,336
$12,366
$12,336
$12,366
Allowance for credit losses on unfunded lending commitments at beginning of period$1,406
$1,432
$1,418
$1,402
$1,278
$1,406
$1,258
$1,418
Release for unfunded lending commitments(175)(45)(190)(4)
Provision (release) for unfunded lending commitments42
(175)66
(190)
Other, net1
1
4
(10)1
1
(3)4
Allowance for credit losses on unfunded lending commitments at end of period(2)
$1,232
$1,388
$1,232
$1,388
$1,321
$1,232
$1,321
$1,232
Total allowance for loans, leases and unfunded lending commitments$13,598
$13,827
$13,598
$13,827
$13,657
$13,598
$13,657
$13,598

(1)Recoveries have been reduced by certain collection costs that are incurred only if collection efforts are successful.
(2)
Represents additional credit loss reserves for unfunded lending commitments and letters of credit recorded in Other liabilities on the Consolidated Balance Sheet.

Other, net detailsThree Months Ended September 30,Nine Months Ended 
 September 30,		Three Months Ended September 30,Nine Months Ended 
 September 30,
In millions of dollars20172016201720162018201720182017
Sales or transfers of various consumer loan portfolios to held-for-sale   
Sales or transfers of various consumer loan portfolios to HFS   
Transfer of real estate loan portfolios$(28)$(50)$(84)$(103)$(2)$(28)$(88)$(84)
Transfer of other loan portfolios(6)(8)(130)(204)(3)(6)(109)(130)
Sales or transfers of various consumer loan portfolios to held-for-sale$(34)$(58)$(214)$(307)
Sales or transfers of various consumer loan portfolios to HFS$(5)$(34)$(197)$(214)
FX translation, consumer7
(46)221
(58)62
7
16
221
Other(1)18
8
21
3
(1)(15)8
Other, net$(28)$(86)$15
$(344)$60
$(28)$(196)$15


Allowance for Credit Losses and Investment in Loans
Three Months EndedThree Months Ended
September 30, 2017September 30, 2016September 30, 2018September 30, 2017
In millions of dollarsCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotal
Allowance for loan losses at beginning of period$2,510
$9,515
$12,025
$2,872
$9,432
$12,304
$2,330
$9,796
$12,126
$2,510
$9,515
$12,025
Charge-offs(49)(2,071)(2,120)(63)(1,885)(1,948)(36)(2,058)(2,094)(49)(2,071)(2,120)
Recoveries6
337
343
23
400
423
6
332
338
6
337
343
Replenishment of net charge-offs43
1,734
1,777
40
1,485
1,525
30
1,726
1,756
43
1,734
1,777
Net reserve builds (releases)(60)479
419
(110)368
258
34
135
169
(60)479
419
Net specific reserve builds (releases)21
(71)(50)(1)(36)(37)(27)8
(19)21
(71)(50)
Other3
(31)(28)5
(91)(86)2
58
60
3
(31)(28)
Ending balance$2,474
$9,892
$12,366
$2,766
$9,673
$12,439
$2,339
$9,997
$12,336
$2,474
$9,892
$12,366



Nine Months EndedNine Months Ended
September 30, 2017September 30, 2016September 30, 2018September 30, 2017
In millions of dollarsCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotal
Allowance for loan losses at beginning of period$2,702
$9,358
$12,060
$2,791
$9,835
$12,626
$2,486
$9,869
$12,355
$2,702
$9,358
$12,060
Charge-offs(248)(6,146)(6,394)(445)(5,694)(6,139)(195)(6,304)(6,499)(248)(6,146)(6,394)
Recoveries91
1,107
1,198
52
1,222
1,274
71
1,101
1,172
91
1,107
1,198
Replenishment of net charge-offs157
5,039
5,196
393
4,472
4,865
124
5,203
5,327
157
5,039
5,196
Net reserve builds (releases)(230)696
466
(122)332
210
(15)317
302
(230)696
466
Net specific reserve builds (releases)(18)(157)(175)89
(142)(53)(119)(6)(125)(18)(157)(175)
Other20
(5)15
8
(352)(344)(13)(183)(196)20
(5)15
Ending balance$2,474
$9,892
$12,366
$2,766
$9,673
$12,439
$2,339
$9,997
$12,336
$2,474
$9,892
$12,366

September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollarsCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotalCorporateConsumerTotal
Allowance for loan losses 
 
 
    
 
 
   
Collectively evaluated in accordance with ASC 450$2,098
$8,550
$10,648
$2,310
$7,744
$10,054
$2,035
$8,820
$10,855
$2,060
$8,531
$10,591
Individually evaluated in accordance with ASC 310-10-35376
1,337
1,713
392
1,608
2,000
304
1,175
1,479
426
1,334
1,760
Purchased credit-impaired in accordance with ASC 310-30—
5
5
—
6
6
Purchased credit impaired in accordance with ASC 310-30—
2
2
—
4
4
Total allowance for loan losses$2,474
$9,892
$12,366
$2,702
$9,358
$12,060
$2,339
$9,997
$12,336
$2,486
$9,869
$12,355
Loans, net of unearned income     

      
Collectively evaluated in accordance with ASC 450$321,239
$318,615
$639,854
$293,294
$317,048
$610,342
$343,774
$319,816
$663,590
$327,142
$326,884
$654,026
Individually evaluated in accordance with ASC 310-10-352,087
6,757
8,844
2,555
7,799
10,354
1,448
5,501
6,949
1,887
6,580
8,467
Purchased credit-impaired in accordance with ASC 310-30—
177
177
—
187
187
Purchased credit impaired in accordance with ASC 310-30—
131
131
—
167
167
Held at fair value4,281
27
4,308
3,457
29
3,486
4,218
21
4,239
4,349
25
4,374
Total loans, net of unearned income$327,607
$325,576
$653,183
$299,306
$325,063
$624,369
$349,440
$325,469
$674,909
$333,378
$333,656
$667,034







15.   GOODWILL AND INTANGIBLE ASSETS
Goodwill
The changes in Goodwill were as follows:
In millions of dollarsGlobal Consumer BankingInstitutional Clients GroupCorporate/OtherTotal
Balance at December 31, 2017$12,784
$9,456
$16
$22,256
Foreign currency translation and other$184
$235
$—
$419
Divestiture(1)
—
—
(16)(16)
Balance at March 31, 2018$12,968
$9,691
$—
$22,659
Foreign exchange translation and other$(226)$(375)$—
$(601)
Balance at June 30, 2018$12,742
$9,316
$—
$22,058
Foreign exchange translation and other

$7
$122
$—
$129
Balance at September 30, 2018$12,749
$9,438
$—
$22,187

(1)
Goodwill allocated to the sale of the Citi Colombia consumer business, the only remaining business in Citi Holdings—Consumer Latin America reporting unit reported as part of Corporate/Other, which was classified as HFS beginning the first quarter of 2018. The sale was completed during the second quarter of 2018.

Goodwill impairment testing is performed at the level below each business segment (referred to as a reporting unit). See Note 3 for further information on business segments. For additional information regarding Citi’s goodwill impairment testing process, see Notes 1 and 16 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.

Goodwill
The changes in Goodwill were as follows:
In millions of dollars 
Balance, December 31, 2016$21,659
Foreign exchange translation and other$634
Impairment of goodwill (1)
(28)
Balance at March 31, 2017$22,265
Foreign exchange translation and other$156
Impairment of goodwill—
Divestitures (2)
(72)
Balance at June 30, 2017$22,349
Foreign exchange translation and other

$(4)
Balance at September 30, 2017$22,345

(1)
Full impairment of the allocated goodwill related to the transferred mortgage servicing business upon transfer from North America GCB to Citi Holdings—REL effective January 1, 2017.
(2)Goodwill allocated to the sale of the Fixed Income Analytics and Index businesses classified as held-for-sale during the second quarter of 2017. The sale was completed during the third quarter of 2017. See Note 2 to the Consolidated Financial Statements.
 
For additional information on transfer of goodwill and results of interim testing performed during the first half of 2017, see Note 15 in Citi’s Second Quarter of 2017 Form 10-Q.

The Company performed its annual goodwill impairment test as of July 1, 2017.2018. The fair values of the Company’s reporting units exceeded their carrying values by approximately 14% to 243% and did not indicate ano reporting unit is at risk of impairment, except for Citi Holdings—Consumer Latin America reporting unit.
Citi Holdings—Consumer Latin America reporting unit only marginally exceeded its carrying value. Whileimpairment. Further, there was no indication of impairment, the $16 million of goodwill present in Citi Holdings—Consumer Latin America may be particularly sensitive to further deterioration in economic conditions. The fair value as a percentage of allocated book value as of September 30, 2017 was 103%. There were no other triggering events identified and no goodwill was impaired during the third quarter of 2017.
The following table shows reporting units with goodwill balances as ofthree and nine months ended September 30, 2017 and the fair value as a percentage of allocated book value as of the 2017 annual goodwill impairment test:

In millions of dollars  
Reporting unitGoodwillFair value as a % of allocated book value
North America Global Consumer Banking$6,732
157%
Asia Global Consumer Banking 
4,893
143
Latin America Global Consumer Banking1,174
191
ICG—Banking
2,986
268
ICG—Markets and Securities Services
6,544
132
Citi Holdings—Consumer Latin America(1)
16
103
Total as of September 30, 2017$22,345



(1)
All Citi Holdings reporting units are presented in the Corporate/Other segment beginning in the first quarter of 2017.








2018.


Intangible Assets
The components of intangible assets were as follows:
 September 30, 2017December 31, 2016
In millions of dollars
Gross
carrying
amount
Accumulated
amortization
Net
carrying
amount
Gross
carrying
amount
Accumulated
amortization
Net
carrying
amount
Purchased credit card relationships$5,377
$3,798
$1,579
$8,215
$6,549
$1,666
Credit card contract related intangibles(1)
5,045
2,357
2,688
5,149
2,177
2,972
Core deposit intangibles670
656
14
801
771
30
Other customer relationships462
269
193
474
272
202
Present value of future profits35
31
4
31
27
4
Indefinite-lived intangible assets232
—
232
210
—
210
Other113
91
22
504
474
30
Intangible assets (excluding MSRs)$11,934
$7,202
$4,732
$15,384
$10,270
$5,114
Mortgage servicing rights (MSRs)(2)
553
—
553
1,564
—
1,564
Total intangible assets$12,487
$7,202
$5,285
$16,948
$10,270
$6,678


The changes in intangible assets were as follows:
Net carrying
amount at		 
Net carrying
amount at
September 30, 2018December 31, 2017
In millions of dollarsDecember 31,
2016
Acquisitions/
divestitures
AmortizationFX translation and otherSeptember 30,
2017
Gross
carrying
amount
Accumulated
amortization
Net
carrying
amount
Gross
carrying
amount
Accumulated
amortization
Net
carrying
amount
Purchased credit card relationships$1,666
$20
$(109)$2
$1,579
$5,732
$3,890
$1,842
$5,375
$3,836
$1,539
Credit card contract related intangibles(1)
2,972
9
(295)2
2,688
5,042
2,708
2,334
5,045
2,456
2,589
Core deposit intangibles30
—
(18)2
14
438
433
5
639
628
11
Other customer relationships202
—
(17)8
193
463
289
174
459
272
187
Present value of future profits4
—
—
—
4
34
30
4
32
28
4
Indefinite-lived intangible assets210
—
—
22
232
227
—
227
244
—
244
Other30
(14)(11)17
22
84
72
12
100
86
14
Intangible assets (excluding MSRs)$5,114
$15
$(450)$53
$4,732
$12,020
$7,422
$4,598
$11,894
$7,306
$4,588
Mortgage servicing rights (MSRs)(2)
1,564
 553
618
—
618
558
—
558
Total intangible assets$6,678
 $5,285
$12,638
$7,422
$5,216
$12,452
$7,306
$5,146
(1)Primarily reflects contract-related intangibles associated with the American Airlines, Sears, The Home Depot, Costco, Sears and AT&T credit card program agreements, which represented 97% of the aggregate net carrying amount as of September 30, 2018.
(2)For additional information on Citi’s MSRs, see Note 18 to the Consolidated Financial Statements.


The changes in intangible assets were as follows:
 Net carrying
amount at		   
Net carrying
amount at
In millions of dollarsDecember 31,
2017
Acquisitions/
divestitures
AmortizationFX translation and otherSeptember 30,
2018
Purchased credit card relationships(1)
$1,539
$429
$(124)$(2)$1,842
Credit card contract related intangibles(2)
2,589
—
(255)—
2,334
Core deposit intangibles11
—
(6)—
5
Other customer relationships187
—
(19)6
174
Present value of future profits4
—
—
—
4
Indefinite-lived intangible assets244
—
—
(17)227
Other14
—
(9)7
12
Intangible assets (excluding MSRs)$4,588
$429
$(413)$(6)$4,598
Mortgage servicing rights (MSRs)(3)
558
   618
Total intangible assets$5,146
   $5,216
(1)Reflects intangibles for the value of cardholder relationships, which are discrete from partner contract intangibles and include credit card accounts primarily in the Costco, Macy’s and Sears portfolios. The increase since December 31, 2017 reflects the purchase of certain rights related to credit card accounts in the Sears portfolio.
(2)Primarily reflects contract-related intangibles associated with the American Airlines, The Home Depot, Costco, Sears and AT&T credit card program agreements, which represented 97% of the aggregate net carrying amount at September 30, 20172018 and December 31, 2016.2017.
(2)(3)For additional information on Citi’s MSRs, including the rollforward for the nine months ended September 30, 2017,2018, see Note 18 to the Consolidated Financial Statements.



16.   DEBT
For additional information regarding Citi’s short-term borrowings and long-term debt, see Note 17 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.

Short-Term Borrowings
In millions of dollarsSeptember 30,
2017		December 31,
2016		September 30,
2018		December 31,
2017
Commercial paper$10,033
$9,989
$12,051
$9,940
Other borrowings(1)
28,116
20,712
21,719
34,512
Total$38,149
$30,701
$33,770
$44,452

(1)Includes borrowings from Federal Home Loan Banks and other market participants. At September 30, 20172018 and December 31, 2016,2017, collateralized short-term advances from the Federal Home Loan Banks were $16.6$10.5 billion and $12.0$23.8 billion, respectively.

 

Long-Term Debt
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2018		December 31, 2017
Citigroup Inc.(1)
$151,914
$147,333
$148,183
$152,163
Bank(2)
62,078
49,454
62,085
65,856
Broker-dealer and other(3)
18,681
9,391
25,002
18,690
Total$232,673
$206,178
$235,270
$236,709

(1)Represents the parent holding company.
(2)Represents Citibank entities as well as other bank entities. At September 30, 20172018 and December 31, 2016,2017, collateralized long-term advances from the Federal Home Loan Banks were $19.8$10.5 billion and $21.6$19.3 billion, respectively.
(3)Represents broker-dealer and other non-bank subsidiaries that are consolidated into Citigroup Inc., the parent holding company.

Long-term debt outstanding includes trust preferred securities with a balance sheet carrying value of $1.7 billion at both September 30, 20172018 and December 31, 2016.2017.


The following table summarizes Citi’s outstanding trust preferred securities at September 30, 2017:2018:
    Junior subordinated debentures owned by trust    Junior subordinated debentures owned by trust
Trust
Issuance
date
Securities
issued
Liquidation
value(1)
Coupon
rate(2)
Common
shares
issued
to parent
AmountMaturity
Redeemable
by issuer
beginning
Issuance
date
Securities
issued
Liquidation
value(1)
Coupon
rate(2)
Common
shares
issued
to parent
AmountMaturity
Redeemable
by issuer
beginning
In millions of dollars, except share amounts
In millions of dollars, except share amounts








In millions of dollars, except share amounts








Citigroup Capital IIIDec. 1996194,053
$194
7.625%6,003
$200
Dec. 1, 2036Not redeemableDec. 1996194,053
$194
7.625%6,003
$200
Dec. 1, 2036Not redeemable
Citigroup Capital XIIISept. 201089,840,000
2,246
3 mo LIBOR + 637 bps
1,000
2,246
Oct. 30, 2040Oct. 30, 2015Sept. 201089,840,000
2,246
3 mo LIBOR + 637 bps
1,000
2,246
Oct. 30, 2040Oct. 30, 2015
Citigroup Capital XVIIIJune 200799,901
134
3 mo LIBOR + 88.75 bps
50
134
June 28, 2067June 28, 2017Jun. 200799,901
130
3 mo LIBOR + 88.75 bps
50
130
Jun. 28, 2067June 28, 2017
Total obligated  
$2,574
  $2,580
   
$2,570
  $2,576
 

Note: Distributions on the trust preferred securities and interest on the subordinated debentures are payable semiannually for Citigroup Capital III and Citigroup Capital XVIII and quarterly for Citigroup Capital XIII.
(1)Represents the notional value received by outside investors from the trusts at the time of issuance.
(2)In each case, the coupon rate on the subordinated debentures is the same as that on the trust preferred securities.


17.   CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (AOCI)
Changes in each component of Citigroup’s Accumulated other comprehensive income (loss) were as follows:
Three Months Ended September 30, 20172018
In millions of dollarsNet
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Accumulated
other
comprehensive income (loss)		Net
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Excluded component of fair value hedges(4)
Accumulated
other
comprehensive income (loss)
Balance, June 30, 2017$(102)$(496)$(445)$(5,311)$(23,545)$(29,899)
Balance, June 30, 2018$(2,717)$(475)$(1,021)$(5,794)$(27,455)$(32)$(37,494)
Other comprehensive income before reclassifications60
(125)(27)(71)218
55
(601)(294)(114)(14)(221)10
(1,234)
Increase (decrease) due to amounts reclassified from AOCI(126)2
35
42
—
(47)(4)7
40
40
—
—
83
Change, net of taxes$(66)$(123)$8
$(29)$218
$8
$(605)$(287)$(74)$26
$(221)$10
$(1,151)
Balance at September 30, 2017$(168)$(619)$(437)$(5,340)$(23,327)$(29,891)
Balance at September 30, 2018$(3,322)$(762)$(1,095)$(5,768)$(27,676)$(22)$(38,645)
Nine Months Ended September 30, 20172018
In millions of dollarsNet
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Accumulated
other
comprehensive income (loss)		Net
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Excluded component of fair value hedges(4)
Accumulated
other
comprehensive income (loss)
Balance, December 31, 2016$(799)$(352)$(560)$(5,164)$(25,506)$(32,381)
Balance, December 31, 2017$(1,158)$(921)$(698)$(6,183)$(25,708)$—
$(34,668)
Adjustment to opening balance, net of taxes(4)(5)
504
—
—
—
—
504
(3)—
—
—
—
—
(3)
Adjusted balance, beginning of period$(295)$(352)$(560)$(5,164)$(25,506)$(31,877)$(1,161)$(921)$(698)$(6,183)$(25,708)$—
$(34,671)
Other comprehensive income before reclassifications495
(259)59
(293)2,326
2,328
(1,984)123
(393)288
(1,968)(22)(3,956)
Increase (decrease) due to amounts reclassified from AOCI(368)(8)64
117
(147)(342)(177)36
(4)127
—
—
(18)
Change, net of taxes
$127
$(267)$123
$(176)$2,179
$1,986
$(2,161)$159
$(397)$415
$(1,968)$(22)$(3,974)
Balance at September 30, 2017$(168)$(619)$(437)$(5,340)$(23,327)$(29,891)
Balance, September 30, 2018$(3,322)$(762)$(1,095)$(5,768)$(27,676)$(22)$(38,645)
Note: Footnotes to the tables above appear on the following page.


Three Months Ended September 30, 20162017
In millions of dollarsNet
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit
plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Accumulated
other
comprehensive income (loss)		Net
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Excluded component of fair value hedges(4)
Accumulated
other
comprehensive income (loss)
Balance, June 30, 2016$2,054
$190
$(149)$(5,608)$(22,602)$(26,115)
Balance, June 30, 2017$(102)$(496)$(445)$(5,311)$(23,545)$—
$(29,899)
Other comprehensive income before reclassifications(270)(197)(136)(28)(375)(1,006)60
(125)(27)(71)218
—
55
Increase (decrease) due to amounts reclassified from AOCI(162)(3)53
40
—
(72)(126)2
35
42
—
—
(47)
Change, net of taxes
$(432)$(200)$(83)$12
$(375)$(1,078)$(66)$(123)$8
$(29)$218
$—
$8
Balance, September 30, 2016$1,622
$(10)$(232)$(5,596)$(22,977)$(27,193)
Balance, September 30, 2017$(168)$(619)$(437)$(5,340)$(23,327)$—
$(29,891)

Nine Months Ended September 30, 20162017
In millions of dollarsNet
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Accumulated
other
comprehensive income (loss)		Net
unrealized
gains (losses)
on investment securities		Debt valuation adjustment (DVA)
Cash flow hedges(1)
Benefit plans(2)
Foreign
currency
translation
adjustment (CTA), net of hedges(3)
Excluded component of fair value hedges(4)
Accumulated
other
comprehensive income (loss)
Balance, December 31, 2015$(907)$—
$(617)$(5,116)$(22,704)$(29,344)
Balance, December 31, 2016$(799)$(352)$(560)$(5,164)$(25,506)$—
$(32,381)
Adjustment to opening balance, net of taxes (5)(6)
—
(15)—
—
—
(15)504
—
—
—
—
—
504
Adjusted balance, beginning of period$(907)$(15)$(617)$(5,116)$(22,704)$(29,359)$(295)$(352)$(560)$(5,164)$(25,506)$—
$(31,877)
Other comprehensive income before reclassifications2,781
11
270
(594)(273)2,195
495
(259)59
(293)2,326
—
2,328
Increase (decrease) due to amounts reclassified from AOCI(252)(6)115
114
—
(29)(368)(8)64
117
(147)—
(342)
Change, net of taxes$2,529
$5
$385
$(480)$(273)$2,166
$127
$(267)$123
$(176)$2,179
$—
$1,986
Balance, September 30, 2016$1,622
$(10)$(232)$(5,596)$(22,977)$(27,193)
Balance, September 30, 2017$(168)$(619)$(437)$(5,340)$(23,327)$—
$(29,891)
(1)Primarily driven by Citigroup’s pay fixed/receive floating interest rate swap programs that hedge the floating rates on liabilities.
(2)Primarily reflects adjustments based on the quarterly actuarial valuations of the Company’s Significantsignificant pension and postretirement plans, annual actuarial valuations of all other plans and amortization of amounts previously recognized in other comprehensive income.
(3)Primarily reflects the movements in (by order of impact) the Indian rupee, Chinese yuan renminbi, Turkish lira and Brazilian real against the U.S. dollar and changes in related tax effects and hedges for the three months ended September 30, 2018. Primarily reflects the movements in (by order of impact) the Brazilian real, Indian rupee, Australian dollar, and Argentine peso against the U.S. dollar and changes in related tax effects and hedges for the nine months ended September 30, 2018. Primarily reflects the movements in (by order of impact) the Euro, British pound, Chilean peso and Brazilian real against the U.S. dollar and changes in related tax effects and hedges for the quarterthree months ended September 30, 2017. Primarily reflects the movements in (by order of impact) the Mexican peso, Euro, Korean won and Polish zloty against the U.S. dollar and changes in related tax effects and hedges for the quarter nine months ended September 30, 2017. Primarily reflectsAmounts recorded in the movementsCTA component of AOCI remain in (by orderAOCI until the sale or substantial liquidation of impact) the Mexican peso, Korean won, Japanese yen, and Australian dollar forforeign entity, at which point such amounts related to the quarter ended September 30, 2016. Primarily reflects the movements in (by order of impact) the Mexican peso, Japanese yen, Brazilian real and Korean won against the U.S. dollar, and changes in related tax effects and hedges for the quarter and nine months ended September 30, 2016.foreign entity are reclassified into earnings.
(4)
Beginning in the first quarter of 2018, changes in the excluded component of fair value hedges are reflected as a component of AOCI, pursuant to the early adoption of ASU No. 2017-12, Targeted Improvements to Accounting for Hedging Activities. See Note 1 to the Consolidated Financial Statements for further information regarding this change.
(5)
Citi adopted ASU 2016-01 and ASU 2018-03 on January 1, 2018. Upon adoption, a cumulative effect adjustment was recorded from AOCI to Retained earnings for net unrealized gains on former AFS equity securities. For additional information, see Note 1 to the Consolidated Financial Statements.
(6)
In the second quarter of 2017, Citi early adopted ASU 2017-08, Receivables-NonrefundableReceivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. Upon adoption, a cumulative effect adjustment was recorded to reduce retainedRetained earnings effective January 1, 2017, for the incremental amortization of cumulative fair value hedge adjustments on callable state and municipal debt securities.  For additional information, see Note 1 to the Consolidated Financial Statements.
(5)Beginning in the first quarter of 2016, changes in DVA are reflected as a component of AOCI, pursuant to the early adoption of only the provisions of ASU 2016-01 relating to the presentation of DVA on fair value option liabilities. See Note 1 to the Consolidated Financial Statements for further information regarding this change.



The pretax and after-tax changes in each component of Accumulated other comprehensive income (loss) were as follows:
Three Months Ended September 30, 2017
In millions of dollarsPretaxTax effectAfter-tax
Balance, June 30, 2017$(39,106)$9,207
$(29,899)
Change in net unrealized gains (losses) on investment securities(107)41
(66)
Debt valuation adjustment (DVA)(195)72
(123)
Cash flow hedges12
(4)8
Benefit plans(45)16
(29)
Foreign currency translation adjustment285
(67)218
Change$(50)$58
$8
Balance, September 30, 2017$(39,156)$9,265
$(29,891)

Nine Months Ended September 30, 2017
In millions of dollarsPretaxTax effectAfter-tax
Balance, December 31, 2016$(42,035)$9,654
$(32,381)
Adjustment to opening balance (1)
803
(299)504
Adjusted balance, beginning of period$(41,232)$9,355
$(31,877)
Change in net unrealized gains (losses) on investment securities194
(67)127
Debt valuation adjustment (DVA)(422)155
(267)
Cash flow hedges198
(75)123
Benefit plans(266)90
(176)
Foreign currency translation adjustment2,372
(193)2,179
Change$2,076
$(90)$1,986
Balance, September 30, 2017$(39,156)$9,265
$(29,891)
(1)
In the second quarter of 2017, Citi early adopted ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities.  Upon adoption, a cumulative effect adjustment was recorded to reduce retained earnings,, effective January 1, 2017, for the incremental amortization of cumulative fair value hedge adjustments on callable state and municipal debt securities. For additional information, see Note 1 to the Consolidated Financial Statements.



The pretax and after-tax changes in each component of Accumulated other comprehensive income (loss) were as follows:
Three Months Ended September 30, 20162018
In millions of dollarsPretaxTax effectAfter-taxPretax
Tax effect(1)
After-tax
Balance, June 30, 2016$(33,714)$7,599
$(26,115)
Change in net unrealized gains (losses) on investment securities(686)254
(432)
Balance, June 30, 2018$(44,407)$6,913
$(37,494)
Change in net unrealized gains (losses) on AFS debt securities(810)205
(605)
Debt valuation adjustment (DVA)(319)119
(200)(377)90
(287)
Cash flow hedges(131)48
(83)(97)23
(74)
Benefit plans11
1
12
55
(29)26
Foreign currency translation adjustment(313)(62)(375)(192)(29)(221)
Excluded component of fair value hedges13
(3)10
Change$(1,438)$360
$(1,078)$(1,408)$257
$(1,151)
Balance, September 30, 2016$(35,152)$7,959
$(27,193)
Balance, September 30, 2018$(45,815)$7,170
$(38,645)
Nine Months Ended September 30, 20162018
In millions of dollarsPretaxTax effectAfter-taxPretax
Tax effect(1)
After-tax
Balance, December 31, 2015$(38,440)$9,096
$(29,344)
Balance, December 31, 2017(1)
$(41,228)$6,560
$(34,668)
Adjustment to opening balance (1)(2)
(26)11
(15)(4)1
(3)
Adjusted balance, beginning of period$(38,466)$9,107
$(29,359)$(41,232)$6,561
$(34,671)
Change in net unrealized gains (losses) on investment securities4,020
(1,491)2,529
(2,861)700
(2,161)
Debt valuation adjustment (DVA)8
(3)5
208
(49)159
Cash flow hedges607
(222)385
(519)122
(397)
Benefit plans(747)267
(480)549
(134)415
Foreign currency translation adjustment(574)301
(273)(1,931)(37)(1,968)
Excluded component of fair value hedges(29)7
(22)
Change$3,314
$(1,148)$2,166
$(4,583)$609
$(3,974)
Balance, September 30, 2016$(35,152)$7,959
$(27,193)
Balance, September 30, 2018$(45,815)$7,170
$(38,645)
(1)Represents
Includes the ($15) million adjustment relatedimpact of ASU 2018-02, which transferred amounts from AOCI to Retained earnings. For additional information, see Note 19 to the initialConsolidated Financial Statements in Citi’s 2017 Annual Report on Form 10-K.
(2)
Citi adopted ASU 2016-01 and ASU 2018-03 on January 1, 2018. Upon adoption, a cumulative effect adjustment was recorded from AOCI to Retained earnings for net unrealized gains on former AFS equity securities. For additional information, see Note 1 to the Consolidated Financial Statements.



Three Months Ended September 30, 2017
In millions of dollarsPretaxTax effectAfter-tax
Balance, June 30, 2017$(39,106)$9,207
$(29,899)
Change in net unrealized gains (losses) on investment securities(107)41
(66)
Debt valuation adjustment (DVA)(195)72
(123)
Cash flow hedges12
(4)8
Benefit plans(45)16
(29)
Foreign currency translation adjustment285
(67)218
Excluded component of fair value hedges—
—
—
Change$(50)$58
$8
Balance, September 30, 2017$(39,156)$9,265
$(29,891)

Nine Months Ended September 30, 2017
In millions of dollarsPretaxTax effectAfter-tax
Balance, December 31, 2016$(42,035)$9,654
$(32,381)
Adjustment to opening balance(1)
803
(299)504
Adjusted balance, beginning of period$(41,232)$9,355
$(31,877)
Change in net unrealized gains (losses) on investment securities194
(67)127
Debt valuation adjustment (DVA)(422)155
(267)
Cash flow hedges198
(75)123
Benefit plans(266)90
(176)
Foreign currency translation adjustment2,372
(193)2,179
Excluded component of fair value hedges—
—
—
Change$2,076
$(90)$1,986
Balance, September 30, 2017$(39,156)$9,265
$(29,891)
(1)
In the second quarter of 2017, Citi early adopted ASU 2016-01.2017-08. Upon adoption, a cumulative effect adjustment was recorded to reduce Retained earnings, effective January 1, 2017, for the incremental amortization of cumulative fair value hedge adjustments on callable state and municipal debt securities. See Note 1 to the Consolidated Financial Statements.







The Company recognized pretax gain (loss)gains (losses) related to amounts in AOCI reclassified to the Consolidated Statement of Income as follows:
Increase (decrease) in AOCI due to amounts reclassified to Consolidated Statement of Income
Increase (decrease) in AOCI due to
amounts reclassified to
Consolidated Statement of Income
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201720182018
Realized (gains) losses on sales of investments$(213)$(626)$(69)$(341)
OTTI gross impairment losses15
47
Gross impairment losses68
111
Subtotal, pretax$(198)$(579)$(1)$(230)
Tax effect72
211
(3)53
Net realized (gains) losses on investment securities, after-tax(1)
$(126)$(368)
Net realized (gains) losses on investments after-tax(1)
$(4)$(177)
Realized DVA (gains) losses on fair value option liabilities$3
$(13)$9
$46
Subtotal, pretax$3
$(13)$9
$46
Tax effect(1)5
(2)(10)
Net realized debt valuation adjustment, after-tax$2
$(8)$7
$36
Interest rate contracts$48
$94
$54
$3
Foreign exchange contracts7
8
(2)(8)
Subtotal, pretax$55
$102
$52
$(5)
Tax effect(20)(38)(12)1
Amortization of cash flow hedges, after-tax(2)
$35
$64
$40
$(4)
Amortization of unrecognized    
Prior service cost (benefit)$(10)$(32)$(10)$(32)
Net actuarial loss70
203
60
193
Curtailment/settlement impact(3)
5
12
—
6
Subtotal, pretax$65
$183
$50
$167
Tax effect(23)(66)(10)(40)
Amortization of benefit plans, after-tax(3)
$42
$117
$40
$127
Foreign currency translation adjustment$—
$(232)$—
$—
Tax effect—
85
—
—
Foreign currency translation adjustment$—
$(147)$—
$—
Total amounts reclassified out of AOCI, pretax$(75)$(539)$110
$(22)
Total tax effect28
197
(27)4
Total amounts reclassified out of AOCI, after-tax$(47)$(342)$83
$(18)
(1)
The pretax amount is reclassified to Realized gains (losses) on sales of investments, net and Gross impairment losses in the Consolidated Statement of Income. See Note 12 to the Consolidated Financial Statements for additional details.
(2)See Note 19 to the Consolidated Financial Statements for additional details.
(3)See Note 8 to the Consolidated Financial Statements for additional details.


The Company recognized pretax gains (losses) related to amounts in AOCI reclassified to the Consolidated Statement of Income as follows:
 
Increase (decrease) in AOCI due to
amounts reclassified to
Consolidated Statement of Income
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172017
Realized (gains) losses on sales of investments$(213)$(626)
OTTI gross impairment losses15
47
Subtotal, pretax$(198)$(579)
Tax effect72
211
Net realized (gains) losses on investment securities, after-tax(1)
$(126)$(368)
Realized DVA (gains) losses on fair value option liabilities$3
$(13)
Subtotal, pretax$3
$(13)
Tax effect$(1)$5
Net realized debt valuation adjustment, after-tax$2
$(8)
Interest rate contracts$48
$94
Foreign exchange contracts7
8
Subtotal, pretax$55
$102
Tax effect(20)(38)
Amortization of cash flow hedges, after-tax(2)
$35
$64
Amortization of unrecognized  
Prior service cost (benefit)$(10)$(32)
Net actuarial loss70
203
Curtailment/settlement impact(3)
5
12
Subtotal, pretax$65
$183
Tax effect(23)(66)
Amortization of benefit plans, after-tax(3)
$42
$117
Foreign currency translation adjustment$—
$(232)
Tax effect—
85
Foreign currency translation adjustment$—
$(147)
Total amounts reclassified out of AOCI, pretax$(75)$(539)
Total tax effect28
197
Total amounts reclassified out of AOCI, after-tax$(47)$(342)

(1)
The pretax amount is reclassified to Realized gains (losses) on sales of investments, net and Gross impairment losses on the Consolidated Statement of Income. See Note 12 to the Consolidated Financial Statements for additional details.
(2)See Note 19 to the Consolidated Financial Statements for additional details.
(3)See Note 8 to the Consolidated Financial Statements for additional details.


The Company recognized pretax gain (loss) related to amounts in AOCI reclassified to the Consolidated Statement of Income as follows:
 Increase (decrease) in AOCI due to amounts reclassified to Consolidated Statement of Income
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20162016
Realized (gains) losses on sales of investments$(287)$(673)
OTTI gross impairment losses32
283
Subtotal, pretax$(255)$(390)
Tax effect93
138
Net realized (gains) losses on investment securities, after-tax(1)
$(162)$(252)
Realized DVA (gains) losses on fair value option liabilities$(5)$(10)
Subtotal, pretax$(5)$(10)
Tax effect$2
$4
Net realized debt valuation adjustment, after-tax$(3)$(6)
Interest rate contracts$39
$96
Foreign exchange contracts46
89
Subtotal, pretax$85
$185
Tax effect(32)(70)
Amortization of cash flow hedges, after-tax(2)
$53
$115
Amortization of unrecognized  
Prior service cost (benefit)$(10)$(31)
Net actuarial loss73
208
Curtailment/settlement impact(3)
8
9
Subtotal, pretax$71
$186
Tax effect(31)(72)
Amortization of benefit plans, after-tax(3)
$40
$114
Foreign currency translation adjustment$—
$—
Total amounts reclassified out of AOCI, pretax$(104)$(29)
Total tax effect32
—
Total amounts reclassified out of AOCI, after-tax$(72)$(29)

(1)
The pretax amount is reclassified to Realized gains (losses) on sales of investments, net and Gross impairment losses on the Consolidated Statement of Income. See Note 12 to the Consolidated Financial Statements for additional details.
(2)See Note 19 to the Consolidated Financial Statements for additional details.
(3)See Note 8 to the Consolidated Financial Statements for additional details.



18. SECURITIZATIONS AND VARIABLE INTEREST ENTITIES

For additional information regarding Citi’s use of special purpose entities (SPEs) and variable interest entities (VIEs), see Note 21 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
Citigroup’s involvement with consolidated and unconsolidated VIEs with which the Company holds significant variable interests or has continuing involvement through servicing a majority of the assets in a VIE is presented below:
As of September 30, 2017As of September 30, 2018
 
Maximum exposure to loss in significant unconsolidated VIEs(1)
 
Maximum exposure to loss in significant unconsolidated VIEs(1)
 
Funded exposures(2)
Unfunded exposures  
Funded exposures(2)
Unfunded exposures 
In millions of dollars
Total
involvement
with SPE
assets
Consolidated
VIE / SPE assets
Significant
unconsolidated
VIE assets(3)
Debt
investments
Equity
investments
Funding
commitments
Guarantees
and
derivatives
Total
Total
involvement
with SPE
assets
Consolidated
VIE/SPE assets
Significant
unconsolidated
VIE assets(3)
Debt
investments
Equity
investments
Funding
commitments
Guarantees
and
derivatives
Total
Credit card securitizations$49,739
$49,739
$—
$—
$—
$—
$—
$—
$45,319
$45,319
$—
$—
$—
$—
$—
$—
Mortgage securitizations(4)
    
U.S. agency-sponsored(5)
116,257
—
116,257
2,528
—
—
63
2,591
113,565
—
113,565
2,965
—
—
68
3,033
Non-agency-sponsored21,123
932
20,191
280
36
—
1
317
25,452
1,580
23,872
356
—
—
1
357
Citi-administered asset-backed commercial paper conduits (ABCP)19,298
19,298
—
—
—
—
—
—
17,435
17,435
—
—
—
—
—
—
Collateralized loan obligations (CLOs)19,182
—
19,182
5,690
—
—
9
5,699
17,870
—
17,870
5,524
—
—
9
5,533
Asset-based financing51,393
672
50,721
15,412
599
5,016
—
21,027
64,817
639
64,178
20,060
601
9,214
—
29,875
Municipal securities tender option bond trusts (TOBs)6,777
2,178
4,599
13
—
3,063
—
3,076
8,016
2,029
5,987
37
—
4,106
—
4,143
Municipal investments17,830
11
17,819
2,627
3,855
2,345
—
8,827
17,765
1
17,764
2,622
3,798
2,268
—
8,688
Client intermediation2,664
1,131
1,533
782
—
491
6
1,279
592
419
173
72
—
—
9
81
Investment funds2,058
762
1,296
28
8
15
2
53
1,353
525
828
12
—
3
5
20
Other943
33
910
133
9
38
47
227
652
31
621
39
8
22
46
115
Total$307,264
$74,756
$232,508
$27,493
$4,507
$10,968
$128
$43,096
$312,836
$67,978
$244,858
$31,687
$4,407
$15,613
$138
$51,845
As of December 31, 2016As of December 31, 2017
 
Maximum exposure to loss in significant unconsolidated VIEs(1)
 
Maximum exposure to loss in significant unconsolidated VIEs(1)
 
Funded exposures(2)
Unfunded exposures  
Funded exposures(2)
Unfunded exposures 
In millions of dollars
Total
involvement
with SPE
assets
Consolidated
VIE / SPE assets
Significant
unconsolidated
VIE assets(3)
Debt
investments
Equity
investments
Funding
commitments
Guarantees
and
derivatives
Total
Total
involvement
with SPE
assets
Consolidated
VIE/SPE assets
Significant
unconsolidated
VIE assets(3)
Debt
investments
Equity
investments
Funding
commitments
Guarantees
and
derivatives
Total
Credit card securitizations$50,171
$50,171
$—
$—
$—
$—
$—
$—
$50,795
$50,795
$—
$—
$—
$—
$—
$—
Mortgage securitizations(4)
    
U.S. agency-sponsored214,458
—
214,458
3,852
—
—
78
3,930
116,610
—
116,610
2,647
—
—
74
2,721
Non-agency-sponsored15,965
1,092
14,873
312
35
—
1
348
22,251
2,035
20,216
330
—
—
1
331
Citi-administered asset-backed commercial paper conduits (ABCP)19,693
19,693
—
—
—
—
—
—
19,282
19,282
—
—
—
—
—
—
Collateralized loan obligations (CLOs)18,886
—
18,886
5,128
—
—
62
5,190
20,588
—
20,588
5,956
—
—
9
5,965
Asset-based financing53,168
733
52,435
16,553
475
4,915
—
21,943
60,472
633
59,839
19,478
583
5,878
—
25,939
Municipal securities tender option bond trusts (TOBs)7,070
2,843
4,227
40
—
2,842
—
2,882
6,925
2,166
4,759
138
—
3,035
—
3,173
Municipal investments17,679
14
17,665
2,441
3,578
2,580
—
8,599
19,119
7
19,112
2,709
3,640
2,344
—
8,693
Client intermediation515
371
144
49
—
—
3
52
958
824
134
32
—
—
9
41
Investment funds2,788
767
2,021
32
120
27
3
182
1,892
616
1,276
14
7
13
—
34
Other1,429
607
822
116
11
58
43
228
677
36
641
27
9
34
47
117
Total$401,822
$76,291
$325,531
$28,523
$4,219
$10,422
$190
$43,354
$319,569
$76,394
$243,175
$31,331
$4,239
$11,304
$140
$47,014

(1)    The definition of maximum exposure to loss is included in the text that follows this table.
(2)Included on Citigroup’s September 30, 20172018 and December 31, 20162017 Consolidated Balance Sheet.
(3)A significant unconsolidated VIE is an entity wherein which the Company has any variable interest or continuing involvement considered to be significant, regardless of the likelihood of loss.
(4)Citigroup mortgage securitizations also include agency and non-agency (private-label) re-securitization activities. These SPEs are not consolidated. See “Re-securitizations” below for further discussion.
(5)See Note 2 to the Consolidated Financial Statements for more information on the exit of the U.S. mortgage servicing operations and sale of MSRs.


The previous tables do not include:

certain venture capital investments made by some of the Company’s private equity subsidiaries, as the Company accounts for these investments in accordance with the Investment Company Audit Guide (codified in ASC 946);
certain investment funds for which the Company provides investment management services and personal estate trusts for which the Company provides administrative, trustee and/or investment management services;
certain VIEs structured by third parties wherein which the Company holds securities in inventory, as these investments are made on arm’s-length terms;
certain positions in mortgage-backed and asset-backed securities held by the Company, which are classified as Trading account assets or Investments, wherein which the Company has no other involvement with the related securitization entity deemed to be significant (for more information on these positions, see Notes 12 and 20 to the Consolidated Financial Statements);
certain representations and warranties exposures in legacy ICG-sponsored mortgage-backed and asset-backed securitizations wherein which the Company has no variable interest or continuing involvement as servicer. The outstanding balance of mortgage loans securitized during 2005 to 2008 wherein which the Company has no variable interest or continuing involvement as servicer was approximately $9$8 billion and $10$9 billion at September 30, 20172018 and December 31, 2016,2017, respectively;
certain representations and warranties exposures in Citigroup residential mortgage securitizations, where the original mortgage loan balances are no longer outstanding; and
VIEs such as trust preferred securities trusts used in connection with the Company’s funding activities. The Company does not have a variable interest in these trusts.

 

The asset balances for consolidated VIEs represent the carrying amounts of the assets consolidated by the Company. The carrying amount may represent the amortized cost or the current fair value of the assets depending on the legal form of the asset (e.g., loan or security) and the Company’s standard accounting policies for the asset type and line of business.
The asset balances for unconsolidated VIEs wherein which the Company has significant involvement represent the most current information available to the Company. In most cases, the asset balances represent an amortized cost basis without regard to impairments, unless fair value information is readily available to the Company.
The maximum funded exposure represents the balance sheet carrying amount of the Company’s investment in the VIE. It reflects the initial amount of cash invested in the VIE, adjusted for any accrued interest and cash principal payments received. The carrying amount may also be adjusted for increases or declines in fair value or any impairment in value recognized in earnings. The maximum exposure of unfunded positions represents the remaining undrawn committed amount, including liquidity and credit facilities provided by the Company or the notional amount of a derivative instrument considered to be a variable interest. In certain transactions, the Company has entered into derivative instruments or other arrangements that are not considered variable interests in the VIE (e.g., interest rate swaps, cross-currency swaps or where the Company is the purchaser of credit protection under a credit default swap or total return swap where the Company pays the total return on certain assets to the SPE). Receivables under such arrangements are not included in the maximum exposure amounts.


Funding Commitments for Significant Unconsolidated VIEs—Liquidity Facilities and Loan Commitments
The following table presents the notional amount of liquidity facilities and loan commitments that are classified as funding commitments in the VIE tables above:
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollars
Liquidity
facilities
Loan/equity
commitments
Liquidity
facilities
Loan/equity
commitments
Liquidity
facilities
Loan/equity
commitments
Liquidity
facilities
Loan/equity
commitments
Asset-based financing$—
$5,016
$5
$4,910
$—
$9,214
$—
$5,878
Municipal securities tender option bond trusts (TOBs)3,063
—
2,842
—
4,106
—
3,035
—
Municipal investments—
2,345
—
2,580
—
2,268
—
2,344
Client intermediation—
491
—
—
Investment funds—
15
—
27
—
3
—
13
Other—
38
—
58
—
22
—
34
Total funding commitments$3,063
$7,905
$2,847
$7,575
$4,106
$11,507
$3,035
$8,269
Significant Interests in Unconsolidated VIEs—Balance Sheet Classification
The following table presents the carrying amounts and classification of significant variable interests in unconsolidated VIEs:
In billions of dollarsSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Cash$0.1
$0.1
$—
$—
Trading account assets8.6
8.0
8.2
8.5
Investments4.7
4.4
4.7
4.4
Total loans, net of allowance18.2
18.8
22.7
22.2
Other0.5
1.5
0.5
0.5
Total assets$32.1
$32.8
$36.1
$35.6
Credit Card Securitizations
Substantially all of the Company’s credit card securitization activity is through two trusts—Citibank Credit Card Master Trust (Master Trust) and Citibank Omni Master Trust (Omni
 
Trust), with the substantial majority through the Master Trust. These trusts are consolidated entities.
The following table reflects amounts related to the Company’s securitized credit card receivables:
In billions of dollarsSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Ownership interests in principal amount of trust credit card receivables
Sold to investors via trust-issued securities$28.0
$22.7
$26.3
$28.8
Retained by Citigroup as trust-issued securities9.2
7.4
7.5
7.6
Retained by Citigroup via non-certificated interests12.5
20.6
11.6
14.4
Total$49.7
$50.7
$45.4
$50.8

The following tables summarize selected cash flow information related to Citigroup’s credit card securitizations:
Three Months Ended September 30,Three Months Ended September 30,
In billions of dollars2017201620182017
Proceeds from new securitizations$2.2
$—
$1.9
$2.2
Pay down of maturing notes(1.8)(2.8)(2.9)(1.8)
Nine Months Ended September 30,Nine Months Ended September 30,
In billions of dollars2017201620182017
Proceeds from new securitizations$9.8
$—
$5.8
$9.8
Pay down of maturing notes(4.6)(6.3)(8.3)(4.6)

Master Trust Liabilities (at Par Value)
The weighted average maturity of the third-party term notes issued by the Master Trust was 2.83.0 years as of September 30, 20172018 and 2.6 years as of December 31, 2016.2017.

 


In billions of dollarsSept. 30, 2017Dec. 31, 2016Sept. 30, 2018Dec. 31, 2017
Term notes issued to third parties$27.0
$21.7
$24.8
$27.8
Term notes retained by Citigroup affiliates7.3
5.5
5.7
5.7
Total Master Trust liabilities$34.3
$27.2
$30.5
$33.5

Omni Trust Liabilities (at Par Value)
The weighted average maturity of the third-party term notes issued by the Omni Trust was 1.11.7 years as of September 30, 20172018 and 1.9 years as of December 31, 2016.2017.
In billions of dollarsSept. 30, 2017Dec. 31, 2016Sept. 30, 2018Dec. 31, 2017
Term notes issued to third parties$1.0
$1.0
$1.5
$1.0
Term notes retained by Citigroup affiliates1.9
1.9
1.9
1.9
Total Omni Trust liabilities$2.9
$2.9
$3.4
$2.9


Mortgage Securitizations
The following table summarizestables summarize selected cash flow information and retained interests related to Citigroup mortgage securitizations:
Three Months Ended September 30,Three Months Ended September 30,
2017201620182017
In billions of dollarsU.S. agency-
sponsored
mortgages		Non-agency-
sponsored
mortgages		U.S. agency-
sponsored
mortgages
Non-agency-
sponsored
mortgages(1)
U.S. agency-
sponsored
mortgages		Non-agency-
sponsored
mortgages		U.S. agency-
sponsored
mortgages		Non-agency-
sponsored
mortgages
Proceeds from new securitizations$11.7
$4.1
$11.7
$1.4
$7.9
$2.1
$11.7
$4.1
Contractual servicing fees received0.1
—
0.1
—
—
—
0.1
—
Nine Months Ended September 30,Nine Months Ended September 30,
2017201620182017
In billions of dollarsU.S. agency-
sponsored
mortgages		Non-agency-
sponsored
mortgages		U.S. agency-
sponsored
mortgages
Non-agency-
sponsored
mortgages(1)
U.S. agency-
sponsored
mortgages		Non-agency-
sponsored
mortgages		U.S. agency-
sponsored
mortgages		Non-agency-
sponsored
mortgages
Proceeds from new securitizations$25.9
$6.9
$32.5
$8.0
$23.7
$8.2
$26.2
$6.9
Contractual servicing fees received0.2
—
0.3
—
0.1
—
0.2
—

(1) The proceeds from new securitizations in 2016 include $0.5 billion related to personal loan securitizations.
Gains recognized on the securitization of U.S. agency-sponsored mortgages were $6 million and $18 million for the three and nine months ended September 30, 2018, respectively. For the three and nine months ended September 30, 2018, gains recognized on the securitization of non-agency-sponsored mortgages were $5 million and $40 million, respectively.

Gains recognized on the securitization of U.S. agency-sponsored mortgages were $14 million and $61 million for the three and nine months ended September 30, 2017, respectively. For the three and nine months ended September 30, 2017, gains recognized on the securitization of non-agency sponsorednon-agency-sponsored mortgages were $29 million and $75 million, respectively.

Gains recognized on the securitization of U.S. agency-sponsored mortgages were $36 million and $81 million for the three and nine months ended September 30, 2016, respectively. For the three and nine months ended September 30, 2016, gains recognized on the securitization of non-agency sponsored mortgages were $37 million and $65 million, respectively.

 September 30, 2018December 31, 2017
  
Non-agency-sponsored mortgages(1)
 
Non-agency-sponsored mortgages(1)
In millions of dollarsU.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests		U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Carrying value of retained interests$2,092
$296
$112
$1,634
$214
$139

(1)Disclosure of non-agency-sponsored mortgages as senior and subordinated interests is indicative of the interests’ position in the capital structure of the securitization.

Key assumptions used in measuring the fair value of retained interests at the date of sale or securitization of mortgage receivables were as follows:
Three Months Ended September 30, 2017
Non-agency-sponsored mortgages(1)
U.S. agency-
sponsored mortgages
Senior
interests
Subordinated
interests
Discount rate2.0% to 13.2%
—
—
   Weighted average discount rate8.5%—
—
Constant prepayment rate6.6% to 31.6%
—
—
   Weighted average constant prepayment rate10.6%—
—
Anticipated net credit losses(2)
   NM
—
—
   Weighted average anticipated net credit losses   NM
—
—
Weighted average life2.5 to 10.5 years
—
—

Three Months Ended September 30, 2016
Non-agency-sponsored mortgages(1)
U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate1.5% to 13.0%
—
—
   Weighted average discount rate10.0%—
—
Constant prepayment rate7.7% to 30.9%
—
—
   Weighted average constant prepayment rate13.7%—
—
Anticipated net credit losses(2)
   NM
—
—
   Weighted average anticipated net credit losses   NM
—
—
Weighted average life2.0 to 9.8 years
—
—

 Three Months Ended September 30, 2018
  
Non-agency-sponsored mortgages(1)
 
U.S. agency- 
sponsored mortgages
Senior 
interests
Subordinated 
interests
Discount rate3.0% to 10.4%
3.8% to 4.2%
4.1% to 8.6%
   Weighted average discount rate6.9%4.1%5.6%
Constant prepayment rate5.3% to 12.8%
7.0% to 10.0%
7.0% to 10.0%
   Weighted average constant prepayment rate8.1%7.9%8.2%
Anticipated net credit losses(2)
   NM
3.4% to 3.7%
3.4% to 3.7%
   Weighted average anticipated net credit losses   NM
3.6%3.6%
Weighted average life6.9 to 22.1 years
3.0 to 3.9 years
7.3 to 15.7 years



Nine Months Ended September 30, 2017
Non-agency-sponsored mortgages(1)
U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate2.0% to 19.9%
—
—
   Weighted average discount rate9.1%—
—
Constant prepayment rate3.8% to 31.6%
—
—
   Weighted average constant prepayment rate9.6%—
—
Anticipated net credit losses(2)
   NM
—
—
   Weighted average anticipated net credit losses   NM
—
—
Weighted average life2.5 to 14.5 years
—
—
 Three Months Ended September 30, 2017
  
Non-agency-sponsored mortgages(1)
 U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate2.0% to 13.2%
1.4% to 4.5%
1.7% to 4.2%
   Weighted average discount rate8.5%2.8%3.5%
Constant prepayment rate6.6% to 31.6%
—
—
   Weighted average constant prepayment rate10.6%—
—
Anticipated net credit losses(2)
   NM
6.7% to 6.8%
6.4%
   Weighted average anticipated net credit losses   NM
6.7
6.4%
Weighted average life2.5 to 10.5 years
4.9 to 9.4 years
5.0 to 9.1 years

Nine Months Ended September 30, 2016
Non-agency-sponsored mortgages(1)
U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate0.8% to 13.0%
—
—
   Weighted average discount rate9.1%—
—
Constant prepayment rate7.7% to 30.9%
—
—
   Weighted average constant prepayment rate12.8%—
—
Anticipated net credit losses(2)
   NM
—
—
   Weighted average anticipated net credit losses   NM
—
—
Weighted average life0.5 to 17.5 years
—
—
 Nine Months Ended September 30, 2018
  
Non-agency-sponsored mortgages(1)
 U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate3.0% to 11.4%
1.6% to 4.5%
3.0% to 8.6%
   Weighted average discount rate6.3%3.6%4.4%
Constant prepayment rate3.5% to 16.0%
7.0% to 12.0%
7.0% to 12.0%
   Weighted average constant prepayment rate8.2%8.8%9.1%
Anticipated net credit losses(2)
   NM
2.0% to 6.7%
2.0% to 4.6%
   Weighted average anticipated net credit losses   NM
4.4%3.4%
Weighted average life5.0 to 22.1 years
2.5 to 9.9 years
2.5 to 15.7 years
 Nine Months Ended September 30, 2017
  
Non-agency-sponsored mortgages(1)
 U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate2.0% to 19.9%
1.4% to 4.5%
1.7% to 19.1%
   Weighted average discount rate9.1%2.8%4.0%
Constant prepayment rate3.8% to 31.6%
—
—
   Weighted average constant prepayment rate9.6%—
—
Anticipated net credit losses(2)
   NM
6.7% to 6.8%
6.4% to 69.1%
   Weighted average anticipated net credit losses   NM
6.7%10.8%
Weighted average life2.5 to 14.5 years
4.9 to 10.0 years
5.0 to 10.0 years

(1)Disclosure of non-agency-sponsored mortgages as senior and subordinated interests is indicative of the interests’ position in the capital structure of the securitization.
(2)Anticipated net credit losses represent estimated loss severity associated with defaulted mortgage loans underlying the mortgage securitizations disclosed above. Anticipated net credit losses, in this instance, do not represent total credit losses incurred to date, nor do they represent credit losses expected on retained interests in mortgage securitizations.
NMAnticipated net credit losses are not meaningful due to U.S. agency guarantees.

The interests retained by the Company range from highly rated and/or senior in the capital structure to unrated and/or residual interests.
The key assumptions used to value retained interests, and the sensitivity of the fair value to adverse changes of 10% and 20% in each of the key assumptions, are set forth in the tables
 
below. The negative effect of each change is calculated independently, holding all other assumptions constant. Because the key assumptions may not be independent, the net effect of simultaneous adverse changes in the key assumptions may be less than the sum of the individual effects shown below.
 September 30, 2017
  
Non-agency-sponsored mortgages(1)
 U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate0.0% to 82.4%
0.0% to 5.1%
4.8% to 33.9%
   Weighted average discount rate7.9%1.0%9.7%
Constant prepayment rate7.4% to 31.6%
8.9% to 13.9%
0.5% to 13.1%
   Weighted average constant prepayment rate12.3%12.9%7.0%
Anticipated net credit losses(2)
   NM
0.3% to 50.2%
35.1% to 52.1%
   Weighted average anticipated net credit losses   NM
12.2%43.2%
Weighted average life0.4 to 28.0 years
5.2 to 15.1 years
0.4 to 18.8 years



December 31, 2016September 30, 2018
 
Non-agency-sponsored mortgages(1)
 
Non-agency-sponsored mortgages(1)
U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests		U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate0.7% to 28.2%
0.0% to 8.1%
5.1% to 26.4%
2.6% to 55.0%
12.2%4.9% to 5.8%
Weighted average discount rate9.0%2.1%13.1%6.0%12.2%5.2%
Constant prepayment rate6.8% to 22.8%
4.2% to 14.7%
0.5% to 37.5%
3.7% to 19.6%
8.0%5.0% to 16.0%
Weighted average constant prepayment rate10.2%11.0%10.8%8.8%8.0%7.7%
Anticipated net credit losses(2)
   NM
0.5% to 85.6%
8.0% to 63.7%
   NM
38.0%37.0% to 91.0%
Weighted average anticipated net credit losses   NM
31.4%48.3%   NM
38.0%49.7%
Weighted average life0.2 to 28.8 years
5.0 to 8.5 years
1.2 to 12.1 years
0.5 to 28.2 years
7.6 years
6.2 to 15.5 years

 December 31, 2017
  
Non-agency-sponsored mortgages(1)
 U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Discount rate1.8% to 84.2%
5.8% to 100.0%
2.8% to 35.1%
   Weighted average discount rate7.1%5.8%9.0%
Constant prepayment rate6.9% to 27.8%
8.9% to 15.5%
8.6% to 13.1%
   Weighted average constant prepayment rate11.6%8.9%10.6%
Anticipated net credit losses(2)
   NM
0.4% to 46.9%
35.1% to 52.1%
   Weighted average anticipated net credit losses   NM
46.9%44.9%
Weighted average life0.1 to 27.8 years
4.8 to 5.3 years
0.2 to 18.6 years

(1)Disclosure of non-agency-sponsored mortgages as senior and subordinated interests is indicative of the interests’ position in the capital structure of the securitization.
(2)Anticipated net credit losses represent estimated loss severity associated with defaulted mortgage loans underlying the mortgage securitizations disclosed above. Anticipated net credit losses, in this instance, do not represent total credit losses incurred to date, nor do they represent credit losses expected on retained interests in mortgage securitizations.
NMAnticipated net credit losses are not meaningful due to U.S. agency guarantees.
September 30, 2017September 30, 2018
 
Non-agency-sponsored mortgages(1)
 Non-agency-sponsored mortgages
In millions of dollars
U.S. agency- 
sponsored mortgages
Senior 
interests
Subordinated 
interests
U.S. agency- 
sponsored mortgages
Senior 
interests
Subordinated 
interests
Carrying value of retained interests$1,529
$156
$189
Discount rates  
Adverse change of 10%$(45)$(3)$(4)$(61)$—
$(1)
Adverse change of 20%(87)(6)(8)(119)—
(2)
Constant prepayment rate  
Adverse change of 10%(42)(1)(1)(32)—
—
Adverse change of 20%(87)(2)(3)(63)—
—
Anticipated net credit losses  
Adverse change of 10%NM
(4)(1)NM
—
—
Adverse change of 20%NM
(8)(1)NM
—
—



December 31, 2016December 31, 2017
 
Non-agency-sponsored mortgages(1)
 Non-agency-sponsored mortgages
In millions of dollarsU.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests		U.S. agency-
sponsored mortgages		Senior
interests		Subordinated
interests
Carrying value of retained interests$2,258
$26
$161
Discount rates  
Adverse change of 10%$(71)$(7)$(8)$(44)$(2)$(3)
Adverse change of 20%(138)(14)(16)(85)(4)(5)
Constant prepayment rate  
Adverse change of 10%(80)(2)(4)(41)(1)(1)
Adverse change of 20%(160)(3)(8)(84)(1)(2)
Anticipated net credit losses  
Adverse change of 10%NM
(7)(1)NM
(3)—
Adverse change of 20%NM
(14)(2)NM
(7)—

(1)Disclosure of non-agency-sponsored mortgages as senior and subordinated interests is indicative of the interests’ position in the capital structure of the securitization.
NMAnticipated net credit losses are not meaningful due to U.S. agency guarantees.



Mortgage Servicing Rights (MSRs)
The fair value of Citi’s capitalized MSRs was $553$618 million and $1.3 billion$553 million at September 30, 20172018 and 2016,2017, respectively. The MSRs correspond to principal loan balances of $68$62 billion and $173$68 billion as of September 30, 20172018 and 2016,2017, respectively. The following table summarizestables summarize the changes in capitalized MSRs:
Three Months Ended September 30,Three Months Ended September 30,
In millions of dollars2017201620182017
Balance, as of June 30$560
$1,324
$596
$560
Originations19
43
14
19
Changes in fair value of MSRs due to changes in inputs and assumptions(6)13
25
(6)
Other changes(1)
(20)(78)(17)(20)
Sale of MSRs(2)
—
(32)—
—
Balance, as of September 30$553
$1,270
$618
$553
Nine Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620182017
Balance, beginning of year$1,564
$1,781
$558
$1,564
Originations75
111
46
75
Changes in fair value of MSRs due to changes in inputs and assumptions50
(349)82
50
Other changes(1)
(90)(255)(50)(90)
Sale of MSRs(2)
(1,046)(18)(18)(1,046)
Balance, as of September 30$553
$1,270
$618
$553

(1)Represents changes due to customer payments and passage of time.
(2)See Note 2 to the Consolidated Financial Statements in Citi’s 2017 Annual Report on Form 10-K for more information on the exit of the U.S. mortgage servicing operations and sale of MSRs. 2016 amount includes sales of credit challenged MSRs for which Citi paid the new servicer.in 2017.

The Company receives fees during the course of servicing previously securitized mortgages. The amounts of these fees were as follows:
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
Servicing fees$65
$117
$236
$371
$41
$65
$130
$236
Late fees2
3
8
11
1
2
3
8
Ancillary fees3
4
11
13
1
3
7
11
Total MSR fees$70
$124
$255
$395
$43
$70
$140
$255

In the Consolidated Statement of Income these fees are primarily classified as Commissions and fees, and changes in MSR fair values are classified as Other revenue.



Re-securitizations
The Company engages in re-securitization transactions in which debt securities are transferred to a VIE in exchange for new beneficial interests. Citi did not transfer non-agency (private-label) securities to re-securitization entities during the three and nine months ended September 30, 20172018 and 2016.2017. These securities are backed by either residential or commercial mortgages and are often structured on behalf of clients.
As of September 30, 2017,2018, the fair value of Citi-retained interests in private-label re-securitization transactions structured by Citi totaled approximately $75$33 million (all related to re-securitization transactions executed prior to 2017)2016), which has been recorded in Trading account assets. Of this amount, substantially all was related to subordinated beneficial interests. As of December 31, 2016,2017, the fair value of Citi-retained interests in private-label re-securitization transactions structured by Citi totaled approximately $126$79 million (all related to re-securitization transactions executed prior to 2016). Of this amount, substantially all was related to subordinated beneficial interests. The original par value of private-label re-securitization transactions in which Citi holds a retained interest as of September 30, 20172018 and December 31, 20162017 was approximately $954$316 million and $1.3 billion,$887 million, respectively.
The Company also re-securitizes U.S. government-agency guaranteed mortgage-backed (agency) securities. During the three and nine months ended September 30, 2017,2018, Citi transferred agency securities with a fair value of approximately $9.9$6.8 billion and $20.0$20.4 billion, respectively, to re-securitization entities compared to approximately $7.1$9.9 billion and $21.3$20.0 billion for the three and nine months ended September 30, 2016.2017, respectively.
As of September 30, 2017,2018, the fair value of Citi-retained interests in agency re-securitization transactions structured by Citi totaled approximately $2.0$2.4 billion (including $713$1.3 billion related to re-securitization transactions executed in 2018) compared to $2.1 billion as of December 31, 2017 (including $854 million related to re-securitization transactions executed in 2017) compared to $2.3 billion as of December 31, 2016 (including $741 million related to re-securitization transactions executed in 2016), which is recorded in Trading account assets. The original fair value of agency re-securitization transactions in which Citi holds a retained interest as of September 30, 20172018 and December 31, 20162017 was approximately $67.6$67.2 billion and $71.8$68.3 billion, respectively.
As of September 30, 20172018 and December 31, 2016,2017, the Company did not consolidate any private-label or agency re-securitization entities.



Citi-Administered Asset-Backed Commercial Paper Conduits
At September 30, 20172018 and December 31, 2016,2017, the commercial paper conduits administered by Citi had approximately $19.3$17.4 billion and $19.7$19.3 billion of purchased assets outstanding, respectively, and had incremental funding commitments with clients of approximately $14.3$16.3 billion and $12.8$14.5 billion, respectively.
Substantially all of the funding of the conduits is in the form of short-term commercial paper. At September 30, 20172018 and December 31, 2016,2017, the weighted average remaining lives of the commercial paper issued by the conduits were approximately 5355 and 5551 days, respectively.
The primary credit enhancement provided to the conduit investors is in the form of transaction-specific credit enhancements described above. In addition to the transaction-specific credit enhancements, the conduits, other than the government guaranteed loan conduit, have obtained a letter of credit from the Company, which is equal to at least 8% to 10% of the conduit’s assets with a minimum of $200 million. The letters of credit provided by the Company to the conduits total approximately $1.8$1.6 billion as of September 30, 20172018 and December 31, 2016.2017. The net result across multi-seller conduits administered by the Company is that, in the event defaulted assets exceed the transaction-specific credit enhancements described above, any losses in each conduit are allocated first to the Company and then to the commercial paper investors.
At September 30, 20172018 and December 31, 2016,2017, the Company owned $9.3$5.4 billion and $9.7$9.3 billion, respectively, of the commercial paper issued by its administered conduits. The Company's investments were not driven by market illiquidity and the Company is not obligated under any agreement to purchase the commercial paper issued by the conduits.

Collateralized Loan Obligations
The following table summarizestables summarize selected cash flow information and retained interests related to Citigroup CLOs:
Three Months Ended September 30,Three Months Ended September 30,
In billions of dollars2017201620182017
Proceeds from new securitizations$1.1
$1.8
$0.4
$1.1
 Nine Months Ended September 30,
In billions of dollars20172016
Proceeds from new securitizations$2.5
$3.8

The key assumptions used to value retained interests in CLOs, and the sensitivity of the fair value to adverse changes of 10% and 20% are set forth in the tables below:
 Nine Months Ended September 30,
In billions of dollars20182017
Proceeds from new securitizations$4.0
$2.5
Cash flows received on retained interests and other cash flows0.1
0.1

Sept. 30, 2017Dec. 31, 2016
Discount rate   1.1% to 1.6%1.3% to 1.7%
In millions of dollarsSept. 30, 2018Dec. 31, 2017
Carrying value of retained interests$3,461
$4,079

In millions of dollarsSept. 30, 2017Dec. 31, 2016
Carrying value of retained interests$3,883
$4,261
Discount rates  
   Adverse change of 10%$(25)$(30)
   Adverse change of 20%(51)(62)




Asset-Based Financing
The primary types of Citi’s asset-based financings, total assets of the unconsolidated VIEs with significant involvement and Citi’s maximum exposure to loss are shown below. For Citi to realize the maximum loss, the VIE (borrower) would have to default with no recovery from the assets held by the VIE.
September 30, 2017September 30, 2018
In millions of dollars
Total 
unconsolidated 
VIE assets
Maximum 
exposure to 
unconsolidated VIEs
Total 
unconsolidated 
VIE assets
Maximum 
exposure to 
unconsolidated VIEs
Type  
Commercial and other real estate$8,971
$3,068
$18,098
$6,949
Corporate loans2,763
1,706
6,815
5,764
Hedge funds and equities499
59
416
54
Airplanes, ships and other assets38,488
16,194
38,849
17,108
Total$50,721
$21,027
$64,178
$29,875
December 31, 2016December 31, 2017
In millions of dollars
Total 
unconsolidated 
VIE assets
Maximum 
exposure to 
unconsolidated VIEs
Total 
unconsolidated 
VIE assets
Maximum 
exposure to 
unconsolidated VIEs
Type  
Commercial and other real estate$8,784
$2,368
$15,370
$5,445
Corporate loans4,051
2,684
4,725
3,587
Hedge funds and equities370
54
542
58
Airplanes, ships and other assets39,230
16,837
39,202
16,849
Total$52,435
$21,943
$59,839
$25,939

Municipal Securities Tender Option Bond (TOB) Trusts
At September 30, 20172018 and December 31, 2016, approximately $56 million and $82 million, respectively,2017, none of the municipal bonds owned by non-customer TOB trusts were subject to a credit guarantee provided by the Company.
At September 30, 20172018 and December 31, 2016,2017, liquidity agreements provided with respect to customer TOB trusts totaled $3.1$4.1 billion and $2.9$3.2 billion, respectively, of which $2.0$2.2 billion and $2.1$2.0 billion, respectively, were offset by reimbursement agreements. For the remaining exposure related to TOB transactions, where the residual owned by the customer was at least 25% of the bond value at the inception of the transaction, no reimbursement agreement was executed.
The Company also provides other liquidity agreements or letters of credit to customer-sponsored municipal investment funds, which are not variable interest entities, and municipality-related issuers that totaled $6.1 billion and $7.4 billion as of September 30, 20172018 and December 31, 2016, respectively.2017. These liquidity agreements and letters of credit are offset by reimbursement agreements with various term-out provisions.

Client Intermediation
The proceeds from new securitizations related to the Company’s client intermediation transactions for the three and nine months ended September 30, 20172018 totaled approximately $0.2 billion and $0.90.7 billion, respectively, compared to $0.5$0.2 billion and $1.9$0.9 billion for the three and nine months ended September 30, 2016.2017, respectively.


19.  DERIVATIVES ACTIVITIES
As of January 1, 2018, Citigroup early adopted ASU 2017-12, Targeted Improvements to Accounting for Hedge Activities. This standard primarily impacts Citi’s accounting for derivatives designated as cash flow hedges and fair value hedges. Refer to the respective sections below for details.
In the ordinary course of business, Citigroup enters into various types of derivative transactions. All derivatives are recorded in Trading account assets/Trading account liabilities on the Consolidated Balance Sheet. For additional information regarding Citi’s use of and accounting for derivatives, see Note 22 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
Information pertaining to Citigroup’s derivative activities, based on notional amounts, is presented in the table below. Derivative notional amounts are reference amounts from which contractual payments are derived and do not represent a complete and accurate measure of Citi’s exposure to derivative transactions. Rather, Citi’s derivative exposure arises primarily from market fluctuations (i.e., market risk), counterparty failure (i.e., credit risk) and/or periods of high volatility or financial stress (i.e., liquidity risk), as well as any market valuation adjustments that may be required on the transactions. Moreover, notional amounts do not reflect the netting of offsetting trades. For example, if Citi enters into a receive-fixed interest rate swap with $100 million notional, and offsets this risk with an identical but opposite pay-fixed position with a different counterparty, $200 million in derivative notionals is reported, although these offsetting positions may result in de minimis overall market risk. AggregateIn addition, aggregate derivative notional amounts can fluctuate from period to period in the normal course of business based on Citi’s market share, levels of client activity and other factors.

 






























Derivative Notionals
Hedging instruments under
ASC 815(1)(2)
Other derivative instruments

Trading derivatives
Management hedges(3)
Hedging instruments under
ASC 815		Trading derivative instruments
In millions of dollarsSeptember 30,
2017		December 31,
2016		September 30,
2017		December 31,
2016		September 30,
2017		December 31,
2016		September 30,
2018		December 31,
2017		September 30,
2018		December 31,
2017
Interest rate contracts        
Swaps$186,553
$151,331
$20,878,378
$19,145,250
$38,964
$47,324
$246,079
$189,779
$19,759,439
$18,754,219
Futures and forwards—
97
6,926,108
6,864,276
13,504
30,834
—
—
8,297,965
6,460,539
Written options—


3,446,771
2,921,070
2,659
4,759
—
—
3,857,773
3,516,131
Purchased options—
—
3,195,655
2,768,528
3,580
7,320
—
—
3,236,924
3,234,025
Total interest rate contract notionals$186,553
$151,428
$34,446,912
$31,699,124
$58,707
$90,237
$246,079
$189,779
$35,152,101
$31,964,914
Foreign exchange contracts         
Swaps$35,431
$19,042
$6,870,504
$5,492,145
$27,052
$22,676
$54,502
$37,162
$7,004,521
$5,576,357
Futures, forwards and spot38,100
56,964
4,658,973
3,251,132
5,153
3,419
37,769
33,103
5,711,577
3,097,700
Written options4,027
—
1,466,308
1,194,325
—
—
2,497
3,951
1,727,916
1,127,728
Purchased options6,697
—
1,507,896
1,215,961
—
—
2,934
6,427
1,695,392
1,148,686
Total foreign exchange contract notionals$84,255
$76,006
$14,503,681
$11,153,563
$32,205
$26,095
$97,702
$80,643
$16,139,406
$10,950,471
Equity contracts          
Swaps$—
$—
$219,056
$192,366
$—
$—
$—
$—
$245,167
$215,834
Futures and forwards—
—
57,541
37,557
—
—
—
—
70,526
72,616
Written options—
—
410,746
304,579
—
—
—
—
436,032
389,961
Purchased options—
—
336,586
266,070
—
—
—
—
333,448
328,154
Total equity contract notionals$—
$—
$1,023,929
$800,572
$—
$—
$—
$—
$1,085,173
$1,006,565
Commodity and other contracts          
Swaps$—
$—
$81,208
$70,774
$—
$—
$—
$—
$118,699
$82,039
Futures and forwards139
182
158,757
142,530
—
—
397
23
164,427
153,248
Written options—
—
76,663
74,627
—
—
—
—
72,021
62,045
Purchased options—
—
74,620
69,629
—
—
—
—
69,862
60,526
Total commodity and other contract notionals$139
$182
$391,248
$357,560
$—
$—
$397
$23
$425,009
$357,858
Credit derivatives(4)
      
Credit derivatives(1)
   
Protection sold$—
$—
$872,476
$859,420
$98
$—
$—
$—
$723,060
$735,142
Protection purchased—
—
900,866
883,003
13,201
19,470
—
—
793,792
777,713
Total credit derivatives$—
$—
$1,773,342
$1,742,423
$13,299
$19,470
$—
$—
$1,516,852
$1,512,855
Total derivative notionals$270,947
$227,616
$52,139,112
$45,753,242
$104,211
$135,802
$344,178
$270,445
$54,318,541
$45,792,663

(1)The notional amounts presented in this table do not include hedge accounting relationships under ASC 815 where Citigroup is hedging the foreign currency risk of a net investment in a foreign operation by issuing a foreign-currency-denominated debt instrument. The notional amount of such debt was $63 million and $1,825 million at September 30, 2017 and December 31, 2016, respectively.
(2)
Derivatives in hedge accounting relationships accounted for under ASC 815 are recorded in either Other assets/Other liabilities or Trading account assets/Trading account liabilities on the Consolidated Balance Sheet.
(3)
Management hedges represent derivative instruments used to mitigate certain economic risks, but for which hedge accounting is not applied. These derivatives are recorded in either Other assets/Other liabilities or Trading account assets/Trading account liabilities on the Consolidated Balance Sheet.
(4)Credit derivatives are arrangements designed to allow one party (protection buyer) to transfer the credit risk of a “reference asset” to another party (protection seller). These arrangements allow a protection seller to assume the credit risk associated with the reference asset without directly purchasing that asset. The Company enters into credit derivative positions for purposes such as risk management, yield enhancement, reduction of credit concentrations and diversification of overall risk.


The following tables present the gross and net fair values of the Company’s derivative transactions and the related offsetting amounts as of September 30, 20172018 and December 31, 2016.2017. Gross positive fair values are offset against gross negative fair values by counterparty, pursuant to enforceable master netting agreements. Under ASC 815-10-45, payables and receivables in respect of cash collateral received from or paid to a given counterparty pursuant to a credit support annex are included in the offsetting amount, if a legal opinion supporting the enforceability of netting and collateral rights has been obtained. GAAP does not permit similar offsetting for security collateral.
In addition, the table for September 30, 2017 reflectsfollowing tables reflect rule changes adopted by clearing organizations that require or allow entities to elect to treat certain derivative assets, liabilities and the related variation margin as settlement of the related derivative fair values for legal and accounting purposes, as
opposed to presenting gross derivative assets and liabilities that are subject to collateral, whereby the counterparties would record a related collateral payable or receivable. As a result, the table for September 30, 2017 reflectstables reflect a reduction of approximately $110 billion and $100 billion as of September 30, 2018 and December 31, 2017, respectively, of derivative assets and derivative liabilities that previously would have been reported on a gross basis, but are now settled and not subject to collateral.  The table for December 31, 2016 presents derivative assets and liabilities as gross amounts subject to variation margin collateral that were netted under enforceable master netting agreements. Therefore the net presentation of the affected items on the consolidated balance sheet is consistent for all periods. The tables also present amounts that are not permitted to be offset, such as security collateral or cash collateral posted at third-party custodians, but which would be eligible for offsetting to the extent that an event of default occurred and a legal opinion supporting enforceability of the netting and collateral rights has been obtained.


Derivative Mark-to-Market (MTM) Receivables/Payables
In millions of dollars at September 30, 2017
Derivatives classified
in Trading account
assets / liabilities(1)(2)(3)
Derivatives classified
in Other
assets / liabilities(2)(3)
In millions of dollars at September 30, 2018
Derivatives classified in
Trading account assets/liabilities(1)(2)
Derivatives instruments designated as ASC 815 hedgesAssetsLiabilitiesAssetsLiabilitiesAssetsLiabilities
Over-the-counter$440
$107
$1,291
$30
$1,411
$81
Cleared29
29
35
69
137
575
Interest rate contracts$469
$136
$1,326
$99
$1,548
$656
Over-the-counter$936
$676
$771
$147
$1,568
$718
Foreign exchange contracts$936
$676
$771
$147
$1,568
$718
Total derivatives instruments designated as ASC 815 hedges$1,405
$812
$2,097
$246
$3,116
$1,374
Derivatives instruments not designated as ASC 815 hedges


 
Over-the-counter$200,554
$179,000
$35
$1
$155,901
$136,989
Cleared6,843
8,520
73
105
8,262
10,062
Exchange traded116
93
—
—
130
136
Interest rate contracts$207,513
$187,613
$108
$106
$164,293
$147,187
Over-the-counter$130,399
$129,096
$—
$—
$169,989
$164,571
Cleared3,180
3,312
—
—
3,326
3,360
Exchange traded58
52
—
—
88
236
Foreign exchange contracts$133,637
$132,460
$—
$—
$173,403
$168,167
Over-the-counter$18,736
$24,317
$—
$—
$19,891
$24,766
Cleared16
20
—
—
10
9
Exchange traded8,532
8,179
—
—
10,143
10,354
Equity contracts$27,284
$32,516
$—
$—
$30,044
$35,129
Over-the-counter$11,444
$14,541
$—
$—
$22,449
$25,024
Exchange traded745
703
—
—
826
756
Commodity and other contracts$12,189
$15,244
$—
$—
$23,275
$25,780
Over-the-counter$15,169
$15,592
$23
$68
$4,240
$5,912
Cleared8,042
9,593
22
297
7,326
5,781
Credit derivatives(4)
$23,211
$25,185
$45
$365
$11,566
$11,693
Total derivatives instruments not designated as ASC 815 hedges$403,834
$393,018
$153
$471
$402,581
$387,956
Total derivatives$405,239
$393,830
$2,250
$717
$405,697
$389,330
Cash collateral paid/received(6)(3)
$13,991
$15,848
$—
$9
$10,759
$13,676
Less: Netting agreements(7)(4)
(325,424)(325,424)—
—
(322,565)(322,565)
Less: Netting cash collateral received/paid(8)(5)
(37,876)(32,390)(1,005)(17)(37,678)(30,701)
Net receivables/payables included on the Consolidated Balance Sheet(9)(6)
$55,930
$51,864
$1,245
$709
$56,213
$49,740
Additional amounts subject to an enforceable master netting agreement, but not offset on the Consolidated Balance Sheet  
Less: Cash collateral received/paid$(861)$(61)$—
$—
$(739)$(83)
Less: Non-cash collateral received/paid(11,864)(9,798)(294)—
(12,389)(11,376)
Total net receivables/payables(9)(6)
$43,205
$42,005
$951
$709
$43,085
$38,281
(1)The trading derivatives fair values are also presented in Note 20 to the Consolidated Financial Statements.
(2)
Derivative mark-to-market receivables/payables related to management hedges are recorded in either Other assets/Other liabilities or Trading account assets/Trading account liabilities.
(3)Over-the-counter (OTC) derivatives are derivatives executed and settled bilaterally with counterparties without the use of an organized exchange or central clearing house. Cleared derivatives include derivatives executed bilaterally with a counterparty in the OTC market, but then novated to a central clearing house, whereby the central clearing house becomes the counterparty to both of the original counterparties. Exchange tradedExchange-traded derivatives include derivatives executed directly on an organized exchange that provides pre-trade price transparency.
(4)(3)The credit derivatives assets comprise $5,076 million related to protection purchased and $18,180 million related to protection sold as of September 30, 2017. The credit derivatives liabilities comprise $20,616 million related to protection purchased and $4,934 million related to protection sold as of September 30, 2017.
(5)For the trading account assets/liabilities, reflectsReflects the net amount of the $46,381$41,460 million and $53,724$51,354 million of gross cash collateral paid and received, respectively. Of the gross cash collateral paid, $32,390$30,701 million was used to offset trading derivative liabilities and, of the gross cash collateral received, $37,876$37,678 million was used to offset trading derivative assets.


(6)
For cash collateral paid with respect to non-trading derivative assets, reflects the net amount of $17 million of gross cash collateral paid, of which $17 million is netted against non-trading derivative positions within Other liabilities. For cash collateral received with respect to non-trading derivative liabilities, reflects the net amount of $1,014 million of gross cash collateral received, of which $1,005 million is netted against non-trading derivative positions within Other assets.
(7)(4)Represents the netting of derivative receivable and payable balances with the same counterparty under enforceable netting agreements. Approximately $301$304 billion, $15$9 billion and $9$10 billion of the netting against trading account asset/liability balances is attributable to each of the OTC, cleared and exchange-traded derivatives, respectively.
(8)(5)Represents the netting of cash collateral paid and received by counterparty under enforceable credit support agreements. Substantially all cash collateral received and paid is netted against OTC derivative assets and liabilities, respectively.


(9)(6)The net receivables/payables include approximately $5$6 billion of derivative asset and $6$7 billion of derivative liability fair values not subject to enforceable master netting agreements, respectively.

In millions of dollars at December 31, 2016
Derivatives classified in Trading
account assets / liabilities(1)(2)(3)
Derivatives classified in Other assets / liabilities(2)(3)
In millions of dollars at December 31, 2017
Derivatives classified in
Trading account assets/liabilities(1)(2)
Derivatives instruments designated as ASC 815 hedgesAssetsLiabilitiesAssetsLiabilitiesAssetsLiabilities
Over-the-counter$716
$171
$1,927
$22
$1,969
$134
Cleared3,530
2,154
47
82
110
92
Interest rate contracts$4,246
$2,325
$1,974
$104
$2,079
$226
Over-the-counter$2,494
$393
$747
$645
$1,143
$1,150
Foreign exchange contracts$2,494
$393
$747
$645
$1,143
$1,150
Total derivatives instruments designated as ASC 815 hedges$6,740
$2,718
$2,721
$749
$3,222
$1,376
Derivatives instruments not designated as ASC 815 hedges


 
Over-the-counter$244,072
$221,534
$225
$5
$195,677
$173,937
Cleared120,920
130,855
240
349
7,129
10,381
Exchange traded87
47
—
—
102
95
Interest rate contracts$365,079
$352,436
$465
$354
$202,908
$184,413
Over-the-counter$182,659
$186,867
$—
$60
$119,092
$117,473
Cleared482
470
—
—
1,690
2,028
Exchange traded27
31
—
—
34
121
Foreign exchange contracts$183,168
$187,368
$—
$60
$120,816
$119,622
Over-the-counter$15,625
$19,119
$—
$—
$17,221
$21,201
Cleared1
21
—
—
21
25
Exchange traded8,484
7,376
—
—
9,736
10,147
Equity contracts$24,110
$26,516
$—
$—
$26,978
$31,373
Over-the-counter$13,046
$14,234
$—
$—
$13,499
$16,362
Exchange traded719
798
—
—
604
665
Commodity and other contracts$13,765
$15,032
$—
$—
$14,103
$17,027
Over-the-counter$19,033
$19,563
$159
$78
$12,972
$12,958
Cleared5,582
5,874
47
310
7,562
8,575
Credit derivatives(4)
$24,615
$25,437
$206
$388
$20,534
$21,533
Total derivatives instruments not designated as ASC 815 hedges$610,737
$606,789
$671
$802
$385,339
$373,968
Total derivatives$617,477
$609,507
$3,392
$1,551
$388,561
$375,344
Cash collateral paid/received(6)(3)
$11,188
$15,731
$8
$1
$7,541
$14,308
Less: Netting agreements(7)(4)
(519,000)(519,000)—
—
(306,401)(306,401)
Less: Netting cash collateral received/paid(8)(5)
(45,912)(49,811)(1,345)(53)(38,532)(35,666)
Net receivables/payables included on the Consolidated Balance Sheet(9)(6)
$63,753
$56,427
$2,055
$1,499
$51,169
$47,585
Additional amounts subject to an enforceable master netting agreement, but not offset on the Consolidated Balance Sheet  
Less: Cash collateral received/paid$(819)$(19)$—
$—
$(872)$(121)
Less: Non-cash collateral received/paid(11,767)(5,883)(530)—
(12,739)(6,929)
Total net receivables/payables(9)(6)
$51,167
$50,525
$1,525
$1,499
$37,558
$40,535
(1)
The trading derivatives fair values are presented in Note 20 to the Consolidated Financial Statements.
(2)
Derivative mark-to-market receivables/payables related to management hedges are recorded in eitherpreviously reported within Other assets/Other liabilitieshave been reclassified to or Trading account assets/Trading account liabilities.to conform with the current-period presentation.
(3)(2)Over-the-counter (OTC) derivatives are derivatives executed and settled bilaterally with counterparties without the use of an organized exchange or central clearing house. Cleared derivatives include derivatives executed bilaterally with a counterparty in the OTC market, but then novated to a central clearing house,


whereby the central clearing house becomes the counterparty to both of the original counterparties. Exchange traded whereby the central clearing house becomes the counterparty to both of the original counterparties. Exchange-traded derivatives include derivatives executed directly on an organized exchange that provides pre-trade price transparency.
(4)The credit derivatives trading assets comprise $8,871 million related to protection purchased and $15,744 million related to protection sold as of December 31, 2016. The credit derivatives trading liabilities comprise $16,722 million related to protection purchased and $8,715 million related to protection sold as of December 31, 2016.
(5)(3)For the trading account assets/liabilities, reflectsReflects the net amount of the $60,999$43,207 million and $61,643$52,840 million of gross cash collateral paid and received, respectively. Of the gross cash collateral paid, $49,811$35,666 million was used to offset trading derivative liabilities and, of the gross cash collateral received, $45,912$38,532 million was used to offset trading derivative assets.
(6)
For cash collateral paid with respect to non-trading derivative assets, reflects the net amount of $61 million of gross cash collateral paid, of which $53 million is netted against non-trading derivative positions within Other liabilities. For cash collateral received with respect to non-trading derivative liabilities, reflects the net amount of $1,346 million of gross cash collateral received, of which $1,345 million is netted against OTC non-trading derivative positions within Other assets.
(7)(4)Represents the netting of derivative receivable and payable balances with the same counterparty under enforceable netting agreements. Approximately $383$283 billion, $128$14 billion and $8$9 billion of the netting against trading account asset/liability balances is attributable to each of the OTC, cleared and exchange-traded derivatives, respectively.


(8)(5)Represents the netting of cash collateral paid and received by counterparty under enforceable credit support agreements. Substantially all cash collateral received and paid is netted against OTC derivative assets and liabilities, respectively.
(9)(6)The net receivables/payables include approximately $7$6 billion of derivative asset and $9$8 billion of derivative liability fair values not subject to enforceable master netting agreements, respectively.

For the three and nine months ended September 30, 20172018 and 2016,2017, the amounts recognized in Principal transactions in the Consolidated Statement of Income related to derivatives not designated in a qualifying hedging relationship, as well as the underlying non-derivative instruments, are presented in Note 6 to the Consolidated Financial Statements. Citigroup presents this disclosure by business classification, showing derivative gains and losses related to its trading activities together with gains and losses related to non-derivative instruments within the same trading portfolios, as this represents how these portfolios are risk managed.
The amounts recognized in Other revenue in the Consolidated Statement of Income related to derivatives not designated in a qualifying hedging relationship are shown below. The table below does not include any offsetting gains/lossesgains (losses) on the economically hedged items to the extent such amounts are also recorded in Other revenue.
 
Gains (losses) included in
Other revenue

Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620172016
Interest rate contracts$(9)$(28)$(44)$(2)
Foreign exchange—
11
26
26
Credit derivatives(109)(399)(452)(960)
Total Citigroup$(118)$(416)$(470)$(936)
 
Gains (losses) included in
Other revenue

Three Months Ended
September 30,
Nine Months Ended September 30,
In millions of dollars2018201720182017
Interest rate contracts$(22)$(5)$(65)$(72)
Foreign exchange7
596
(6)1,897
Credit derivatives(200)(125)(271)(501)
Total$(215)$466
$(342)$1,324



Fair Value Hedges

Hedging of Benchmark Interest Rate Risk
Citigroup’s fair value hedges are primarily hedges of fixed-rate long-term debt or assets, such as available-for-sale debt securities or loans.
For qualifying fair value hedges of interest rate risk, the changes in the fair value of the derivative and the change in the fair value of the hedged item attributable to the hedged risk, either total cash flows or benchmark only cash flows are presented within Interest revenue or Interest expense based on whether the hedged item is an asset or a liability. Prior to the adoption of ASU 2017-12, the fair value of the derivative was presented in Other revenue or Principal transactions and the difference between the changes in the hedged item and the derivative was defined as ineffectiveness.

Hedging of Foreign Exchange Risk
Citigroup hedges the change in fair value attributable to foreign exchange rate movements in available-for-sale debt securities and long-term debt that are denominated in currencies other than the functional currency of the entity holding the securities or issuing the debt, which may be within or outside the U.S. The hedging instrument may be a forward foreign exchange contract or a cross-currency swap contract. Citigroup considers the premium associated with forward contracts (i.e., the differential between the spot and contractual forward rates) as the cost of hedging; this amount is excluded from the assessment of hedge effectiveness and reflected directly in earnings over the life of the hedge. Beginning January 1, 2018, Citi excludes changes in cross-currency basis associated with cross-currency swaps from the assessment of hedge effectiveness and records it in Other comprehensive income.
 
Hedging of Commodity Price Risk
Citigroup hedges the change in fair value attributable to spot price movements in physical commodities inventory. The hedging instrument is a futures contract to sell the underlying commodity. In this hedge, the change in the value of the hedged inventory is reflected in earnings, which offsets the change in the fair value of the futures contract that is also reflected in earnings. Although the change in the fair value of the hedging instrument recorded in earnings includes changes in forward rates, Citigroup excludes the differential between the spot and the contractual forward rates under the futures contract from the assessment of hedge effectiveness and amortizes it directly into earnings over the life of the hedge.


























Fair Value Hedges
The following table summarizes the gains (losses) on the Company’s fair value hedges:
Gains (losses) on fair value hedges(1)
Gains (losses) on fair value hedges(1)
Three Months Ended September 30,Nine Months Ended September 30,
Three Months Ended September 30,Nine Months Ended September 30,2018
2017(3)
2018
2017(3)
In millions of dollars2017201620172016Other revenueNet interest revenue
Other
revenue
Other
revenue
Net interest revenue
Other
revenue
Gain (loss) on the derivatives in designated and qualifying fair value hedges        
Interest rate contracts$(194)$(450)$(570)$2,747
Foreign exchange contracts(166)(602)(803)(2,360)
Commodity contracts(11)(57)(20)381
Interest rate hedges$—
$(857)$(194)$—
$(497)$(570)
Foreign exchange hedges(158)—
(166)341
—
(803)
Commodity hedges(14)—
(11)(14)—
(20)
Total gain (loss) on the derivatives in designated and qualifying fair value hedges$(371)$(1,109)$(1,393)$768
$(172)$(857)$(371)$327
$(497)$(1,393)
Gain (loss) on the hedged item in designated and qualifying fair value hedges        
Interest rate hedges$189
$442
$532
$(2,701)$—
$871
$189
$—
$525
$532
Foreign exchange hedges144
664
910
2,425
132
—
144
(464)—
910
Commodity hedges12
59
22
(374)8
—
12
9
—
22
Total gain (loss) on the hedged item in designated and qualifying fair value hedges$345
$1,165
$1,464
$(650)$140
$871
$345
$(455)$525
$1,464
Hedge ineffectiveness recognized in earnings on designated and qualifying fair value hedges   
Net gain (loss) excluded from assessment of the effectiveness of fair value hedges     
Interest rate hedges$(5)$(11)$(31)$48
$—
$—
$—
$—
$(5)$(7)
Foreign exchange hedges(17)(3)32
(53)
Total hedge ineffectiveness recognized in earnings on designated and qualifying fair value hedges$(22)$(14)$1
$(5)
Net gain (loss) excluded from assessment of the effectiveness of fair value hedges   
Interest rate contracts$—
$3
$(7)$(2)
Foreign exchange contracts(2)
(5)65
75
118
Foreign exchange hedges(2)
7
—
(5)63
—
75
Commodity hedges1
2
2
7
(7)—
1
(5)—
2
Total net gain (loss) excluded from assessment of the effectiveness of fair value hedges$(4)$70
$70
$123
$—
$—
$(4)$58
$(5)$70
(1)
AmountsBeginning January 1, 2018, gain (loss) amounts for interest rate risk hedges are included in Interest income/Interest expense, while the remaining amounts including the amounts for interest rate hedges prior to January 1, 2018 are included in Other revenueor Principal transactions on the Consolidated Statement of Income. The accrued interest income on fair value hedges both prior to and after January 1, 2018 is recorded in Net interest revenue and is excluded from this table.
(2)Amounts relate to the premium associated with forward contracts (differential between spot and contractual forward rates). These amounts are excluded from the assessment of hedge effectiveness and are reflected directly in earnings. After January 1, 2018, amounts include cross-currency basis, which is recognized in accumulated other comprehensive income. The amount of cross-currency basis that was included in accumulated other comprehensive income was $15 million and $57 million for the three and nine months ended September 30, 2018, respectively, none of which was recognized in earnings.
(3)Hedge ineffectiveness recognized in earnings on designated and qualifying fair value hedges for the three months ended September 30, 2017 was $(5) million for interest rate hedges and $(17) million for foreign exchange hedges, for a total of $(22) million. Hedge ineffectiveness recognized in earnings on designated and qualifying fair value hedges for the nine months ended September 30, 2017 was $(31) million for interest rate hedges and $32 million for foreign exchange hedges, for a total of $1 million.

Cumulative Basis Adjustment
Upon electing to apply ASC 815 fair value hedge accounting, the carrying value of the hedged item is adjusted to reflect the cumulative impact of changes in the hedged risk. The hedge basis adjustment, whether arising from an active or de-designated hedge relationship, remains with the hedged item until the hedged item is derecognized from the balance sheet. The table below presents the carrying amount of Citi’s hedged assets and liabilities under qualifying fair value hedges at September 30, 2018, along with the cumulative hedge basis adjustments included in the carrying value of those hedged assets and liabilities.
In millions of dollars as of September 30, 2018
Balance sheet line item in which hedged item is recordedCarrying amount of hedged asset/ liabilityCumulative fair value hedging adjustment increasing (decreasing) the carrying amount
ActiveDe-designated
Debt securities
  AFS

$80,244
$(326)$421
Long-term debt154,540
(775)1,218


Cash Flow Hedges
The amountCitigroup hedges the variability of hedge ineffectivenessforecasted cash flows associated with floating-rate assets/liabilities and other forecasted transactions. Variable cash flows from those liabilities are synthetically converted to fixed-rate cash flows by entering into receive-variable, pay-fixed interest rate swaps and receive-variable, pay-fixed forward-starting interest rate swaps. Variable cash flows associated with certain assets are synthetically converted to fixed-rate cash flows by entering into receive-fixed, pay-variable interest rate swaps. These cash flow hedging relationships use either regression analysis or dollar-offset ratio analysis to assess whether the hedging relationships are highly effective at inception and on an ongoing basis. Prior to the adoption of ASU 2017-12, Citigroup designated the risk being hedged as the risk of overall variability in the hedged cash flows for certain items.
With the adoption of ASU 2017-12, Citigroup hedges the variability from changes in a contractually specified rate and recognizes the entire change in fair value of the cash flow hedgeshedging instruments in AOCI. Prior to the adoption of ASU 2017-12, to the extent that these derivatives were not fully effective, changes in their fair values in excess of changes in the value of the hedged transactions were immediately included in Other revenue. With the adoption of ASU 2017-12, such amounts are no longer required to be immediately recognized in income, but instead the full change in the value of the hedging instrument is required to be recognized in AOCI, and then recognized in earnings forin the three and nine months ended September 30, 2017 and 2016 is not significant.same period that the cash flows impact earnings. The pretax change in AOCI from cash flow hedges is presented below:

 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620172016
Effective portion of cash flow hedges included in AOCI    
Interest rate contracts$(36)$(187)$103
$448
Foreign exchange contracts(7)(29)(7)(26)
Total effective portion of cash flow hedges included in AOCI$(43)$(216)$96
$422
Effective portion of cash flow hedges reclassified from AOCI to earnings

  
Interest rate contracts$(48)$(39)$(94)$(96)
Foreign exchange contracts(7)(46)(8)(89)
Total effective portion of cash flow hedges reclassified from AOCI to earnings(1)
$(55)$(85)$(102)$(185)
 Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2018201720182017
Amount of gain (loss) recognized in AOCI on derivative    
Interest rate contracts(1)
$(146)$(36)$(665)$103
Foreign exchange contracts(3)(7)(4)(7)
Total gain (loss) recognized in AOCI$(149)$(43)$(669)$96
Amount of gain (loss) reclassified from AOCI to earnings
Other
revenue
Net interest
revenue
Other
revenue
Other
revenue
Net interest
revenue
Other
revenue
Interest rate contracts(1)
$—
$(54)$(48)$—
$(142)$(94)
Foreign exchange contracts2
—
(7)(8)—
(8)
Total gain (loss) reclassified from AOCI into earnings$2
$(54)$(55)$(8)$(142)$(102)
(1)
IncludedAfter January 1, 2018, all amounts reclassified into earnings for interest rate contracts are included in Interest income/Interest expense (Net interest revenue). For all other hedges, including interest rate hedges prior to January 1, 2018, the amounts reclassified to earnings are included primarily in Other revenue and Net interest revenueon the Consolidated Income Statement.
For cash flow hedges, the changes in the fair value of the hedging derivative remain in AOCI on the Consolidated Balance Sheet and will be included in the earnings of future periods to offset the variability of the hedged cash flows when such cash flows affect earnings. The net gain (loss) associated with cash flow hedges expected to be reclassified from AOCI within 12 months of September 30, 20172018 is approximately $(277)$475 million. The maximum length of time over which forecasted cash flows are hedged is 10 years.
The after-tax impact of cash flow hedges on AOCI is shown in Note 17 to the Consolidated Financial Statements.


Net Investment Hedges
The pretax gain (loss) recorded in the Foreign currency translation adjustment account within AOCI, related to the effective portion of the net investment hedges, is $(46) million and $1,587 million for the three and nine months ended September 30, 2018, and $(245) million and $(1,993) million for the three and nine months ended September 30, 2017, and $(371) million and $(1,791) million for the three and nine months ended September 30, 2016, respectively.
 








Credit Derivatives
The following tables summarize the key characteristics of Citi’s credit derivatives portfolio by counterparty and derivative form:
Fair valuesNotionalsFair valuesNotionals
In millions of dollars at September 30, 2017
Receivable(1)
Payable(2)
Protection
purchased		Protection
sold
In millions of dollars at September 30, 2018
Receivable(1)
Payable(2)
Protection
purchased		Protection
sold
By industry/counterparty


   
Banks$9,114
$8,454
$320,482
$338,723
$5,366
$5,097
$222,802
$234,338
Broker-dealers2,882
2,805
89,352
100,408
1,826
1,661
66,676
67,833
Non-financial28
93
2,154
1,501
65
90
2,823
4,247
Insurance and other financial institutions11,232
14,198
502,079
431,942
4,309
4,845
501,491
416,642
Total by industry/counterparty$23,256
$25,550
$914,067
$872,574
$11,566
$11,693
$793,792
$723,060
By instrument


   
Credit default swaps and options$23,013
$24,365
$890,913
$862,753
$10,997
$11,168
$771,239
$712,451
Total return swaps and other243
1,185
23,154
9,821
569
525
22,553
10,609
Total by instrument$23,256
$25,550
$914,067
$872,574
$11,566
$11,693
$793,792
$723,060
By rating


   
Investment grade$13,045
$13,758
$696,474
$665,764
$5,180
$5,014
$616,595
$552,452
Non-investment grade10,211
11,792
217,593
206,810
6,386
6,679
177,197
170,608
Total by rating$23,256
$25,550
$914,067
$872,574
$11,566
$11,693
$793,792
$723,060
By maturity


   
Within 1 year$2,520
$3,225
$279,201
$267,863
$1,442
$1,680
$232,670
$204,358
From 1 to 5 years17,459
18,823
547,675
522,437
8,083
7,855
472,276
439,089
After 5 years3,277
3,502
87,191
82,274
2,041
2,158
88,846
79,613
Total by maturity$23,256
$25,550
$914,067
$872,574
$11,566
$11,693
$793,792
$723,060

(1)The fair value amount receivable is composed of $5,076$3,657 million under protection purchased and $18,180$7,909 million under protection sold.
(2)The fair value amount payable is composed of $20,616$8,476 million under protection purchased and $4,934$3,217 million under protection sold.


Fair valuesNotionalsFair valuesNotionals
In millions of dollars at December 31, 2016
Receivable(1)
Payable(2)
Protection
purchased		Protection
sold
In millions of dollars at December 31, 2017
Receivable(1)
Payable(2)
Protection
purchased		Protection
sold
By industry/counterparty


   
Banks$11,895
$10,930
$407,992
$414,720
$7,471
$6,669
$264,414
$273,711
Broker-dealers3,536
3,952
115,013
119,810
2,325
2,285
73,273
83,229
Non-financial82
99
4,014
2,061
70
91
1,288
1,140
Insurance and other financial institutions9,308
10,844
375,454
322,829
10,668
12,488
438,738
377,062
Total by industry/counterparty$24,821
$25,825
$902,473
$859,420
$20,534
$21,533
$777,713
$735,142
By instrument


   
Credit default swaps and options$24,502
$24,631
$883,719
$852,900
$20,251
$20,554
$754,114
$724,228
Total return swaps and other319
1,194
18,754
6,520
283
979
23,599
10,914
Total by instrument$24,821
$25,825
$902,473
$859,420
$20,534
$21,533
$777,713
$735,142
By rating


   
Investment grade$9,605
$9,995
$675,138
$648,247
$10,473
$10,616
$588,324
$557,987
Non-investment grade15,216
15,830
227,335
211,173
10,061
10,917
189,389
177,155
Total by rating$24,821
$25,825
$902,473
$859,420
$20,534
$21,533
$777,713
$735,142
By maturity


   
Within 1 year$4,113
$4,841
$293,059
$287,262
$2,477
$2,914
$231,878
$218,097
From 1 to 5 years17,735
17,986
551,155
523,371
16,098
16,435
498,606
476,345
After 5 years2,973
2,998
58,259
48,787
1,959
2,184
47,229
40,700
Total by maturity$24,821
$25,825
$902,473
$859,420
$20,534
$21,533
$777,713
$735,142

(1)The fair value amount receivable is composed of $9,077$3,195 million under protection purchased and $15,744 million$17,339 under protection sold.
(2)The fair value amount payable is composed of $17,110$3,147 million under protection purchased and $8,715$18,386 million under protection sold.


Credit-Risk-RelatedCredit Risk-Related Contingent Features in Derivatives
Certain derivative instruments contain provisions that require the Company to either post additional collateral or immediately settle any outstanding liability balances upon the occurrence of a specified event related to the credit risk of the Company. These events, which are defined by the existing derivative contracts, are primarily downgrades in the credit ratings of the Company and its affiliates.
The fair value (excluding CVA) of all derivative instruments with credit-risk-relatedcredit risk-related contingent features that were in a net liability position at both September 30, 20172018 and December 31, 20162017 was $28$37 billion and $26$29 billion, respectively. The Company posted $25$36 billion and $26$28 billion as collateral for this exposure in the normal course of business as of September 30, 20172018 and December 31, 2016,2017, respectively.
A downgrade could trigger additional collateral or cash settlement requirements for the Company and certain affiliates. In the event that Citigroup and Citibank were downgraded a single notch by all three major rating agencies as of September 30, 2017,2018, the Company could be required to post an additional $1.2$1.4 billion as either collateral or settlement of the derivative transactions. Additionally, the Company could be required to segregate with third-party custodians collateral previously received from existing derivative counterparties in the amount of $0.3$0.2 billion upon the single notch downgrade, resulting in aggregate cash obligations and collateral requirements of approximately $1.5$1.6 billion.


Derivatives Accompanied by Financial Asset Transfers
For transfers of financial assets accounted for as a sale by the Company whereand for which the Company has retained substantially all of the economic exposure to the transferred asset through a total return swap executed with the same counterparty in contemplation of the initial sale with the same counterparty and(and still outstanding as of September 30, 2017,outstanding), both the asset carrying amounts derecognized and the gross cash proceeds received as of the date of derecognition were $2.4 billion. $3.3 billion and $3.0 billion as of September 30, 2018 and December 31, 2017, respectively.
At September 30, 2018, the fair value of these previously derecognized assets was $3.2 billion. The fair value of the total return swaps as of September 30, 2018 was $24 million recorded as gross derivative assets and $31 million recorded as gross derivative liabilities. At December 31, 2017, the fair value of these previously derecognized assets was $2.4 billion. The$3.1 billion, and the fair value of the total return swaps was $28$89 million recorded as gross derivative assets and $47$15 million recorded as gross derivative liabilities.
The balances for the total return swaps are on a gross basis, before the application of counterparty and cash collateral netting, and are included primarily as equity derivatives in the tabular disclosures in this Note.



20.   FAIR VALUE MEASUREMENT
For additional information regarding fair value measurement at Citi, see Note 24 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.

Market Valuation Adjustments
The table below summarizes the credit valuation adjustments (CVA) and funding valuation adjustments (FVA) applied to the fair value of derivative instruments at September 30, 20172018 and December 31, 2016:2017:
Credit and funding valuation adjustments
contra-liability (contra-asset)
Credit and funding valuation adjustments
contra-liability (contra-asset)
In millions of dollarsSeptember 30,
2017		December 31,
2016		September 30,
2018		December 31,
2017
Counterparty CVA$(1,114)$(1,488)$(815)$(970)
Asset FVA(462)(536)(324)(447)
Citigroup (own-credit) CVA318
459
317
287
Liability FVA51
62
39
47
Total CVA—derivative instruments(1)
$(1,207)$(1,503)$(783)$(1,083)

(1)FVA is included with CVA for presentation purposes.

The table below summarizes pretax gains (losses) related to changes in CVA on derivative instruments, net of hedges, FVA on derivatives and debt valuation adjustments (DVA) on Citi’s own fair value option (FVO) liabilities for the periods indicated:
Credit/funding/debt valuation
adjustments gain (loss)
Credit/funding/debt valuation
adjustments gain (loss)
Three Months Ended September 30,Nine Months Ended 
 September 30,		Three Months Ended September 30,Nine Months Ended 
 September 30,
In millions of dollars20172016201720162018201720182017
Counterparty CVA$27
$112
$197
$19
$94
$27
$117
$197
Asset FVA(5)37
74
(59)74
(5)123
74
Own-credit CVA(2)(60)(127)65
(75)(2)24
(127)
Liability FVA(16)(59)(10)(11)(23)(16)(8)(10)
Total CVA—derivative instruments$4
$30
$134
$14
$70
$4
$256
$134
DVA related to own FVO liabilities (1)
$(195)$(319)$(422)$8
$(377)$(195)$208
$(422)
Total CVA and DVA(2)
$(191)$(289)$(288)$22
$(307)$(191)$464
$(288)

(1)See Note 1 and Note 17 to the Consolidated Financial Statements.
(2)FVA is included with CVA for presentation purposes.





Items Measured at Fair Value on a Recurring Basis
The following tables present for each of the fair value hierarchy levels the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 20172018 and December 31, 2016.2017. The Company may hedge positions that have been classified in the Level 3 category with other financial instruments (hedging instruments) that may be
 
classified as Level 3, but also with financial instruments classified as Level 1 or Level 2 of the fair value hierarchy. The effects of these hedges are presented gross in the following tables:


Fair Value Levels
In millions of dollars at September 30, 2017
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
In millions of dollars at September 30, 2018
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
Assets    
Federal funds sold and securities borrowed or purchased under agreements to resell$—
$205,951
$664
$206,615
$(50,283)$156,332
Federal funds sold and securities borrowed and purchased under agreements to resell$—
$241,745
$65
$241,810
$(63,368)$178,442
Trading non-derivative assets    
Trading mortgage-backed securities    
U.S. government-sponsored agency guaranteed—
21,991
309
22,300
—
22,300
—
20,293
128
20,421
—
20,421
Residential—
529
351
880
—
880
1
730
215
946
—
946
Commercial—
1,061
112
1,173
—
1,173
—
1,346
57
1,403
—
1,403
Total trading mortgage-backed securities$—
$23,581
$772
$24,353
$—
$24,353
$1
$22,369
$400
$22,770
$—
$22,770
U.S. Treasury and federal agency securities$22,398
$2,999
$—
$25,397
$—
$25,397
$22,054
$5,347
$6
$27,407
$—
$27,407
State and municipal—
2,429
270
2,699
—
2,699
—
3,612
200
3,812
—
3,812
Foreign government45,503
18,525
95
64,123
—
64,123
44,714
19,945
52
64,711
—
64,711
Corporate247
14,924
391
15,562
—
15,562
835
13,409
253
14,497
—
14,497
Equity securities47,941
7,427
236
55,604
—
55,604
45,556
8,195
170
53,921
—
53,921
Asset-backed securities—
1,347
1,704
3,051
—
3,051
—
1,628
1,453
3,081
—
3,081
Other trading assets(3)
3
10,034
2,151
12,188
—
12,188
5
10,355
730
11,090
—
11,090
Total trading non-derivative assets$116,092
$81,266
$5,619
$202,977
$—
$202,977
$113,165
$84,860
$3,264
$201,289
$—
$201,289
Trading derivatives
  
  
Interest rate contracts$147
$206,086
$1,749
$207,982
  $183
$163,345
$2,313
$165,841
  
Foreign exchange contracts42
133,963
568
134,573
  6
174,455
510
174,971
  
Equity contracts2,110
24,606
568
27,284
  2,495
27,255
294
30,044
  
Commodity contracts280
11,598
311
12,189
  15
22,576
684
23,275
  
Credit derivatives—
22,113
1,098
23,211
  —
10,750
816
11,566
  
Total trading derivatives$2,579
$398,366
$4,294
$405,239
  $2,699
$398,381
$4,617
$405,697
  
Cash collateral paid(4)
 $13,991
   $10,759
  
Netting agreements $(325,424)  $(322,565) 
Netting of cash collateral received (37,876)  (37,678) 
Total trading derivatives$2,579
$398,366
$4,294
$419,230
$(363,300)$55,930
$2,699
$398,381
$4,617
$416,456
$(360,243)$56,213
Investments    
Mortgage-backed securities    
U.S. government-sponsored agency guaranteed$—
$42,257
$57
$42,314
$—
$42,314
$—
$45,127
$34
$45,161
$—
$45,161
Residential—
2,992
—
2,992
—
2,992
—
1,627
—
1,627
—
1,627
Commercial—
341
3
344
—
344
—
226
5
231
—
231
Total investment mortgage-backed securities$—
$45,590
$60
$45,650
$—
$45,650
$—
$46,980
$39
$47,019
$—
$47,019
U.S. Treasury and federal agency securities$107,085
$11,241
$—
$118,326
$—
$118,326
$106,098
$10,045
$—
$116,143
$—
$116,143
State and municipal—
7,918
1,272
9,190
—
9,190
—
8,798
682
9,480
—
9,480
Foreign government58,869
41,577
301
100,747
—
100,747
56,866
37,514
81
94,461
—
94,461
Corporate2,342
12,997
120
15,459
—
15,459
4,687
7,693
—
12,380
—
12,380
Equity securities287
14
3
304
—
304
246
14
—
260
—
260
Asset-backed securities—
4,461
830
5,291
—
5,291
—
978
284
1,262
—
1,262
Other debt securities—
338
10
348
—
348
—
4,037
—
4,037
—
4,037
Non-marketable equity securities(5)
—
66
829
895
—
895
—
170
733
903
—
903
Total investments$168,583
$124,202
$3,425
$296,210
$—
$296,210
$167,897
$116,229
$1,819
$285,945
$—
$285,945
Table continues on the next page.


In millions of dollars at September 30, 2017
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
In millions of dollars at September 30, 2018
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
Loans$—
$3,764
$544
$4,308
$—
$4,308
$—
$3,856
$383
$4,239
$—
$4,239
Mortgage servicing rights—
—
553
553
—
553
—
—
618
618
—
618
Non-trading derivatives and other financial assets measured on a recurring basis, gross$14,434
$6,981
$14
$21,429
  
Cash collateral paid(6)
 —
  
Netting of cash collateral received $(1,005) 
Non-trading derivatives and other financial assets measured on a recurring basis$14,434
$6,981
$14
$21,429
$(1,005)$20,424
$19,789
$5,362
$—
$25,151
$—
$25,151
Total assets$301,688
$820,530
$15,113
$1,151,322
$(414,588)$736,734
$303,550
$850,433
$10,766
$1,175,508
$(423,611)$751,897
Total as a percentage of gross assets(7)
26.5%72.1%1.3%





Total as a percentage of gross assets(6)
26.1%73.0%0.9%





Liabilities    
Interest-bearing deposits$—
$1,197
$300
$1,497
$—
$1,497
$—
$1,137
$303
$1,440
$—
$1,440
Federal funds purchased and securities loaned or sold under agreements to repurchase—
94,843
765
95,608
(50,283)45,325
Federal funds purchased and securities loaned and sold under agreements to repurchase—
110,519
997
111,516
(63,368)48,148
Trading account liabilities    
Securities sold, not yet purchased73,549
9,688
684
83,921
—
83,921
85,760
10,281
387
96,428
—
96,428
Other trading liabilities—
3,035
—
3,035
—
3,035
—
1,484
—
1,484
—
1,484
Total trading liabilities$73,549
$12,723
$684
$86,956
$—
$86,956
$85,760
$11,765
$387
$97,912
$—
$97,912
Trading derivatives    
Interest rate contracts$118
$185,681
$1,950
$187,749
  $189
$145,460
$2,194
$147,843
  
Foreign exchange contracts50
132,666
420
133,136
  7
168,557
321
168,885
  
Equity contracts2,116
27,984
2,416
32,516
  2,667
31,254
1,208
35,129
  
Commodity contracts166
12,428
2,650
15,244
  5
23,286
2,489
25,780
  
Credit derivatives—
23,146
2,039
25,185
  —
9,871
1,822
11,693
  
Total trading derivatives$2,450
$381,905
$9,475
$393,830
  $2,868
$378,428
$8,034
$389,330
  
Cash collateral received(8)
 $15,848
  
Cash collateral received(7)
 $13,676
  
Netting agreements $(325,424)  $(322,565) 
Netting of cash collateral paid (32,390)  (30,701) 
Total trading derivatives$2,450
$381,905
$9,475
$409,678
$(357,814)$51,864
$2,868
$378,428
$8,034
$403,006
$(353,266)$49,740
Short-term borrowings$—
$4,771
$56
$4,827
$—
$4,827
$—
$5,002
$39
$5,041
$—
$5,041
Long-term debt—
19,505
11,321
30,826
—
30,826
—
22,980
13,791
36,771
—
36,771
Non-trading derivatives and other financial liabilities measured on a recurring basis, gross$14,434
$716
$2
$15,152
  
Cash collateral received(9)
 9
  
Netting of cash collateral paid $(17) 
Total non-trading derivatives and other financial liabilities measured on a recurring basis$14,434
$716
$2
$15,161
$(17)$15,144
$19,789
$158
$—
$19,947
$—
$19,947
Total liabilities$90,433
$515,660
$22,603
$644,553
$(408,114)$236,439
$108,417
$529,989
$23,551
$675,633
$(416,634)$258,999
Total as a percentage of gross liabilities(7)
14.4%82.0%3.6%  
Total as a percentage of gross liabilities(6)
16.4%80.1%3.6%  

(1)
For the three and nine months ended September 30, 2017,2018, the Company transferred assets of approximately $0.6$1.7 billion and $3.6$3.4 billion from Level 1 to Level 2, primarily related to foreign government securities and equity securities not traded in active markets. During the three and nine months ended September 30, 2017,2018, the Company transferred assets of approximately $0.9$2.6 billion and $3.1$7.9 billion from Level 2 to Level 1, primarily related to foreign government bonds, foreign corporate securities, marketable certificates of deposits and equity securities traded with sufficient frequency to constitute an active market. For the three and nine months ended September 30, 2017, the Company transferred liabilities of approximately $0.22018, there were $0.1 billion and $0.3 billion transfers of liabilities from Level 1 to Level 2. During the three and nine months ended September 30, 2017,2018, the Company transferred liabilities of approximately $0.1$0.3 billion and $0.2$0.7 billion, from Level 2 to Level 1.
(2)Represents netting of (i) the amounts due under securities purchased under agreements to resell and the amounts owed under securities sold under agreements to repurchase;repurchase and (ii) derivative exposures covered by a qualifying master netting agreement and cash collateral offsetting.
(3)Includes positions related to investments in unallocated precious metals, as discussed in Note 21 to the Consolidated Financial Statements. Also includes physical commodities accounted for at the lower of cost or fair value and unfunded credit products.
(4)Reflects the net amount of $46,381$48,437 million gross cash collateral paid, of which $32,390$37,678 million was used to offset trading derivative liabilities.
(5)
Amounts exclude $0.40.2 billion of investments measured at Net Asset Value (NAV) in accordance with ASU No. 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent).
(6)Reflects the net amount of $17 million of gross cash collateral paid, all of which was used to offset non-trading derivative liabilities.
(7)Because the amount of the cash collateral paid/received has not been allocated to the Level 1, 2 and 3 subtotals, these percentages are calculated based on total assets and liabilities measured at fair value on a recurring basis, excluding the cash collateral paid/received on derivatives.


(8)(7)Reflects the net amount $53,724$44,377 million of gross cash collateral received, of which $37,876$30,701 million was used to offset trading derivative assets.
(9)Reflects the net amount of $1,014 million of gross cash collateral received, of which $1,005 million was used to offset non-trading derivative assets.



Fair Value Levels
In millions of dollars at December 31, 2016
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
In millions of dollars at December 31, 2017
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
Assets    
Federal funds sold and securities borrowed or purchased under agreements to resell$—
$172,394
$1,496
$173,890
$(40,686)$133,204
Federal funds sold and securities borrowed and purchased under agreements to resell$—
$188,571
$16
$188,587
$(55,638)$132,949
Trading non-derivative assets    
Trading mortgage-backed securities    
U.S. government-sponsored agency guaranteed—
22,718
176
22,894
—
22,894
—
22,801
163
22,964
—
22,964
Residential—
291
399
690
—
690
—
649
164
813
—
813
Commercial—
1,000
206
1,206
—
1,206
—
1,309
57
1,366
—
1,366
Total trading mortgage-backed securities$—
$24,009
$781
$24,790
$—
$24,790
$—
$24,759
$384
$25,143
$—
$25,143
U.S. Treasury and federal agency securities$16,368
$4,811
$1
$21,180
$—
$21,180
$17,524
$3,613
$—
$21,137
$—
$21,137
State and municipal—
3,780
296
4,076
—
4,076
—
4,426
274
4,700
—
4,700
Foreign government32,164
17,492
40
49,696
—
49,696
39,347
20,843
16
60,206
—
60,206
Corporate424
14,199
324
14,947
—
14,947
301
15,129
275
15,705
—
15,705
Equity securities45,056
5,260
127
50,443
—
50,443
53,305
6,794
120
60,219
—
60,219
Asset-backed securities—
892
1,868
2,760
—
2,760
—
1,198
1,590
2,788
—
2,788
Other trading assets(3)
—
9,466
2,814
12,280
—
12,280
3
11,105
615
11,723
—
11,723
Total trading non-derivative assets$94,012
$79,909
$6,251
$180,172
$—
$180,172
$110,480
$87,867
$3,274
$201,621
$—
$201,621
Trading derivatives    
Interest rate contracts$105
$366,995
$2,225
$369,325
  $145
$203,134
$1,708
$204,987
  
Foreign exchange contracts53
184,776
833
185,662
  19
121,363
577
121,959
  
Equity contracts2,306
21,209
595
24,110
  2,364
24,170
444
26,978
  
Commodity contracts261
12,999
505
13,765
  282
13,252
569
14,103
  
Credit derivatives—
23,021
1,594
24,615
  —
19,624
910
20,534
  
Total trading derivatives$2,725
$609,000
$5,752
$617,477
  $2,810
$381,543
$4,208
$388,561
  
Cash collateral paid(4)
 $11,188
   $7,541
  
Netting agreements $(519,000)  $(306,401) 
Netting of cash collateral received (45,912)  (38,532) 
Total trading derivatives$2,725
$609,000
$5,752
$628,665
$(564,912)$63,753
$2,810
$381,543
$4,208
$396,102
$(344,933)$51,169
Investments    
Mortgage-backed securities    
U.S. government-sponsored agency guaranteed$—
$38,304
$101
$38,405
$—
$38,405
$—
$41,717
$24
$41,741
$—
$41,741
Residential—
3,860
50
3,910
—
3,910
—
2,884
—
2,884
—
2,884
Commercial—
358
—
358
—
358
—
329
3
332
—
332
Total investment mortgage-backed securities$—
$42,522
$151
$42,673
$—
$42,673
$—
$44,930
$27
$44,957
$—
$44,957
U.S. Treasury and federal agency securities$112,916
$10,753
$2
$123,671
$—
$123,671
$106,964
$11,182
$—
$118,146
$—
$118,146
State and municipal—
8,909
1,211
10,120
—
10,120
—
8,028
737
8,765
—
8,765
Foreign government54,028
43,934
186
98,148
—
98,148
56,456
43,985
92
100,533
—
100,533
Corporate3,215
13,598
311
17,124
—
17,124
1,911
12,127
71
14,109
—
14,109
Equity securities336
46
9
391
—
391
176
11
2
189
—
189
Asset-backed securities—
6,134
660
6,794
—
6,794
—
3,091
827
3,918
—
3,918
Other debt securities—
503
—
503
—
503
—
297
—
297
—
297
Non-marketable equity securities(5)
—
35
1,331
1,366
—
1,366
—
121
681
802
—
802
Total investments$170,495
$126,434
$3,861
$300,790
$—
$300,790
$165,507
$123,772
$2,437
$291,716
$—
$291,716
Table continues on the next page.


In millions of dollars at December 31, 2016
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
In millions of dollars at December 31, 2017
Level 1(1)
Level 2(1)
Level 3Gross
inventory
Netting(2)
Net
balance
Loans$—
$2,918
$568
$3,486
$—
$3,486
$—
$3,824
$550
$4,374
$—
$4,374
Mortgage servicing rights—
—
1,564
1,564
—
1,564
—
—
558
558
—
558
Non-trading derivatives and other financial assets measured on a recurring basis, gross$9,300
$7,732
$34
$17,066
  
Cash collateral paid(6)
 8
  
Netting of cash collateral received $(1,345) 
Non-trading derivatives and other financial assets measured on a recurring basis$9,300
$7,732
$34
$17,074
$(1,345)$15,729
$13,903
$4,640
$16
$18,559
$—
$18,559
Total assets$276,532
$998,387
$19,526
$1,305,641
$(606,943)$698,698
$292,700
$790,217
$11,059
$1,101,517
$(400,571)$700,946
Total as a percentage of gross assets(7)
21.4%77.1%1.5%  
Total as a percentage of gross assets(6)
26.8%72.2%1.0%  
Liabilities    
Interest-bearing deposits$—
$919
$293
$1,212
$—
$1,212
$—
$1,179
$286
$1,465
$—
$1,465
Federal funds purchased and securities loaned or sold under agreements to repurchase—
73,500
849
74,349
(40,686)33,663
Federal funds purchased and securities loaned and sold under agreements to repurchase—
95,550
726
96,276
(55,638)40,638
Trading account liabilities    
Securities sold, not yet purchased67,429
12,184
1,177
80,790
—
80,790
65,843
10,306
22
76,171
—
76,171
Other trading liabilities—
1,827
1
1,828
—
1,828
—
1,409
5
1,414
—
1,414
Total trading liabilities$67,429
$14,011
$1,178
$82,618
$—
$82,618
$65,843
$11,715
$27
$77,585
$—
$77,585
Trading account derivatives    
Interest rate contracts$107
$351,766
$2,888
$354,761
  $137
$182,372
$2,130
$184,639
  
Foreign exchange contracts13
187,328
420
187,761
  9
120,316
447
120,772
  
Equity contracts2,245
22,119
2,152
26,516
  2,430
26,472
2,471
31,373
  
Commodity contracts196
12,386
2,450
15,032
  115
14,482
2,430
17,027
  
Credit derivatives—
22,842
2,595
25,437
  —
19,824
1,709
21,533
  
Total trading derivatives$2,561
$596,441
$10,505
$609,507
  $2,691
$363,466
$9,187
$375,344
  
Cash collateral received(8)
 $15,731
  
Cash collateral received(7)
 $14,308
  
Netting agreements $(519,000)  $(306,401) 
Netting of cash collateral paid (49,811)  (35,666) 
Total trading derivatives$2,561
$596,441
$10,505
$625,238
$(568,811)$56,427
$2,691
$363,466
$9,187
$389,652
$(342,067)$47,585
Short-term borrowings$—
$2,658
$42
$2,700
$—
$2,700
$—
$4,609
$18
$4,627
$—
$4,627
Long-term debt—
16,510
9,744
26,254
—
26,254
—
18,310
13,082
31,392
—
31,392
Non-trading derivatives and other financial liabilities measured on a recurring basis, gross$9,300
$1,540
$8
$10,848
  
Cash collateral received(9)
 1
  
Netting of cash collateral paid $(53) 
Non-trading derivatives and other financial liabilities measured on a recurring basis$9,300
$1,540
$8
$10,849
$(53)$10,796
$13,903
$50
$8
$13,961
$—
$13,961
Total liabilities$79,290
$705,579
$22,619
$823,220
$(609,550)$213,670
$82,437
$494,879
$23,334
$614,958
$(397,705)$217,253
Total as a percentage of gross liabilities(7)
9.8%87.4%2.8%  
Total as a percentage of gross liabilities(6)
13.7%82.4%3.9%  

(1)In 2016,2017, the Company transferred assets of approximately $2.6$4.8 billion from Level 1 to Level 2, primarily related to foreign government securities and equity securities not traded in active markets. In 2016,2017, the Company transferred assets of approximately $4.0 billion from Level 2 to Level 1, primarily related to foreign government bonds and equity securities traded with sufficient frequency to constitute a liquid market. In 2016,2017, the Company transferred liabilities of approximately $0.4 billion from Level 21 to Level 1.2. In 2016,2017, the Company transferred liabilities of approximately $0.3 billion from Level 12 to Level 2.1.
(2)Represents netting of (i) the amounts due under securities purchased under agreements to resell and the amounts owed under securities sold under agreements to repurchase;repurchase and (ii) derivative exposures covered by a qualifying master netting agreement and cash collateral offsetting.
(3)Includes positions related to investments in unallocated precious metals, as discussed in Note 21 to the Consolidated Financial Statements. Also includes physical commodities accounted for at the lower of cost or fair value and unfunded credit products.
(4)Reflects the net amount of $60,999$43,207 million of gross cash collateral paid, of which $49,811$35,666 million was used to offset trading derivative liabilities.
(5)
Amounts exclude $0.4 billion of investments measured at Net Asset Value (NAV) in accordance with ASU No. 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent).
(6)
Reflects the net amount of $61 million of gross cash collateral paid, of which $53 million was used to offset non-trading derivative liabilities.
(7)Because the amount of the cash collateral paid/received has not been allocated to the Level 1, 2 and 3 subtotals, these percentages are calculated based on total assets and liabilities measured at fair value on a recurring basis, excluding the cash collateral paid/received on derivatives.
(8)(7)Reflects the net amount of $61,643$52,840 million of gross cash collateral received, of which $45,912$38,532 million was used to offset trading derivative assets.
(9)Reflects the net amount of $1,346 million of gross cash collateral received, of which $1,345 million was used to offset non-trading derivative assets.



Changes in Level 3 Fair Value Category

The following tables present the changes in the Level 3 fair value category for the three and nine months ended September 30, 20172018 and 2016.2017. The gains and losses presented below include changes in the fair value related to both observable and unobservable inputs.
The Company often hedges positions with offsetting positions that are classified in a different level. For example,
the gains and losses for assets and liabilities in the Level 3
category presented in the tables below do not reflect the effect of offsetting losses and gains on hedging instruments that may be classified in the Level 1 or Level 2 categories. In addition, the Company hedges items classified in the Level 3 category with instruments also classified in Level 3 of the fair value hierarchy. The hedged items and related hedges are presented gross in the following tables:

Level 3 Fair Value Rollforward
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsJun. 30, 2017Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017Jun. 30, 2018Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2018
Assets      
Federal funds sold and
securities borrowed or
purchased under
agreements to resell
$1,002
$(338)$—
$—
$—
$—
$—
$—
$—
$664
$(338)
Federal funds sold and
securities borrowed and
purchased under
agreements to resell
$66
$—
$—
$(1)$—
$61
$—
$—
$(61)$65
$4
Trading non-derivative assets      
Trading mortgage-
backed securities
      
U.S. government-sponsored agency guaranteed204
—
—
75
(21)174
—
(123)—
309
—
99
(2)—
3
(7)38
—
(3)—
128
(2)
Residential327
24
—
41
(9)39
—
(71)—
351
12
132
111
—
17
(36)8
—
(17)—
215
(2)
Commercial318
10
—
22
(17)11
—
(232)—
112
5
51
(2)—
4
(8)29
—
(17)—
57
(1)
Total trading mortgage-
backed securities
$849
$34
$—
$138
$(47)$224
$—
$(426)$—
$772
$17
$282
$107
$—
$24
$(51)$75
$—
$(37)$—
$400
$(5)
U.S. Treasury and federal agency securities$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$7
$—
$—
$—
$—
$—
$—
$—
$(1)$6
$—
State and municipal284
(2)—
—
—
49
—
(61)—
270
(1)226
6
—
—
(52)22
—
(2)—
200
6
Foreign government108
(5)—
4
(114)161
—
(59)—
95
(2)36
27
—
—
(8)4
—
(7)—
52
26
Corporate401
105
—
16
(11)148
—
(268)—
391
103
520
(214)—
24
(15)110
—
(172)—
253
7
Equity securities240
183
—
3
(41)29
—
(178)—
236
6
293
(87)—
7
(21)24
—
(46)—
170
(99)
Asset-backed securities1,570
114
—
5
(6)481
—
(460)—
1,704
26
1,688
(44)—
20
(39)305
—
(477)—
1,453
(45)
Other trading assets1,803
(38)—
38
(607)1,349
4
(394)(4)2,151
29
542
78
—
94
(10)185
2
(157)(4)730
53
Total trading non-
derivative assets
$5,255
$391
$—
$204
$(826)$2,441
$4
$(1,846)$(4)$5,619
$178
$3,594
$(127)$—
$169
$(196)$725
$2
$(898)$(5)$3,264
$(57)
Trading derivatives, net(4)
      
Interest rate contracts$(288)$196
$—
$4
$(4)$25
$—
$(20)$(114)$(201)$120
$86
$10
$—
$(11)$(2)$—
$8
$—
$28
$119
$59
Foreign exchange contracts184
(92)—
1
(4)(6)—
(3)68
148
(92)239
(16)—
(15)56
4
—
(66)(13)189
(51)
Equity contracts(1,647)201
—
(52)(34)31
—
(126)(221)(1,848)(10)(1,446)265
—
3
372
3
(15)(3)(93)(914)283
Commodity contracts(2,024)(248)—
(29)(10)—
—
(3)(25)(2,339)(255)(1,906)(67)—
44
(16)12
—
(8)136
(1,805)1
Credit derivatives(1,339)(150)—
25
115
7
—
—
401
(941)(185)(848)(240)—
(6)7
—
—
—
81
(1,006)(231)
Total trading derivatives,
net(4)
$(5,114)$(93)$—
$(51)$63
$57
$—
$(152)$109
$(5,181)$(422)$(3,875)$(48)$—
$15
$417
$19
$(7)$(77)$139
$(3,417)$61
Table continues on the next page.









 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsJun. 30, 2017Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017Jun. 30, 2018Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2018
Investments    
Mortgage-backed securities    
U.S. government-sponsored agency guaranteed$50
$—
$12
$—
$(5)$—
$—
$—
$—
$57
$28
$34
$—
$—
$—
$—
$—
$—
$—
$—
$34
$—
Residential—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Commercial—
—
—
3
—
—
—
—
—
3
—
6
—
—
—
(1)—
—
—
—
5
—
Total investment mortgage-backed securities$50
$—
$12
$3
$(5)$—
$—
$—
$—
$60
$28
$40
$—
$—
$—
$(1)$—
$—
$—
$—
$39
$—
U.S. Treasury and federal agency securities$1
$—
$—
$—
$—
$—
$—
$(1)$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
State and municipal1,285
—
(2)21
(3)16
—
(45)—
1,272
17
762
—
(10)—
—
17
—
(87)—
682
(7)
Foreign government358
—
(58)—
(18)122
—
(103)—
301
(7)54
—
(3)—
(2)45
—
(13)—
81
(3)
Corporate156
—
146
10
(2)41
—
(231)—
120
—
68
—
—
—
(64)—
—
(4)—
—
—
Equity securities9
—
(1)—
—
—
—
(5)—
3
—
1
—
—
—
—
—
—
—
(1)—
—
Asset-backed securities1,028
—
(280)2
(7)504
—
(417)—
830
(134)456
—
(6)—
(177)34
—
(23)—
284
(5)
Other debt securities10
—
—
—
—
—
—
—
—
10
—
—
—
—
—
—
—
—
—
—
—
—
Non-marketable equity securities939
—
(61)—
—
1
—
(1)(49)829
(18)611
—
(73)163
—
71
—
(40)1
733
(70)
Total investments$3,836
$—
$(244)$36
$(35)$684
$—
$(803)$(49)$3,425
$(114)$1,992
$—
$(92)$163
$(244)$167
$—
$(167)$—
$1,819
$(85)
Loans$577
$—
$73
$—
$—
$131
$—
$(236)$(1)$544
$264
$381
$—
$(27)$—
$(46)$79
$—
$(3)$(1)$383
$95
Mortgage servicing rights560
—
(6)—
—
—
19
—
(20)553
3
596
—
25
—
—
—
14
—
(17)618
26
Other financial assets measured on a recurring basis17
—
13
—
—
1
43
(4)(56)14
17
—
—
15
—
—
—
—
(4)(11)—
14
Liabilities



Interest-bearing deposits$300
$—
$(2)$—
$—
$—
$—
$—
$(2)$300
$6
$320
$—
$14
$—
$—
$—
$—
$—
$(3)$303
$14
Federal funds purchased and securities loaned or sold under agreements to repurchase807
(1)—
—
—
—
—
—
(43)765
4
Federal funds purchased and securities loaned and sold under agreements to repurchase966
(31)—
—
—
—
—
—
—
997
24
Trading account liabilities



Securities sold, not yet purchased1,143
496
—
5
(10)—
—
88
(46)684
24
189
(137)—
28
(55)14
121
(45)(2)387
(90)
Other trading liabilities—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Short-term borrowings29
(13)—
3
(1)—
12
—
—
56
7
90
1
—
—
(18)—
5
—
(37)39
19
Long-term debt11,831
1,057
—
181
(490)—
419
—
437
11,321
716
13,781
(231)—
445
(646)—
(42)(1)23
13,791
(298)
Other financial liabilities measured on a recurring basis2
—
—
—
—
—
1
—
(1)2
(1)—
—
—
—
—
—
—
—
—
—
—

(1)
Changes in fair value forof available-for-sale investmentsdebt securities are recorded in AOCI, unless related to other-than-temporary impairment, while gains and losses from sales are recorded in Realized gains (losses) from sales of investments on the Consolidated Statement of Income.
(2)
Unrealized gains (losses) on MSRs are recorded in Other revenue on the Consolidated Statement of Income.
(3)Represents the amount of total gains or losses for the period, included in earnings (and AOCI for changes in fair value of available-for-sale investments)debt securities), attributable to the change in fair value relating to assets and liabilities classified as Level 3 that are still held at September 30, 2017.2018.
(4)Total Level 3 trading derivative assets and liabilities have been netted in these tables for presentation purposes only.





  Net realized/unrealized
gains (losses) incl. in		Transfers     
Unrealized
gains
(losses)
still held(3)
In millions of dollarsDec. 31, 2016Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017
Assets           
Federal funds sold and securities borrowed or purchased under agreements to resell$1,496
$(340)$—
$—
$(491)$—
$—
$—
$(1)$664
$—
Trading non-derivative assets           
Trading mortgage-backed securities           
U.S. government-sponsored agency guaranteed176
4
—
154
(86)438
—
(377)—
309
1
Residential399
61
—
88
(58)105
—
(244)—
351
35
Commercial206
7
—
66
(46)445
—
(566)—
112
(5)
Total trading mortgage-backed securities$781
$72
$—
$308
$(190)$988
$—
$(1,187)$—
$772
$31
U.S. Treasury and federal agency securities$1
$—
$—
$—
$—
$—
$—
$(1)$—
$—
$—
State and municipal296
3
—
24
(48)137
—
(142)—
270
(1)
Foreign government40
2
—
88
(204)288
—
(119)—
95
(1)
Corporate324
320
—
132
(84)424
—
(725)—
391
167
Equity securities127
212
—
135
(54)38
—
(222)—
236
20
Asset-backed securities1,868
251
—
28
(87)1,185
—
(1,541)—
1,704
34
Other trading assets2,814
(88)—
470
(1,381)2,002
5
(1,652)(19)2,151
29
Total trading non-derivative assets$6,251
$772
$—
$1,185
$(2,048)$5,062
$5
$(5,589)$(19)$5,619
$279
Trading derivatives, net(4)
           
Interest rate contracts$(663)$4
$—
$(24)$647
$90
$—
$(225)$(30)$(201)$65
Foreign exchange contracts413
(389)—
54
(63)32
—
(37)138
148
(134)
Equity contracts(1,557)98
—
(34)(8)180
—
(263)(264)(1,848)(22)
Commodity contracts(1,945)(576)—
29
39
—
—
(3)117
(2,339)(255)
Credit derivatives(1,001)(535)—
(43)91
5
—
2
540
(941)(197)
Total trading derivatives, net(4)
$(4,753)$(1,398)$—
$(18)$706
$307
$—
$(526)$501
$(5,181)$(543)
Investments           
Mortgage-backed securities           
U.S. government-sponsored agency guaranteed$101
$—
$15
$1
$(60)$—
$—
$—
$—
$57
$30
Residential50
—
2
—
(47)—
—
(5)—
—
—
Commercial—
—
—
3
—
8
—
(8)—
3
—
Total investment mortgage-backed securities$151
$—
$17
$4
$(107)$8
$—
$(13)$—
$60
$30
U.S. Treasury and federal agency securities$2
$—
$—
$—
$—
$—
$—
$(2)$—
$—
$—
State and municipal1,211
—
37
70
(36)92
—
(102)—
1,272
35
Foreign government186
—
(47)2
(37)455
—
(258)—
301
(5)
Corporate311
—
11
74
(6)224
—
(494)—
120
—
Equity securities9
—
(1)—
—
—
—
(5)—
3
—
Asset-backed securities660
—
(98)23
(20)864
—
(599)—
830
(134)
Other debt securities—
—
—
—
—
21
—
(11)—
10
—
Non-marketable equity securities1,331
—
(124)2
—
10
—
(228)(162)829
49
Total investments$3,861
$—
$(205)$175
$(206)$1,674
$—
$(1,712)$(162)$3,425
$(25)
Table continues on the next page.
  Net realized/unrealized
gains (losses) incl. in		Transfers     
Unrealized
gains
(losses)
still held(3)
In millions of dollarsDec. 31, 2017Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2018
Assets 
 
 
 
 
 
 
 
 
 
 
Federal funds sold and securities borrowed and purchased under agreements to resell16
19
—
48
—
61
—
—
(79)65
10
Trading non-derivative assets           
Trading mortgage-backed securities           
U.S. government-sponsored agency guaranteed163
—
—
92
(97)191
—
(221)—
128
—
Residential164
116
—
75
(124)99
—
(115)—
215
(1)
Commercial57
(3)—
15
(45)67
—
(34)—
57
2
Total trading mortgage-backed securities384
113
—
182
(266)357
—
(370)—
400
1
U.S. Treasury and federal agency securities—
—
—
6
—
1
—
—
(1)6
—
State and municipal274
16
—
—
(96)35
—
(29)—
200
8
Foreign government16
26
—
2
(13)50
—
(29)—
52
26
Corporate275
(119)—
85
(106)389
—
(271)—
253
(1)
Equity securities120
(5)—
24
(41)266
—
(194)—
170
(68)
Asset-backed securities1,590
31
—
65
(86)994
—
(1,141)—
1,453
(6)
Other trading assets615
161
—
179
(52)342
7
(509)(13)730
31
Total trading non-derivative assets3,274
223
—
543
(660)2,434
7
(2,543)(14)3,264
(9)
Trading derivatives, net(4)
           
Interest rate contracts(422)597
—
(6)(74)8
8
(16)24
119
540
Foreign exchange contracts130
89
—
(28)59
11
—
(71)(1)189
52
Equity contracts(2,027)163
—
(70)1,123
20
(15)(14)(94)(914)66
Commodity contracts(1,861)(241)—
1
82
39
—
(8)183
(1,805)(70)
Credit derivatives(799)(338)—
(15)19
2
—
1
124
(1,006)(468)
Total trading derivatives, net(4)
(4,979)270
—
(118)1,209
80
(7)(108)236
(3,417)120
Investments           
Mortgage-backed securities           
U.S. government-sponsored agency guaranteed24
—
10
—
—
—
—
—
—
34
(12)
Residential—
—
—
—
—
—
—
—
—
—
—
Commercial3
—
2
1
(1)—
—
—
—
5
—
Total investment mortgage-backed securities27
—
12
1
(1)—
—
—
—
39
(12)
U.S. Treasury and federal agency securities—
—
—
—
—
—
—
—
—
—
—
State and municipal737
—
(23)—
(18)157
—
(171)—
682
(32)
Foreign government92
—
(7)1
(4)107
—
(108)—
81
(3)
Corporate71
—
(1)3
(66)3
—
(10)—
—
—
Equity securities2
—
—
—
—
—
—
(1)(1)—
—
Asset-backed securities827
—
(21)3
(521)45
—
(49)—
284
(6)
Other debt securities—
—
—
—
—
—
—
—
—
—
—
Non-marketable equity securities681
—
(103)193
—
86
—
(73)(51)733
(56)
Total investments2,437
—
(143)201
(610)398
—
(412)(52)1,819
(109)


 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsDec. 31, 2016Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017Dec. 31, 2017Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2018
Loans$568
$—
$57
$80
$(16)$173
$—
$(312)$(6)$544
$266
550
—
(282)—
13
130
—
(25)(3)383
286
Mortgage servicing rights1,564
—
50
—
—
—
75
(1,046)(90)553
(40)558
—
82
—
—
—
46
(18)(50)618
83
Other financial assets measured on a recurring basis34
—
(147)3
(8)1
303
(8)(164)14
(68)16
—
37
—
(11)4
12
(8)(50)—
53
Liabilities      
Interest-bearing deposits$293
$—
$9
$40
$—
$—
$—
$—
$(24)$300
$6
286
—
37
12
—
—
45
—
(3)303
(104)
Federal funds purchased and securities loaned or sold under agreements to repurchase849
7
—
—
—
—
—
—
(77)765
4
Federal funds purchased and securities loaned and sold under agreements to repurchase726
8
—
—
—
—
243
—
36
997
52
Trading account liabilities      
Securities sold, not yet purchased1,177
490
—
18
(53)—
—
265
(233)684
24
22
(384)—
35
(86)14
121
(36)(67)387
(128)
Other trading liabilities—
—
—
—
—
—
—
—
—
—
—
5
5
—
—
—
—
—
—
—
—
—
Short-term borrowings42
18
—
4
(1)—
31
—
(2)56
7
18
2
—
48
(39)—
54
—
(40)39
22
Long-term debt9,744
456
—
702
(1,457)—
2,701
—
87
11,321
708
13,082
(474)—
2,200
(1,950)36
(35)(45)29
13,791
(1,709)
Other financial liabilities measured on a recurring basis8
—
—
—
—
—
3
(1)(8)2
(1)8
—
(2)1
(10)—
2
—
(3)—
(9)
(1)
Changes in fair value of available-for-sale investmentsdebt securities are recorded in AOCI, unless related to other-than-temporary impairment, while gains and losses from sales are recorded in Realized gains (losses) from sales of investments on the Consolidated Statement of Income.
(2)
Unrealized gains (losses) on MSRs are recorded in Other revenue on the Consolidated Statement of Income.
(3)Represents the amount of total gains or losses for the period, included in earnings (and AOCI for changes in fair value of available-for-sale investments)debt securities), attributable to the change in fair value relating to assets and liabilities classified as Level 3 that are still held at September 30,December 31, 2017.
(4)Total Level 3 trading derivative assets and liabilities have been netted in these tables for presentation purposes only.




 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsJun. 30, 2016Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2016Jun. 30, 2017Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017
Assets      
Federal funds sold and securities borrowed or purchased under agreements to resell$1,819
$(6)$—
$���
$—
$5
$—
$—
$(505)$1,313
$(3)
Federal funds sold and securities borrowed and purchased under agreements to resell$1,002
$(338)$—
$—
$—
$—
$—
$—
$—
$664
$(338)
Trading non-derivative assets                
Trading mortgage-backed securities      
U.S. government-sponsored agency guaranteed730
1
—
67
(387)96
—
(286)7
228
—
$204
$—
$—
$75
$(21)$174
$—
$(123)$—
$309
$—
Residential801
116
—
5
(66)18
—
(433)—
441
(58)327
24
—
41
(9)39
—
(71)—
351
12
Commercial390
2
—
1
(107)309
—
(151)—
444
6
318
10
—
22
(17)11
—
(232)—
112
5
Total trading mortgage-backed securities$1,921
$119
$—
$73
$(560)$423
$—
$(870)$7
$1,113
$(52)$849
$34
$—
$138
$(47)$224
$—
$(426)$—
$772
$17
U.S. Treasury and federal agency securities$3
$—
$—
$—
$—
$—
$—
$(2)$—
$1
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
$—
State and municipal117
18
—
118
(37)56
—
(115)—
157
(1)284
(2)—
—
—
49
—
(61)—
270
(1)
Foreign government81
(19)—
—
—
24
—
(23)—
63
1
108
(5)—
4
(114)161
—
(59)—
95
(2)
Corporate405
39
—
49
(26)414
—
(208)12
685
(31)401
105
—
16
(11)148
—
(268)—
391
103
Equity securities3,970
348
—
12
(811)102
—
(61)—
3,560
(371)240
183
—
3
(41)29
—
(178)—
236
6
Asset-backed securities2,670
47
—
38
(42)783
—
(747)—
2,749
(58)1,570
114
—
5
(6)481
—
(460)—
1,704
26
Other trading assets2,839
12
—
296
(897)966
9
(628)(17)2,580
(63)1,803
(38)—
38
(607)1,349
4
(394)(4)2,151
29
Total trading non-derivative assets$12,006
$564
$—
$586
$(2,373)$2,768
$9
$(2,654)$2
$10,908
$(575)$5,255
$391
$—
$204
$(826)$2,441
$4
$(1,846)$(4)$5,619
$178
Trading derivatives, net(4)
      
Interest rate contracts$(374)$(82)$—
$(59)$77
$5
$—
$(37)$(93)$(563)$(143)(288)196
—
4
(4)25
—
(20)(114)(201)120
Foreign exchange contracts(29)10
—
69
(13)52
—
(50)50
89
149
184
(92)—
1
(4)(6)—
(3)68
148
(92)
Equity contracts(1,071)29
—
14
123
17
—
(28)(51)(967)(189)(1,647)201
—
(52)(34)31
—
(126)(221)(1,848)(10)
Commodity contracts(2,017)(76)—
(379)74
3
—
5
91
(2,299)(285)(2,024)(248)—
(29)(10)—
—
(3)(25)(2,339)(255)
Credit derivatives(754)(651)—
32
26
(4)—
(35)367
(1,019)450
(1,339)(150)—
25
115
7
—
—
401
(941)(185)
Total trading derivatives, net(4)
$(4,245)$(770)$—
$(323)$287
$73
$—
$(145)$364
$(4,759)$(18)$(5,114)$(93)$—
$(51)$63
$57
$—
$(152)$109
$(5,181)$(422)
Investments      
Mortgage-backed securities      
U.S. government-sponsored agency guaranteed$94
$—
$(4)$3
$(10)$6
$—
$—
$—
$89
$(1)$50
$—
$12
$—
$(5)$—
$—
$—
$—
$57
$28
Residential25
—
1
49
—
1
—
(23)—
53
—
—
—
—
—
—
—
—
—
—
—
—
Commercial5
—
(1)—
(4)—
—
—
—
—
—
—
—
—
3
—
—
—
—
—
3
—
Total investment mortgage-backed securities$124
$—
$(4)$52
$(14)$7
$—
$(23)$—
$142
$(1)$50
$—
$12
$3
$(5)$—
$—
$—
$—
$60
$28
U.S. Treasury and federal agency securities$3
$—
$—
$—
$—
$—
$—
$(1)$—
$2
$—
$1
$—
$—
$—
$—
$—
$—
$(1)$—
$—
$—
State and municipal2,016
—
(54)5
(338)60
—
(33)—
1,656
40
1,285
—
(2)21
(3)16
—
(45)—
1,272
17
Foreign government141
—
(14)5
—
42
—
(29)—
145
(5)358
—
(58)—
(18)122
—
(103)—
301
(7)
Corporate460
—
42
1
(18)412
—
(8)(365)524
(1)156
—
146
10
(2)41
—
(231)—
120
—
Equity securities128
—
11
—
—
—
—
(129)—
10
—
9
—
(1)—
—
—
—
(5)—
3
—
Asset-backed securities597
—
(88)3
(25)121
—
(7)81
682
88
1,028
—
(280)2
(7)504
—
(417)—
830
(134)
Other debt securities5
—
—
10
—
1
—
(5)—
11
—
10
—
—
—
—
—
—
—
—
10
—
Non-marketable equity securities1,139
—
54
53
(23)1
—
(14)(29)1,181
(9)939
—
(61)—
—
1
—
(1)(49)829
(18)
Total investments$4,613
$—
$(53)$129
$(418)$644
$—
$(249)$(313)$4,353
$112
$3,836
$—
$(244)$36
$(35)$684
$—
$(803)$(49)$3,425
$(114)



 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsJun. 30, 2016Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2016Jun. 30, 2017Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017
Loans$1,234
$—
$89
$24
$(196)$93
$—
$(137)$(25)$1,082
$(179)$577
$—
$73
$—
$—
$131
$—
$(236)$(1)$544
$264
Mortgage servicing rights1,324
—
13
—
—
—
43
(32)(78)1,270
15
560
—
(6)—
—
—
19
—
(20)553
3
Other financial assets measured on a recurring basis111
—
31
1
(41)1
72
(4)(105)66
(69)17
—
13
—
—
1
43
(4)(56)14
17
Liabilities      
Interest-bearing deposits$433
$—
$41
$—
$(100)$—
$—
$—
$(32)$260
$42
$300
$—
$(2)$—
$—
$—
$—
$—
$(2)$300
$6
Federal funds purchased and securities loaned or sold under agreements to repurchase1,107
10
—
—
(150)—
—
11
(35)923
8
Federal funds purchased and securities loaned and sold under agreements to repurchase807
(1)—
—
—
—
—
—
(43)765
4
Trading account liabilities      
Securities sold, not yet purchased12
(30)—
21
(42)(9)—
142
5
159
(30)1,143
496
—
5
(10)—
—
88
(46)684
24
Other Trading Liabilities—
—
—
1
—
—
—
—
—
1
—
Short-term borrowings53
(9)—
1
(32)—
15
—
(14)32
2
29
(13)—
3
(1)—
12
—
—
56
7
Long-term debt9,138
(191)—
947
(1,550)—
1,719
—
(1,263)9,182
(191)11,831
1,057
—
181
(490)—
419
—
437
11,321
716
Other financial liabilities measured on a recurring basis5
—
(26)2
—
(1)—
—
—
32
(2)2
—
—
—
—
—
1
—
(1)2
(1)



 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsDec. 31, 2015Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2016Dec. 31, 2016Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017
Assets      
Federal funds sold and securities borrowed or purchased under agreements to resell$1,337
$2
$—
$—
$(28)$508
$—
$—
$(506)$1,313
$3
Federal funds sold and securities borrowed and purchased under agreements to resell$1,496
$(340)$—
$—
$(491)$—
$—
$—
$(1)$664
$—
Trading non-derivative assets      
Trading mortgage-backed securities      
U.S. government-sponsored agency guaranteed744
13
—
485
(969)857
—
(920)18
228
4
176
4
—
154
(86)438
—
(377)—
309
1
Residential1,326
104
—
134
(153)275
—
(1,239)(6)441
23
399
61
—
88
(58)105
—
(244)—
351
35
Commercial517
15
—
180
(209)661
—
(720)—
444
(23)206
7
—
66
(46)445
—
(566)—
112
(5)
Total trading mortgage-backed securities$2,587
$132
$—
$799
$(1,331)$1,793
$—
$(2,879)$12
$1,113
$4
$781
$72
$—
$308
$(190)$988
$—
$(1,187)$—
$772
$31
U.S. Treasury and federal agency securities$1
$—
$—
$2
$—
$—
$—
$(2)$—
$1
$—
$1
$—
$—
$—
$—
$—
$—
$(1)$—
$—
$—
State and municipal351
26
—
136
(253)224
—
(327)—
157
—
296
3
—
24
(48)137
—
(142)—
270
(1)
Foreign government197
(27)—
2
(17)99
—
(191)—
63
(2)40
2
—
88
(204)288
—
(119)—
95
(1)
Corporate376
323
—
129
(102)748
—
(796)7
685
58
324
320
—
132
(84)424
—
(725)—
391
167
Equity securities3,684
(187)—
279
(871)851
—
(196)—
3,560
(125)127
212
—
135
(54)38
—
(222)—
236
20
Asset-backed securities2,739
181
—
195
(237)1,969
—
(2,098)—
2,749
87
1,868
251
—
28
(87)1,185
—
(1,541)—
1,704
34
Other trading assets2,483
(104)—
1,754
(2,379)2,323
7
(1,468)(36)2,580
136
2,814
(88)—
470
(1,381)2,002
5
(1,652)(19)2,151
29
Total trading non-derivative assets$12,418
$344
$—
$3,296
$(5,190)$8,007
$7
$(7,957)$(17)$10,908
$158
$6,251
$772
$—
$1,185
$(2,048)$5,062
$5
$(5,589)$(19)$5,619
$279
Trading derivatives, net(4)
      
Interest rate contracts$(495)$(408)$—
$250
$116
$147
$(18)$(140)$(15)$(563)$84
$(663)$4
$—
$(24)$647
$90
$—
$(225)$(30)$(201)$65
Foreign exchange contracts620
(667)—
73
(73)158
—
(141)119
89
(428)413
(389)—
54
(63)32
—
(37)138
148
(134)
Equity contracts(800)137
—
78
(305)63
38
(99)(79)(967)191
(1,557)98
—
(34)(8)180
—
(263)(264)(1,848)(22)
Commodity contracts(1,861)(357)—
(428)48
359
—
(347)287
(2,299)11
(1,945)(576)—
29
39
—
—
(3)117
(2,339)(255)
Credit derivatives307
(1,803)—
(82)3
38
—
(35)553
(1,019)(1,272)(1,001)(535)—
(43)91
5
—
2
540
(941)(197)
Total trading derivatives, net(4)
$(2,229)$(3,098)$—
$(109)$(211)$765
$20
$(762)$865
$(4,759)$(1,414)$(4,753)$(1,398)$—
$(18)$706
$307
$—
$(526)$501
$(5,181)$(543)
Investments      
Mortgage-backed securities      
U.S. government-sponsored agency guaranteed$139
$—
$(29)$15
$(72)$46
$—
$(9)$(1)$89
$49
$101
$—
$15
$1
$(60)$—
$—
$—
$—
$57
$30
Residential4
—
2
49
—
26
—
(28)—
53
1
50
—
2
—
(47)—
—
(5)—
—
—
Commercial2
—
(1)6
(7)—
—
—
—
—
—
—
—
—
3
—
8
—
(8)—
3
—
Total investment mortgage-backed securities$145
$—
$(28)$70
$(79)$72
$—
$(37)$(1)$142
$50
$151
$—
$17
$4
$(107)$8
$—
$(13)$—
$60
$30
U.S. Treasury and federal agency securities$4
$—
$—
$—
$—
$—
$—
$(2)$—
$2
$—
$2
$—
$—
$—
$—
$—
$—
$(2)$—
$—
$—
State and municipal2,192
—
108
396
(1,121)300
—
(219)—
1,656
45
1,211
—
37
70
(36)92
—
(102)—
1,272
35
Foreign government260
—
5
38
—
145
—
(300)(3)145
1
186
—
(47)2
(37)455
—
(258)—
301
(5)
Corporate603
—
87
6
(63)506
—
(250)(365)524
1
311
—
11
74
(6)224
—
(494)—
120
—
Equity securities124
—
11
4
—
—
—
(129)—
10
—
9
—
(1)—
—
—
—
(5)—
3
—
Asset-backed securities596
—
(53)3
(48)325
—
(222)81
682
(35)660
—
(98)23
(20)864
—
(599)—
830
(134)
Other debt securities—
—
—
10
—
6
—
(5)—
11
—
—
—
—
—
—
21
—
(11)—
10
—
Non-marketable equity securities1,135
—
78
104
(23)19
—
(14)(118)1,181
29
1,331
—
(124)2
—
10
—
(228)(162)829
49
Total investments$5,059
$—
$208
$631
$(1,334)$1,373
$—
$(1,178)$(406)$4,353
$91
$3,861
$—
$(205)$175
$(206)$1,674
$—
$(1,712)$(162)$3,425
$(25)




 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
 Net realized/unrealized
gains (losses) incl. in		Transfers 
Unrealized
gains
(losses)
still held(3)
In millions of dollarsDec. 31, 2015Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2016Dec. 31, 2016Principal
transactions
Other(1)(2)
into
Level 3		out of
Level 3		PurchasesIssuancesSalesSettlementsSept. 30, 2017
Loans$2,166
$—
$31
$113
$(734)$663
$219
$(812)$(564)$1,082
$383
$568
$—
$57
$80
$(16)$173
$—
$(312)$(6)$544
$266
Mortgage servicing rights1,781
—
(349)—
—
—
111
(18)(255)1,270
(154)1,564
—
50
—
—
—
75
(1,046)(90)553
(40)
Other financial assets measured on a recurring basis180
—
64
41
(46)1
202
(128)(248)66
(260)34
—
(147)3
(8)1
303
(8)(164)14
(68)
Liabilities      
Interest-bearing deposits$434
$—
$76
$322
$(309)$—
$5
$—
$(116)$260
$42
$293
$—
$9
$40
$—
$—
$—
$—
$(24)$300
$6
Federal funds purchased and securities loaned or sold under agreements to repurchase1,247
(11)—
—
(150)—
—
27
(212)923
(24)
Federal funds purchased and securities loaned and sold under agreements to repurchase849
7
—
—
—
—
—
—
(77)765
4
Trading account liabilities      
Securities sold, not yet purchased199
(16)—
118
(85)(70)(41)212
(190)159
(61)1,177
490
—
18
(53)—
—
265
(233)684
24
Other Trading Liabilities—
—
—
1
—
—
—
—
—
1
—
Short-term borrowings9
(36)—
18
(36)—
56
—
(51)32
2
42
18
—
4
(1)—
31
—
(2)56
7
Long-term debt7,543
(217)—
2,168
(3,393)—
4,591
61
(2,005)9,182
(277)9,744
456
—
702
(1,457)—
2,701
—
87
11,321
708
Other financial liabilities measured on a recurring basis14
—
(33)2
(10)(7)2
—
(2)32
(7)8
—
—
—
—
—
3
(1)(8)2
(1)
(1)
Changes in fair value of available-for-sale investments are recorded in AOCI, unless related to other-than-temporary impairment, while gains and losses from sales are recorded in Realized gains (losses) from sales of investments on the Consolidated Statement of Income.
(2)
Unrealized gains (losses) on MSRs are recorded in Other revenue on the Consolidated Statement of Income.
(3)Represents the amount of total gains or losses for the period, included in earnings (and AOCI for changes in fair value of available-for-sale investments), attributable to the change in fair value relating to assets and liabilities classified as Level 3 that are still held at SeptemberJune 30, 2016.2017.
(4)Total Level 3 derivative assets and liabilities have been netted in these tables for presentation purposes only.


Level 3 Fair Value Rollforward
ThereThe following were the significant Level 3 transfers for the period December 31, 2017 to September 30, 2018:

During the three and nine months ended September 30, 2018, transfers of Long-term debt of $0.4 billion and $2.2 billion from Level 2 to Level 3, and of $0.6 billion and $2.0 billion from Level 3 to Level 2, mainly related to structured debt, reflecting changes in the significance of unobservable inputs as well as certain underlying market inputs becoming less or more observable.

The were no significant Level 3 transfers for the period from June 30, 2017 to September 30, 2017:2017.

The following were the significant Level 3 transfers for the period December 31, 2016 to September 30, 2017:

Transfers of Long-term debt of $0.7 billion from Level 2 to Level 3, and of $1.5 billion from Level 3 to Level 2, mainly related to structured debt, reflecting changes in the significance of unobservable inputs as well as certain underlying market inputs becoming less or more observable.
Transfers of Other trading assets of $0.5 billion from Level 2 to Level 3, and of $1.4 billion from Level 3 to Level 2, related to trading loans, reflecting changes in the volume of market quotations and significance of unobservable inputs as well as certain underlying market inputs becoming less or more observable.

The following were the significant Level 3 transfers for the period June 30, 2016 to September 30, 2016.

Transfers of Other trading assets of $0.3 billion from Level 2 to Level 3, and of $0.9 billion from Level 3 to Level 2, related to trading loans, reflecting changes in volume of market quotations.
Transfers of Long-term debt of $0.9 billion from Level 2 to Level 3, and of $1.6 billion from Level 3 to Level 2, mainly related to structured debt,
reflecting changes in the significance of unobservable inputs as well as certain underlying market inputs becoming less or more observable.

The following were the significant Level 3 transfers for the period from December 31, 2015 to September 30, 2016:

Transfers of Trading mortgage-backed securities of $0.8 billion from Level 2 to Level 3, and of $1.3 billion from Level 3 to Level 2, related to Agency Guaranteed MBS securities, reflecting changes in the volume of market quotations.
Transfers of Other trading assets of $1.8 billion from Level 2 to Level 3, and of $2.4 billion from Level 3 to Level 2, related to trading loans, reflecting changes in the volume of market quotations.
Transfers of Long-term debt of $2.2 billionfrom Level 2 to Level 3, and of $3.4 billion from Level 3 to Level 2, mainly related to structured debt, reflecting changes in the significance of unobservable inputs as well as certain underlying market inputs becoming less or more observable.
Transfers of State and municipalinvestments of $1.1 billion from Level 3 to Level 2, mainly related to changes in the volume of market quotations.








Valuation Techniques and Inputs for Level 3 Fair Value Measurements
The following tables present the valuation techniques covering the majority of Level 3 inventory and the most significant unobservable inputs used in Level 3 fair value measurements. Differences between this table and amounts presented in the Level 3 Fair Value Rollforward table represent individually immaterial items that have been measured using a variety of valuation techniques other than those listed.
 








As of September 30, 2017
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)
High(2)(3)
Weighted
average(4)
As of September 30, 2018
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)
High(2)(3)
Weighted
average(4)
Assets        
Federal funds sold and securities borrowed or purchased under agreements to resell$664
Model-basedIR Normal Volatility26.85 %77.79%64.45 %
Federal funds sold and securities borrowed and purchased under agreements to resell$65
Model-basedInterest rate2.27 %3.67%3.54 %
Mortgage-backed securities$480
Price-basedPrice$5.90
$102.90
$73.64$273
Price-basedPrice$37.40
$108.00
$92.56
339
Yield AnalysisYield1.55 %13.72%4.96 %137
Yield analysisYield3.13 %14.29%4.72 %
Non-mortgage debt securities$2,830
Price-basedPrice$21.03
$108.46
$88.99
$1,535
Model-basedCredit Spread35 bps
375 bps
233 bps


  
State and municipal, foreign government, corporate and other debt securities$930
Price-basedPrice$—
$108.15
$79.65
  Yield2.17 %16.04%5.92 %926
Model-basedCredit spread35 bps
446 bps
246 bps
Equity securities(5)
$156
Price-basedPrice$0.09
$1,402.80
$640.33
$124
Price-basedPrice$—
$865.86
$3.50
$80
Model-based 


46
Model-basedWAL1.73 years
1.73 years
1.73 years

 
Asset-backed securities$2,387
Price-basedPrice$36.50
$100.00
$85.34
$1,666
Price-basedPrice$3.56
$100.91
$69.41
Non-marketable equity$502
Comparable AnalysisEBITDA Multiples7.30x13.3x8.94x
283
Price-basedDiscount to price— %100.00%9.71 %
Non-marketable equities$428
Comparables analysisNet operating income multiple$7.30
$25.00
$10.49
  Price to book ratio0.05x1.12x0.85x$282
Price-basedDiscount to price— %100.00%0.62 %
Derivatives—gross(6)
      
Interest rate contracts (gross)$3,679
Model-basedIR Normal Volatility10.36 %79.60%59.26 %$4,470
Model-basedMean reversion1.00 %20.00%10.50 %
  IR normal volatility0.14 %78.79%53.37 %
  Mean Reversion1.00 %20.00%10.50 %  Inflation volatility0.20 %2.56%0.76 %
Foreign exchange contracts (gross)$906
Model-basedFX Volatility5.98 %20.23%10.45 %$749
Model-basedFX volatility3.15 %17.35%10.96 %


 IR Basis(0.99)%0.38%(0.04)%$82
Cash flowCredit spread39 bps
880 bps
379 bps
  Credit Spread0.00 bps
602 bps
168 bps
  IR-IR correlation(51.00)%40.00%33.60 %
  IR-IR Correlation(51.00)%40.00%35.65 %  IR-FX correlation40.00 %60.00%50.00 %
  IR-FX Correlation(10.09)%60.00%49.13 %  FX rate— %0.04%0.03 %
  IR basis(0.79)%9.00%0.67 %
Equity contracts (gross)$2,977
Model-basedEquity Volatility3.00 %54.00%24.61 %$1,478
Model-basedEquity volatility3.00 %83.72%28.96 %
  Forward price63.10 %159.10%97.77 %
  Forward Price69.30 %114.48%94.45 %  WAL1.73 years
1.73 years
1.73 years
Commodity and other contracts (gross)$2,939
Model-basedForward Price41.12 %405.15%141.97 %$3,049
Model-basedForward price45.19 %549.00%129.77 %
  Commodity Volatility8.99 %49.49%27.04 %  Commodity volatility7.60 %55.00%17.32 %
  Commodity Correlation(38.81)%90.59%37.73 %  Commodity Correlation(52.45)%91.37%17.71 %
Credit derivatives (gross)$2,187
Model-basedRecovery Rate12.22 %55.00%36.93 %$1,924
Model-basedCredit correlation25.00 %85.00%43.50 %
949
Price-basedCredit Correlation10.00 %85.00%42.46 %714
Price-basedUpfront points5.13 %97.98%53.49 %
  Upfront Points10.94 %99.00%68.80 %  Credit spread2 bps
1,260 bps
84 bps
  Credit Spread2 bps
1,407 bps
112 bps
  Price$31.77
$98.00
$79.28
  





  Recovery rate5.00 %65.00%48.09 %


As of September 30, 2017
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)
High(2)(3)
Weighted
average(4)
Nontrading derivatives and other financial assets and liabilities measured on a recurring basis (Gross)$16
Model-basedRedemption Rate10.70 %99.50%74.48 %
As of September 30, 2018
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)
High(2)(3)
Weighted
average(4)
Loans and leases$388
Model-basedPrice$29.16
$146.83
$137.53
$318
Model-basedCredit spread128 bps
215 bps
161 bps
66
Price-basedYield4.15 %4.15%4.15 %
150
Price-basedYield2.53 %3.09%3.02 %  
Mortgage servicing rights$465
Cash flowYield8.00 %18.96%12.59 %$531
Cash flowYield4.79 %12.00%8.31 %
88
Model-basedWAL4.06 years
7.30 years
6.02 years
87
Model-basedWAL4.11 years
8.10 years
6.92 years
Liabilities      
Interest-bearing deposits$300
Model-basedMean Reversion1.00 %20.00%10.50 %$303
Model-basedMean reversion— %20.00%7.95 %
  Forward Price99.08 %99.65%99.13 %  Forward price99.23 %106.69%101.80 %
Federal funds purchased and securities loaned or sold under agreement to repurchase$765
Model-basedInterest Rate1.11 %2.17%2.00 %
  Equity volatility7.34 %20.78%17.98 %
Federal funds purchased and securities loaned and sold under agreement to repurchase$997
Model-basedInterest rate2.27 %3.41%3.14 %
Trading account liabilities      
Securities sold, not yet purchased$612
Model-basedIR Normal Volatility26.85 %77.79%64.45 %$360
Model-basedForward price45.19 %549.00%100.21 %

 Equity volatility3.00 %83.72%22.17 %
  Equity-equity correlation(81.39)%100.00%41.02 %
  Equity-FX correlation(82.74)%54.00%(32.58)%
  Mean reversion1.00 %20.00%10.50 %
  
Short-term borrowings and long-term debt$11,377
Model-basedForward Price69.30 %193.63%105.10 %$12,944
Model-basedMean reversion1.00 %20.00%10.50 %
  Forward price65.99 %259.53%103.59 %
  Equity volatility3.00 %83.72%19.28 %
As of December 31, 2016
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)
High(2)(3)
Weighted
average(4)
As of December 31, 2017
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)

High(2)(3)
Weighted
average(4)
Assets       
 
Federal funds sold and securities borrowed or purchased under agreements to resell$1,496
Model-basedIR Log-Normal Volatility12.86 %75.50 %61.73 %
  Interest Rate(0.51)%5.76 %2.80 %
Federal funds sold and securities borrowed and purchased under agreements to resell$16
Model-basedInterest rate1.43 %2.16%2.09%
Mortgage-backed securities$509
Price-basedPrice$5.50
$113.48
$61.74
$214
Price-basedPrice$2.96
$101.00
$56.52
368
Yield analysisYield1.90 %14.54 %4.34 %184
Yield analysisYield2.52 %14.06%5.97%
State and municipal, foreign government, corporate and other debt securities$3,308
Price-basedPrice$15.00
$103.60
$89.93
$949
Model-basedPrice$—
$184.04
$91.74
914
Price-basedCredit spread35 bps
500 bps
249 bps
1,513
Cash flowCredit Spread35 bps
600 bps
230 bps


 Yield2.36 %14.25%6.03%
Equity securities(5)
$69
Model-basedPrice$0.48
$104.00
$22.19
$65
Price-basedPrice$—
$25,450.00
$2,526.62
58
Price-based 





55
Model-basedWAL2.50 years
2.50 years
2.50 years
Asset-backed securities$2,454
Price-basedPrice$4.00
$100.00
$71.51
$2,287
Price-basedPrice$4.25
$100.60
$74.57
Non-marketable equity$726
Price-basedDiscount to Price— %90.00 %13.36 %$423
Comparables analysisEBITDA multiples6.90x12.80x8.66x
565
Comparables analysisEBITDA Multiples6.80x10.10x8.62x223
Price-basedDiscount to price— %100.00%11.83%
  Price-to-Book Ratio0.32x1.03x0.87x

 Price-to-book ratio0.05x1.00x0.32x
  Price$—
$113.23
$54.40
Derivatives—gross(6)
   
 


Interest rate contracts (gross)$4,897
Model-basedIR Log-Normal Volatility1.00 %93.97 %62.72 %$3,818
Model-basedIR normal volatility9.40 %77.40%58.86%
  Mean Reversion1.00 %20.00 %10.50 %  Mean reversion1.00 %20.00%10.50%
Foreign exchange contracts (gross)$1,110
Model-basedForeign Exchange (FX) Volatility1.39 %26.85 %15.18 %$940
Model-basedForeign exchange (FX) volatility4.58 %15.02%8.16%
134
Cash flowIR Basis(0.85)%(0.49)%(0.84)%
  Credit Spread4 bps
657 bps
266 bps
  IR-IR Correlation40.00 %50.00 %41.27 %
  IR-FX Correlation16.41 %60.00 %49.52 %
Equity contracts (gross)(7)
$2,701
Model-basedEquity Volatility3.00 %97.78 %29.52 %
  Forward Price69.05 %144.61 %94.28 %
  Equity-FX Correlation(60.70)%28.20 %(26.28)%
  Equity-IR Correlation(35.00)%41.00 %(15.65)%


As of December 31, 2016
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)
High(2)(3)
Weighted
average(4)
As of December 31, 2017
Fair value(1)
 (in millions)
MethodologyInput
Low(2)(3)

High(2)(3)
Weighted
average(4)
  Yield Volatility3.55 %14.77 %9.29 %

 Interest rate(0.55)%0.28%0.04%
  IR-IR correlation(51.00)%40.00%36.56%


 IR-FX correlation(7.34)%60.00%49.04%
  Credit spread11 bps
717 bps
173 bps
Equity contracts (gross)(7)
$2,897
Model-basedEquity volatility3.00 %68.93%24.66%
  Equity-Equity Correlation(87.70)%96.50 %67.45 %

 Forward price69.74 %154.19%92.80%
Commodity contracts (gross)$2,955
Model-basedForward Price35.74 %235.35 %119.99 %$2,937
Model-basedForward price3.66 %290.59%114.16%
  Commodity Volatility2.00 %32.19 %17.07 %  Commodity volatility8.60 %66.73%25.04%
  Commodity Correlation(41.61)%90.42 %52.85 %

 Commodity correlation(37.64)%91.71%15.21%
Credit derivatives (gross)$2,786
Model-basedRecovery Rate20.00 %75.00 %39.75 %$1,797
Model-basedCredit correlation25.00 %90.00%44.64%
1,403
Price-basedCredit Correlation5.00 %90.00 %34.27 %823
Price-basedUpfront points6.03 %97.26%62.88%
  Upfront Points6.00 %99.90 %72.89 %  Credit spread3 bps
1,636 bps
173 bps
  Price$1.00
$167.00
$77.35
  Price$1.00
$100.24
$57.63
  Credit Spread3 bps
1,515 bps
256 bps
Nontrading derivatives and other financial assets and liabilities measured on a recurring basis (gross)(6)
$42
Model-basedRecovery Rate40.00 %40.00 %40.00 %$24
Model-basedRecovery rate25.00 %40.00%31.56%
  Redemption Rate3.92 %99.58 %74.69 %
 Redemption rate10.72 %99.50%74.24%
  Upfront Points16.00 %20.50 %18.78 %
 Credit spread38 bps
275 bps
127 bps
Loans$258
Price-basedPrice$31.55
$105.74
$56.46

 Upfront points61.00 %61.00%61.00%
Loans and leases$391
Model-basedEquity volatility3.00 %68.93%22.52%
221
Yield analysisYield2.75 %20.00 %11.09 %148
Price-basedCredit spread134 bps
500 bps
173 bps
79
Model-based  
 Yield3.09 %4.40%3.13%
Mortgage servicing rights$1,473
Cash flowYield4.20 %20.56 %9.32 %$471
Cash flowYield8.00 %16.38%11.47%
  WAL3.53 years
7.24 years
5.83 years
87
Model-basedWAL3.83 years
6.89 years
5.93 years
Liabilities      
Interest-bearing deposits$293
Model-basedMean Reversion1.00 %20.00 %10.50 %$286
Model-basedMean reversion1.00 %20.00%10.50%
  Forward Price98.79 %104.07 %100.19 %

 Forward price99.56 %99.95%99.72%
Federal funds purchased and securities loaned or sold under agreements to repurchase$849
Model-basedInterest Rate0.62 %2.19 %1.99 %
Federal funds purchased and securities loaned and sold under agreements to repurchase$726
Model-basedInterest rate1.43 %2.16%2.09%
Trading account liabilities      
Securities sold, not yet purchased$1,056
Model-basedIR Normal Volatility12.86 %75.50 %61.73 %$21
Price-basedPrice$1.00
$287.64
$88.19
Short-term borrowings and long-term debt$9,774
Model-basedMean Reversion1.00 %20.00 %10.50 %$13,100
Model-basedForward price69.74 %161.11%100.70%
  Commodity Correlation(41.61)%90.42 %52.85 %
  Commodity Volatility2.00 %32.19 %17.07 %
  Forward Price69.05 %235.35 %103.28 %
(1)The fair value amounts presented in these tables represent the primary valuation technique or techniques for each class of assets or liabilities.
(2)Some inputs are shown as zero due to rounding.
(3)When the low and high inputs are the same, there is either a constant input applied to all positions, or the methodology involving the input applies to only one large position.
(4)Weighted averages are calculated based on the fair values of the instruments.
(5)For equity securities, the price inputs are expressed on an absolute basis, not as a percentage of the notional amount.
(6)Both trading and nontrading account derivatives—assets and liabilities—are presented on a gross absolute value basis.
(7)Includes hybrid products.




Items Measured at Fair Value on a Nonrecurring Basis
Certain assets and liabilities are measured at fair value on a nonrecurring basis and therefore are not included in the tables above. These include assets measured at cost that have been written down to fair value during the periods as a result of an impairment. These also include non-marketable equity investments that have been measured using the measurement alternative and are either (i) written down to fair value during the periods as a result of an impairment or (ii) adjusted upward or downward to fair value as a result of a transaction observed during the periods for the identical or similar investment of the same issuer. In addition, these assets include loans held-for-sale and other real estate owned that are measured at the lower of cost or market.market value.
The following table presents the carrying amounts of all assets that were still held for which a nonrecurring fair value measurement was recorded:
In millions of dollarsFair valueLevel 2Level 3Fair valueLevel 2Level 3
September 30, 2017 
Loans held-for-sale(1)
$3,211
$1,039
$2,172
September 30, 2018  
Loans HFS(1)
$4,823
$1,870
$2,953
Other real estate owned52
9
43
85
68
17
Loans(2)
718
267
451
349
155
194
Non-marketable equity investments measured using the measurement alternative115
115
—
Total assets at fair value on a nonrecurring basis$3,981
$1,315
$2,666
$5,372
$2,208
$3,164
In millions of dollarsFair valueLevel 2Level 3Fair valueLevel 2Level 3
December 31, 2016 
Loans held-for-sale(1)
$5,802
$3,389
$2,413
December 31, 2017  
Loans HFS(1)
$5,675
$2,066
$3,609
Other real estate owned75
15
60
54
10
44
Loans(2)
1,376
586
790
630
216
414
Total assets at fair value on a nonrecurring basis$7,253
$3,990
$3,263
$6,359
$2,292
$4,067
(1)
Net of fair value amounts on the unfunded portion of loans held-for-sale,HFS recognized as Other liabilities on the Consolidated Balance Sheet.
(2)Represents impaired loans held for investment whose carrying amount is based on the fair value of the underlying collateral less costs to sell, primarily real estate.




Valuation Techniques and Inputs for Level 3 Nonrecurring Fair Value Measurements
The following tables presenttable presents the valuation techniques covering the majority of Level 3 nonrecurring fair value measurements and the most significant unobservable inputs used in those measurements:

As of September 30, 2017
Fair value(1)
 (in millions)
MethodologyInput
Low(2)
High
Weighted
average(3)
As of September 30, 2018
Fair value(1)
 (in millions)
MethodologyInput
Low(2)
High
Weighted
average(3)
Loans held-for-sale$2,114
Price-basedPrice$87.73
$100.00
$98.96
$2,533
Price-basedPrice$80.90
$100.00
$99.26
Other real estate owned$41
Price-basedAppraised Value$20,291
$4,491,044
$1,967,435
$17
Price-basedAppraised value$2,353,777
$8,394,102
$7,071,276
  Discount to price34.00%34.00%34.00%
 Discount to price13.00%13.00%13.00%
  Price$30.00
$54.49
$53.48
  Price$56.31
$56.31
$56.31
Loans(5)
$231
Recovery AnalysisRecovery Rate48.00%91.97%65.20%$123
Recovery analysisPrice$13.36
$100.00
$92.33
155
CashflowAppraised Value$70.00
$88.05
$79.61
54
Price-basedRecovery rate9.00%90.00%76.62%
50
Price-basedPrice$2.75
$100.00
$128.92
  Appraised Value$9,855,140
$55,972,000
$38,154,269
As of December 31, 2016
Fair value(1)
 (in millions)
MethodologyInput
Low(2)
High
Weighted
average(3)
As of December 31, 2017
Fair value(1)
 (in millions)
MethodologyInput
Low(2)
High
Weighted
average(3)
Loans held-for-sale$2,413
Price-basedPrice$—
$100.00
$93.08
$3,186
Price-basedPrice$77.93
$100.00
$99.26
Other real estate owned$59
Price-based
Discount to price(4)
0.34%13.00%3.10%$42
Price-based
Appraised value(4)
$20,278
$8,091,760
$4,016,665


 Price$64.65
$74.39
$66.21
  
Discount to price(5)
34.00%34.00%34.00%
Loans(5)
$431
Cash flowPrice$3.25
$105.00
$59.61


 Price$30.00
$50.36
$49.09
Loans(6)
$133
Price-basedPrice$2.80
$100.00
$62.46
197
Recovery analysisForward price$2.90
$210.00
$156.78
129
Cash flowRecovery rate50.00%100.00%63.59%
135
Price-based
Discount to price(4)
0.25%13.00%8.34%127
Recovery analysisAppraised value$—
$45,500,000
$38,785,667


 Appraised value$25.80
$26,400,000
$6,462,735

(1)The fair value amounts presented in this table represent the primary valuation technique or techniques for each class of assets or liabilities.
(2)Some inputs are shown as zero due to rounding.
(3)Weighted averages are calculated based on the fair values of the instruments.
(4)Appraised values are disclosed in whole dollars.
(5)Includes estimated costs to sell.
(5)(6)Represents impaired loans held for investment whose carrying amounts are based on the fair value of the underlying collateral, primarily real estate.estate secured loans.


Nonrecurring Fair Value Changes
The following table presents total nonrecurring fair value measurements for the period, included in earnings, attributable to the change in fair value relating to assets that were still held:
Three Months Ended September 30,Three Months Ended September 30,
In millions of dollars2017201620182017
Loans held-for-sale$10
$(17)
Loans HFS$(1)$10
Other real estate owned(4)(4)(1)(4)
Loans(1)
(66)(42)(22)(66)
Non-marketable equity investments measured using the measurement alternative

7
—
Total nonrecurring fair value gains (losses)$(60)$(63)$(17)$(60)
(1)Represents loans held for investment whose carrying amount is based on the fair value of the underlying collateral, primarily real estate.


 
Nine Months Ended September 30,Nine Months Ended September 30,
In millions of dollars2017201620182017
Loans held-for-sale$11
$(15)
Loans HFS$8
$(15)
Other real estate owned(4)(6)(2)(6)
Loans(1)
(80)(110)(51)(110)
Non-marketable equity investments measured using the measurement alternative111
—
Total nonrecurring fair value gains (losses)$(73)$(131)$66
$(131)
(1)Represents loans held for investment whose carrying amount is based on the fair value of the underlying collateral, primarily real estate.




Estimated Fair Value of Financial Instruments Not Carried at Fair Value
The following table presents the carrying value and fair value of Citigroup’s financial instruments that are not carried at fair value. The table below therefore excludes items measured at fair value on a recurring basis presented in the tables above.

September 30, 2017Estimated fair valueSeptember 30, 2018Estimated fair value
Carrying
value
Estimated
fair value
 
Carrying
value
Estimated
fair value
 
In billions of dollarsLevel 1Level 2Level 3Level 1Level 2Level 3
Assets  
Investments$58.1
$58.6
$0.3
$56.3
$2.0
$58.9
$58.0
$1.1
$54.9
$2.0
Federal funds sold and securities borrowed or purchased under agreements to resell96.3
96.3
—
90.7
5.6
Federal funds sold and securities borrowed and purchased under agreements to resell102.5
102.5
—
100.5
2.0
Loans(1)(2)
634.7
635.8
—
5.8
630.0
656.7
655.2
—
5.2
650.0
Other financial assets(2)(3)
251.2
251.7
7.2
179.2
65.3
263.9
264.4
184.6
14.7
65.1
Liabilities  
Deposits$962.5
$960.3
$—
$819.1
$141.2
$1,003.7
$1,002.8
$—
$836.7
$166.1
Federal funds purchased and securities loaned or sold under agreements to repurchase116.0
116.0
—
116.0
—
127.8
127.8
—
127.8
—
Long-term debt(4)
201.8
210.5
—
178.8
31.7
198.5
200.6
—
186.3
14.3
Other financial liabilities(5)
128.3
128.3
—
15.4
112.9
110.6
110.6
—
16.1
94.5

December 31, 2016Estimated fair valueDecember 31, 2017Estimated fair value
Carrying
value
Estimated
fair value
 
Carrying
value
Estimated
fair value
 
In billions of dollarsLevel 1Level 2Level 3Level 1Level 2Level 3
Assets  
Investments$52.1
$52.0
$0.8
$48.6
$2.6
$60.2
$60.6
$0.5
$57.5
$2.6
Federal funds sold and securities borrowed or purchased under agreements to resell103.6
103.6
—
98.5
5.1
Federal funds sold and securities borrowed and purchased under agreements to resell99.5
99.5
—
94.4
5.1
Loans(1)(2)
607.0
607.3
—
7.0
600.3
648.6
644.9
—
6.0
638.9
Other financial assets(2)(3)
215.2
215.9
8.2
153.6
54.1
242.6
243.0
166.4
14.1
62.5
Liabilities  
Deposits$928.2
$927.6
$—
$789.7
$137.9
$958.4
$955.6
$—
$816.1
$139.5
Federal funds purchased and securities loaned or sold under agreements to repurchase108.2
108.2
—
107.8
0.4
115.6
115.6
—
115.6
—
Long-term debt(4)
179.9
185.5
—
156.5
29.0
205.3
214.0
—
187.2
26.8
Other financial liabilities(5)
115.3
115.3
—
16.2
99.1
129.9
129.9
—
15.5
114.4
(1)
The carrying value of loans is net of the Allowance for loan losses of $12.4$12.3 billion for September 30, 20172018 and $12.1$12.4 billion for December 31, 2016.2017. In addition, the carrying values exclude $1.8$1.6 billion and $1.9$1.7 billion of lease finance receivables at September 30, 20172018 and December 31, 2016,2017, respectively.
(2)Includes items measured at fair value on a nonrecurring basis.
(3)
Includes cash and due from banks, deposits with banks, brokerage receivables, reinsurance recoverables and other financial instruments included in Other assets on the Consolidated Balance Sheet, for all of which the carrying value is a reasonable estimate of fair value.
(4)The carrying value includes long-term debt balances under qualifying fair value hedges.
(5)
Includes brokerage payables, separate and variable accounts, short-term borrowings (carried at cost) and other financial instruments included in Other liabilities on the Consolidated Balance Sheet, for all of which the carrying value is a reasonable estimate of fair value.

The estimated fair values of the Company’s corporate unfunded lending commitments at September 30, 20172018 and December 31, 20162017 were liabilities of $2.7 billion and $5.2$3.2 billion, respectively, substantially all of which are classified as Level 3. The Company does not estimate the fair values of
consumer unfunded lending commitments, which are generally cancellable by providing notice to the borrower.



21.   FAIR VALUE ELECTIONS
The Company may elect to report most financial instruments and certain other items at fair value on an instrument-by-instrument basis with changes in fair value reported in earnings, other than DVA (see below). The election is made upon the initial recognition of an eligible financial asset, financial liability or firm commitment or when certain specified reconsideration events occur. The fair value election
may not be revoked once an election is made. The changes in
fair value are recorded in current earnings, other than DVA, which from January 1, 2016 isare reported in AOCI. Additional discussion regarding the applicable areas in which fair value elections were made is presented in Note 20 to the Consolidated Financial Statements.
The Company has elected fair value accounting for its mortgage servicing rights. See Note 18 to the Consolidated Financial Statements for further discussions regarding the accounting and reporting of MSRs.

The following table presents the changes in fair value of those items for which the fair value option has been elected:
Changes in fair value—gains (losses)Changes in fair value—gains (losses)
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
In millions of dollars20172016201720162018201720182017
Assets      
Federal funds sold and securities borrowed or purchased under agreements to resell—selected portfolios$(17)$(54)$(108)$(7)
Federal funds sold and securities borrowed and purchased under agreements to resell$(17)$(17)$(14)$(108)
Trading account assets581
571
1,243
509
3
581
(98)1,243
Investments—
(4)(3)(25)—
—
—
(3)
Loans  
    
Certain corporate loans(1)
(61)5
(42)65
11
(61)(115)(42)
Certain consumer loans(1)
1
1
3
—
—
1
—
3
Total loans$(60)$6
$(39)$65
$11
$(60)$(115)$(39)
Other assets  
    
MSRs$(6)$13
$50
$(349)$25
$(6)$82
$50
Certain mortgage loans held-for-sale(2)(1)
34
100
115
271
9
34
21
115
Other assets—
6
—
376
Total other assets$28
$119
$165
$298
$34
$28
$103
$165
Total assets$532
$638
$1,258
$840
$31
$532
$(124)$1,258
Liabilities       
Interest-bearing deposits$(16)$(16)$(60)$(84)$(20)$(16)$18
$(60)
Federal funds purchased and securities loaned or sold under agreements to repurchase—selected portfolios97
32
183
24
Federal funds purchased and securities loaned and sold under agreements to repurchase230
97
104
183
Trading account liabilities19
4
70
101
25
19
4
70
Short-term borrowings(30)(173)(110)(207)20
(30)138
(110)
Long-term debt(198)(305)(669)(845)(270)(510)1,269
(981)
Total liabilities$(128)$(458)$(586)$(1,011)$(15)$(440)$1,533
$(898)
(1)Includes mortgage loans held by consolidated mortgage loan securitization VIEs.
(2)Includes gains (losses) associated with interest rate lock commitments for those loans that have been originated and elected under the fair value option.


Own Debt Valuation Adjustments (DVA)
Own debt valuation adjustments are recognized on Citi’s liabilities for which the fair value option has been elected using Citi’s credit spreads observed in the bond market. Effective January 1, 2016, changes in fair value of fair value option liabilities related to changes in Citigroup’s own credit spreads (DVA) are reflected as a component of AOCI; previously these amounts were recognized in Citigroup’s Revenues and Net income along with all other changes in fair value. See Note 1 to the Consolidated Financial Statements for additional information.
Among other variables, the fair value of liabilities for which the fair value option has been elected (other than non-recourse and similar liabilities) is impacted by the narrowing or widening of the Company’s credit spreads.
The estimated change in the fair value of these liabilities due to such changes in the Company’s own credit spread (or instrument-specific credit risk) was a loss of $195$377 million and $319a loss of $195 million for the three months ended September 30, 2018 and 2017, and 2016,a gain of $208 million and a loss of $422 million and a gain of $8 million for the nine months ended September 30, 20172018 and 2016,2017, respectively. Changes in fair value resulting from changes in instrument-specific credit risk were estimated by incorporating the Company’s current credit spreads observable in the bond market into the relevant valuation technique used to value each liability as described above.

The Fair Value Option for Financial Assets and Financial Liabilities

Selected Portfolios of Securities Purchased Under Agreements to Resell, Securities Borrowed, Securities Sold Under Agreements to Repurchase, Securities Loaned and Certain Non-Collateralized Short-Term Borrowings
The Company elected the fair value option for certain portfolios of fixed-incomefixed income securities purchased under agreements to resell and fixed-incomefixed income securities sold under agreements to repurchase, securities borrowed, securities loaned and certain non-collateralized short-term borrowings held primarily by broker-dealer entities in the United States, United Kingdom and Japan. In each case, the election was made because the related interest rate risk is managed on a portfolio basis, primarily with offsetting derivative instruments that are accounted for at fair value through earnings.
 
Changes in fair value for transactions in these portfolios are recorded in Principal transactions. The related interest revenue and interest expense are measured based on the contractual rates specified in the transactions and are reported as interest Interest revenue and Interest expense in the Consolidated Statement of Income.

Certain Loans and Other Credit Products
Citigroup has also elected the fair value option for certain other originated and purchased loans, including certain unfunded loan products, such as guarantees and letters of credit, executed by Citigroup’s lending and trading businesses. None of these credit products are highly leveraged financing commitments. Significant groups of transactions include loans and unfunded loan products that are expected to be either sold or securitized in the near term, or transactions where the economic risks are hedged with derivative instruments, such as purchased credit default swaps or total return swaps where the Company pays the total return on the underlying loans to a third party. Citigroup has elected the fair value option to mitigate accounting mismatches in cases where hedge accounting is complex and to achieve operational simplifications. Fair value was not elected for most lending transactions across the Company.
The following table provides information about certain credit products carried at fair value:
September 30, 2017December 31, 2016September 30, 2018December 31, 2017
In millions of dollarsTrading assetsLoansTrading assetsLoansTrading assetsLoansTrading assetsLoans
Carrying amount reported on the Consolidated Balance Sheet$8,926
$4,308
$9,824
$3,486
$8,922
$4,239
$8,851
$4,374
Aggregate unpaid principal balance in excess of fair value518
82
758
18
Aggregate unpaid principal balance in excess of (less than) fair value432
538
623
682
Balance of non-accrual loans or loans more than 90 days past due—
1
—
1
—
1
—
1
Aggregate unpaid principal balance in excess of fair value for non-accrual loans or loans more than 90 days past due—
—
—
1
—
—
—
1


In addition to the amounts reported above, $653$1,043 million and $1,828$508 million of unfunded commitments related to certain credit products selected for fair value accounting were outstanding as of September 30, 20172018 and December 31, 2016,2017, respectively.
Changes in the fair value of funded and unfunded credit products are classified in Principal transactions in the Company’sCiti’s Consolidated Statement of Income. Related interest revenue is measured based on the contractual interest rates and reported as Interest revenue on Trading account assets or loan interest depending on the balance sheet classifications of the credit products. The changes in fair value for the nine months ended September 30, 20172018 and 20162017 due to instrument-specific credit risk totaled to a loss of $13 million and a gain of $57 million and $83 million, respectively.

Certain Investments in Unallocated Precious Metals
Citigroup invests in unallocated precious metals accounts (gold, silver, platinum and palladium) as part of its commodity and foreign currency trading activities or to economically hedge certain exposures from issuing structured liabilities. Under ASC 815, the investment is bifurcated into a debt host contract and a commodity forward derivative instrument. Citigroup elects the fair value option for the debt host contract, and reports the debt host contract within Trading account assets on the Company’s Consolidated Balance Sheet. The total carrying amount of debt host contracts across unallocated precious metals accounts was approximately $0.8$0.4 billion and $0.6$0.9 billion at September 30, 20172018 and December 31, 2016,2017, respectively. The amounts are expected to fluctuate based on trading activity in future periods.
As part of its commodity and foreign currency trading activities, Citi trades unallocated precious metals investments and executes forward purchase and forward sale derivative contracts with trading counterparties. When Citi sells an unallocated precious metals investment, Citi’s receivable from its depository bank is repaid and Citi derecognizes its investment in the unallocated precious metal. The forward purchase or sale contract with the trading counterparty indexed to unallocated precious metals is accounted for as a derivative, at fair value through earnings. As of September 30, 2017,2018, there were approximately $14.4$12.0 billion and $8.8$10.6 billion of notional amounts of such forward purchase and forward sale derivative contracts outstanding, respectively.

 
Certain Investments in Private Equity and Real Estate Ventures and Certain Equity Method and Other Investments
Citigroup invests in private equity and real estate ventures for the purpose of earning investment returns and for capital appreciation. The Company has elected the fair value option for certain of these ventures, because such investments are considered similar to many private equity or hedge fund activities in Citi’s investment companies, which are reported at fair value. The fair value option brings consistency in the accounting and evaluation of these investments. All investments (debt and equity) in such private equity and real estate entities are accounted for at fair value. These investments are classified as Investments on Citigroup’s Consolidated Balance Sheet.
Changes in the fair values of these investments are classified in Other revenue in the Company’s Consolidated Statement of Income.
Citigroup also electselected the fair value option for certain non-marketable equity securities, whose risk is managed with derivative instruments that are accounted for at fair value through earnings. These securities are classified as Trading account assets on Citigroup’s Consolidated Balance Sheet. Changes in the fair value of these securities and the related derivative instruments are recorded in Principal transactions. Effective January 1, 2018, under ASU 2016-01 and ASU 2018-03, a fair value option election is no longer required to measure these non-marketable equity securities at fair value through earnings. See Note 1 to the Consolidated Financial Statements for additional details.

Certain Mortgage Loans Held-for-Sale (HFS)
Citigroup has elected the fair value option for certain purchased and originated prime fixed-rate and conforming adjustable-rate first mortgage loans HFS. These loans are intended for sale or securitization and are hedged with derivative instruments. The Company has elected the fair value option to mitigate accounting mismatches in cases where hedge accounting is complex and to achieve operational simplifications.

The following table provides information about certain mortgage loans HFS carried at fair value:
In millions of dollarsSeptember 30,
2017		December 31, 2016September 30,
2018		December 31, 2017
Carrying amount reported on the Consolidated Balance Sheet$448
$915
$480
$426
Aggregate fair value in excess of unpaid principal balance15
8
Aggregate fair value in excess of (less than) unpaid principal balance9
14
Balance of non-accrual loans or loans more than 90 days past due—
—
—
—
Aggregate unpaid principal balance in excess of fair value for non-accrual loans or loans more than 90 days past due—
—
—
—


The changes in the fair values of these mortgage loans are reported in Other revenue in the Company’s Consolidated Statement of Income. There was no net change in fair value during the nine months ended September 30, 20172018 and 20162017 due to instrument-specific credit risk. Related interest income continues to be measured based on the contractual interest rates and reported as Interest revenue in the Consolidated Statement of Income.
 
Certain Structured Liabilities
The Company has elected the fair value option for certain structured liabilities whose performance is linked to structured interest rates, inflation, currency, equity, referenced credit or commodity risks. The Company elected the fair value option because these exposures are considered to be trading-related positions and, therefore, are managed on a fair value basis. These positions will continue to be classified as debt, deposits or derivatives (Trading account liabilities) on the Company’s Consolidated Balance Sheet according to their legal form.
The following table provides information about the carrying value of structured notes, disaggregated by type of embedded derivative instrument:
In billions of dollarsSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Interest rate linked$13.1
$10.6
$16.8
$13.9
Foreign exchange linked0.3
0.2
0.4
0.3
Equity linked11.9
12.3
15.2
13.0
Commodity linked1.2
0.3
0.2
0.2
Credit linked2.3
0.9
1.4
1.9
Total$28.8
$24.3
$34.0
$29.3
Prior to 2016, the total change in the fair value of these structured liabilities was reported in Principal transactions in the Company’s Consolidated Statement of Income. Beginning in the first quarter of 2016, the portion of the changes in fair value attributable to changes in Citigroup’s own credit spreads (DVA) is reflected as a component of AOCI while all other changes in fair value will continue to be reported in Principal transactions. Changes in the fair value of these structured liabilities include accrued interest, which is also included in the change in fair value reported in Principal transactions.

 
Certain Non-Structured Liabilities
The Company has elected the fair value option for certain non-structured liabilities with fixed and floating interest rates. The Company has elected the fair value option where the interest rate risk of such liabilities may be economically hedged with derivative contracts or the proceeds are used to purchase financial assets that will also be accounted for at fair value through earnings. The elections have been made to mitigate accounting mismatches and to achieve operational simplifications. These positions are reported in Short-term borrowings and Long-term debt on the Company’s Consolidated Balance Sheet. Prior to 2016, the total change in the fair value of these non-structured liabilities was reported in Principal transactions in the Company’s Consolidated Statement of Income. Beginning in the first quarter of 2016, the portion of the changes in fair value attributable to changes in Citigroup’s own credit spreads (DVA) is reflected as a component of AOCI while all other changes in fair value will continue to be reported in Principal transactions.
Interest expense on non-structured liabilities is measured based on the contractual interest rates and reported as Interest expense in the Consolidated Statement of Income.

The following table provides information about long-term debt carried at fair value:
In millions of dollarsSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Carrying amount reported on the Consolidated Balance Sheet$30,826
$26,254
$36,772
$31,392
Aggregate unpaid principal balance in excess of (less than) fair value12
(128)1,967
(579)
The following table provides information about short-term borrowings carried at fair value:
In millions of dollarsSeptember 30, 2017December 31, 2016September 30, 2018December 31, 2017
Carrying amount reported on the Consolidated Balance Sheet$4,827
$2,700
$5,042
$4,627
Aggregate unpaid principal balance in excess of (less than) fair value21
(61)
Aggregate unpaid principal balance in excess of fair value781
74


22.   GUARANTEES AND COMMITMENTS
Citi provides a variety of guarantees and indemnifications to its customers to enhance their credit standing and enable them to complete a wide variety of business transactions. For
certain contracts meeting the definition of a guarantee, the guarantor must recognize, at inception, a liability for the fair value of the obligation undertaken in issuing the guarantee.
In addition, the guarantor must disclose the maximum potential amount of future payments that the guarantor could be required to make under the guarantee, if there were a total
default by the guaranteed parties. The determination of the maximum potential future payments is based on the notional amount of the guarantees without consideration of possible
 
recoveries under recourse provisions or from collateral held or pledged. As such, Citi believes such amounts bear no relationship to the anticipated losses, if any, on these guarantees.
For additional information regarding Citi’s guarantees and indemnifications included in the tables below, as well as its other guarantees and indemnifications excluded from the tables below, see Note 26 to the Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.
The following tables present information about Citi’s guarantees at September 30, 20172018 and December 31, 2016:2017:

Maximum potential amount of future payments Maximum potential amount of future payments 
In billions of dollars at September 30, 2017 except carrying value in millions
Expire within
1 year
Expire after
1 year
Total amount
outstanding
Carrying value
 (in millions of dollars)
In billions of dollars at September 30, 2018 except carrying value in millions
Expire within
1 year
Expire after
1 year
Total amount
outstanding
Carrying value
 (in millions of dollars)
Financial standby letters of credit$27.0
$66.2
$93.2
$166
$29.9
$65.5
$95.4
$165
Performance guarantees8.0
3.0
11.0
20
7.8
4.0
11.8
30
Derivative instruments considered to be guarantees13.8
86.7
100.5
676
21.2
84.5
105.7
307
Loans sold with recourse—
0.2
0.2
9
—
1.4
1.4
9
Securities lending indemnifications(1)
106.4
—
106.4
—
120.5
—
120.5
—
Credit card merchant processing(1)(2)
82.6
—
82.6
—
95.5
—
95.5
—
Credit card arrangements with partners0.1
1.3
1.4
205
—
1.1
1.1
162
Custody indemnifications and other—
54.6
54.6
59
—
38.6
38.6
62
Total$237.9
$212.0
$449.9
$1,135
$274.9
$195.1
$470.0
$735
Maximum potential amount of future payments Maximum potential amount of future payments 
In billions of dollars at December 31, 2016 except carrying value in millions
Expire within
1 year
Expire after
1 year
Total amount
outstanding
Carrying value
 (in millions of dollars)
In billions of dollars at December 31, 2017 except carrying value in millions
Expire within
1 year
Expire after
1 year
Total amount
outstanding
Carrying value
 (in millions of dollars)
Financial standby letters of credit$26.0
$67.1
$93.1
$141
$27.9
$65.9
$93.8
$93
Performance guarantees7.5
3.6
11.1
19
7.2
4.1
11.3
20
Derivative instruments considered to be guarantees7.2
80.0
87.2
747
11.0
84.9
95.9
423
Loans sold with recourse—
0.2
0.2
12
—
1.4
1.4
9
Securities lending indemnifications(1)
80.3
—
80.3
—
103.7
—
103.7
—
Credit card merchant processing(1)(2)
86.4
—
86.4
—
85.5
—
85.5
—
Credit card arrangements with partners—
1.5
1.5
206
0.3
1.1
1.4
205
Custody indemnifications and other—
45.4
45.4
58
—
36.0
36.0
59
Total$207.4
$197.8
$405.2
$1,183
$235.6
$193.4
$429.0
$809
(1)The carrying values of securities lending indemnifications and credit card merchant processing were not material for either period presented, as the probability of potential liabilities arising from these guarantees is minimal.
(2)At September 30, 20172018 and December 31, 2016,2017, this maximum potential exposure was estimated to be $83$96 billion and $86 billion, respectively. However, Citi believes that the maximum exposure is not representative of the actual potential loss exposure based on its historical experience. This contingent liability is unlikely to arise, as most products and services are delivered when purchased and amounts are refunded when items are returned to merchants.










 












Loans sold with recourse
Loans sold with recourse represent Citi’s obligations to
reimburse the buyers for loan losses under certain
circumstances. Recourse refers to the clause in a sales
agreement under which a seller/lender will fully reimburse
the buyer/investor for any losses resulting from the
purchased loans. This may be accomplished by the seller
taking back any loans that become delinquent.
In addition to the amounts shown in the tables above,
Citi has recorded a repurchase reserve for its potential
repurchases or make-whole liability regarding residential
mortgage representation and warranty claims related to its
whole loan sales to the U.S. government-sponsored
enterprises (GSEs) and, to a lesser extent, private investors.
The repurchase reserve was approximately $72$54 million and
$107 $66 million at September 30, 20172018 and December 31, 2016,
2017, respectively, and these amounts are included in Other
liabilities on the Consolidated Balance Sheet.

Credit card arrangements with partners
Citi, in certain of its credit card partner arrangements,
provides guarantees to the partner regarding the volume of
certain customer originations during the term of the
agreement. To the extent such origination targets are not met,
the guarantees serve to compensate the partner for certain
payments that otherwise would have been generated in
connection with such originations.

Other guarantees and indemnifications

Credit Card Protection Programs
Citi, through its credit card businesses, provides various
cardholder protection programs on several of its card
products, including programs that provide insurance
coverage for rental cars, coverage for certain losses
associated with purchased products, price protection for
certain purchases and protection for lost luggage. These
guarantees are not included in the table, since the total
outstanding amount of the guarantees and Citi’s maximum
exposure to loss cannot be quantified. The protection is
limited to certain types of purchases and losses, and it is not
possible to quantify the purchases that would qualify for
these benefits at any given time. Citi assesses the probability
and amount of its potential liability related to these programs
based on the extent and nature of its historical loss
experience. At September 30, 20172018 and December 31, 2016,2017, the actual and estimated losses incurred and the carrying value of Citi’s obligations related to these programs were
immaterial.

Value-Transfer Networks
Citi is a member of, or shareholder in, hundreds of value transfervalue-transfer networks (VTNs) (payment, clearing and settlement
systems as well as exchanges) around the world. As a
condition of membership, many of these VTNs require that
members stand ready to pay a pro rata share of the losses
incurred by the organization due to another member’s default
on its obligations. Citi’s potential obligations may be limited
to its membership interests in the VTNs, contributions to the
 
VTN’s funds, or, in limited cases, the obligation may be unlimited. The maximum exposure cannot be estimated as
this would require an assessment of future claims that have
not yet occurred. Citi believes the risk of loss is remote
given historical experience with the VTNs. Accordingly,
Citi’s participation in VTNs is not reported in the guarantees
tables above, and there are no amounts reflected on the
Consolidated Balance Sheet as of September 30, 20172018 or
December 31, 20162017 for potential obligations that could arise
from Citi’s involvement with VTN associations.

Long-Term Care Insurance Indemnification
In connection with2000, Travelers Life & Annuity (Travelers), then a subsidiary of Citi, entered into a reinsurance agreement to transfer the 2005 salerisks and rewards of certain insurance and annuity subsidiaries to MetLife Inc. (MetLife), the Company provided an indemnification for policyholder claims and other liabilities relating to a book ofits long-term care (LTC) business (for the entire termto GE Life (now Genworth Financial Inc., or Genworth), then a subsidiary of the LTC policies) that is fully reinsuredGeneral Electric Company (GE). As part of this transaction, the reinsurance obligations were provided by two regulated insurance subsidiaries of GE Life, which funded two collateral trusts with securities. Presently, as discussed below, the trusts are referred to as the Genworth Financial Inc. (Genworth). In turn,Trusts.
As part of GE’s spin-off of Genworth has offsettingin 2004, GE retained the risks and rewards associated with the 2000 Travelers reinsurance agreements with MetLife and theagreement by providing a reinsurance contract to Genworth through its Union Fidelity Life Insurance Company (UFLIC), subsidiary that covers the Travelers LTC policies. In addition, GE provided a subsidiarycapital maintenance agreement in favor of the General Electric Company. Genworth has funded two trusts with securities whose fair value (approximately $7.4 billion at September 30, 2017, compared to $7.0 billion at December 31, 2016)UFLIC that is designed to cover Genworth’s statutory liabilitiesassure that UFLIC will have the funds to pay its reinsurance obligations. As a result of these reinsurance agreements and the spin-off of Genworth, Genworth has reinsurance protection from UFLIC (supported by GE) and has reinsurance obligations in connection with the Travelers LTC policies. As noted below, the Genworth reinsurance obligations now benefit Brighthouse Financial, Inc. (Brighthouse). While neither Brighthouse nor Citi are direct beneficiaries of the capital maintenance agreement between GE and UFLIC, Brighthouse and Citi benefit indirectly from the existence of the capital maintenance agreement, which helps assure that UFLIC will continue to have funds necessary to pay its reinsurance obligations to Genworth.
In connection with Citi’s 2005 sale of Travelers to MetLife Inc. (MetLife), Citi provided an indemnification to MetLife for losses (including policyholder claims) relating to the LTC business for the LTC policies. The trusts serve as collateral for Genworth's reinsurance obligations related toentire term of the MetLifeTravelers LTC policies, which, as noted above, are reinsured by subsidiaries of Genworth. In 2017, MetLife spun off its retail insurance business to Brighthouse. As a result, the Travelers LTC policies now reside with Brighthouse. The original reinsurance agreement between Travelers (now Brighthouse) and MetLife Insurance Company USAGenworth remains in place and Brighthouse is the sole beneficiary of the trusts.Genworth Trusts. The fair value of the Genworth Trusts is approximately $7.4 billion as of September 30, 2018, compared to $7.5 billion at December 31, 2017. The Genworth Trusts are designed to provide collateral to Brighthouse in an amount equal to the statutory liabilities of Brighthouse in respect of the Travelers LTC policies. The assets in these truststhe Genworth Trusts are


evaluated and adjusted periodically to ensure that the fair value of the assets continues to cover theprovide collateral in an amount equal to these estimated statutory liabilities, related toas the LTC policies, as those statutory liabilities change over time.
If both (i) Genworth fails to perform under the original
Travelers/GE Life reinsurance agreement for any reason,
including insolvency or the failure of UFLIC to perform in a timely manner, and (ii) the assets inof the two trusts Genworth Trusts
are insufficient or unavailable, to MetLife, then Citi, through its LTC
reinsurance indemnification, must reimburse MetLifeBrighthouse for
any losses actually incurred in connection with the LTC policies. Since both events would have to occur before Citi would become responsible for any payment to MetLifeBrighthouse pursuant to its indemnification obligation, and the likelihood of such events occurring is currently not probable, there is no liability reflected inon the Consolidated Balance Sheet as of September 30, 20172018 and December 31, 20162017 related to this indemnification. Citi continues to closely monitor its potential exposure under this indemnification obligation.
In the fourth quarter of 2016, MetLife announced it was pursuing spinning off the entity involved in the long-term care reinsurance obligations as part of a broader separation of its retail and group/corporate insurance operations. Separately, Genworth announced that it had agreed to
be purchased by China Oceanwide Holdings Co., Ltd, subject to a series of conditions and regulatory approvals. Citi is monitoring these developments.



Futures and over-the-counter derivatives clearing
Citi provides clearing services on central clearing parties (CCP) for clients that need to clear exchange-traded and over-the-counter (OTC) derivativesderivative contracts with CCPs. Based on all relevant facts and circumstances, Citi has concluded that it acts as an agent for accounting purposes in its role as clearing member for these client transactions. As such, Citi does not reflect the underlying exchange-traded or OTC derivatives contracts in its Consolidated Financial Statements. See Note 19 for a discussion of Citi’s derivatives activities that are reflected in its Consolidated Financial Statements.
As a clearing member, Citi collects and remits cash and securities collateral (margin) between its clients and the
respective CCP. In certain circumstances, Citi collects a higher amount of cash (or securities) from its clients than it needs to remit to the CCPs. This excess cash is then held at depository institutions such as banks or carry brokers.
There are two types of margin: initial margin and variation margin.variation. Where Citi obtains benefits from or controls cash initial margin (e.g., retains an interest
spread), cash initial margin collected from clients and
remitted to the CCP or depository institutions is reflected within Brokerage payables (payables to customers) and Brokerage receivables (receivables from brokers, dealers and clearing organizations) or Cash and due from banks., respectively.
However, for exchange-traded and OTC-cleared derivativesderivative contracts where Citi does not obtain benefits from or control the client cash balances, the client cash initial margin collected from clients and remitted to the CCP or depository institutions is not reflected on Citi’s Consolidated Balance Sheet. These conditions are met when Citi has contractually agreed with the client that (i) Citi will pass through to the client all interest paid by the CCP or depository institutions on the cash initial margin;margin, (ii) Citi
will not utilize its right as a clearing member to transform cash margin into other assets;assets, (iii) Citi does not guarantee and is not liable to the client for the performance of the CCP or the depository institution;institution and (iv) the client cash balances are legally isolated from Citi’s bankruptcy estate. The total amount of cash initial margin collected and remitted in this manner was approximately $10.6$13.2 billion and $9.4$10.7 billion as of September 30, 20172018 and December 31, 2016,2017, respectively.
Variation margin due from clients to the respective CCP, or from the CCP to clients, reflects changes in the value of the client’s derivative contracts for each trading day. As a clearing member, Citi is exposed to the risk of nonperformancenon-performance by clients (e.g., failure of a client to post
variation margin to the CCP for negative changes in the
value of the client’s derivative contracts). In the event of
non-performance by a client, Citi would move to close out
the client’s positions. The CCP would typically utilize initial
margin posted by the client and held by the CCP, with any
remaining shortfalls required to be paid by Citi as clearing
member. Citi generally holds incremental cash or securities
margin posted by the client, which would typically be
expected to be sufficient to mitigate Citi’s credit risk in the
event the client fails to perform.
As required by ASC 860-30-25-5, securities collateral posted by clients is not recognized on Citi’s Consolidated Balance Sheet.

Carrying Value—Guarantees and Indemnifications
At September 30, 20172018 and December 31, 2016,2017, the total carrying amounts of the liabilities related to the guarantees and indemnifications included in the tables above amounted
to approximately $1.1$0.7 billion and $1.2 billion$0.8 billion. The carrying value of financial and performance guarantees is included in Other liabilities. For loans sold with recourse, the carrying value of the liability is included in Other liabilities.

Collateral
Cash collateral available to Citi to reimburse losses realized under these guarantees and indemnifications amounted to $65$51 billion and $48$46 billion at September 30, 20172018 and December 31, 2016,2017, respectively. Securities and other marketable assets held as collateral amounted to $53$82 billion and $41$70 billion at September 30, 20172018 and December 31, 2016,2017, respectively. The majority of collateral is held to reimburse losses realized under securities lending indemnifications. Additionally, letters of credit in favor of Citi held as collateral amounted to $5.4$3.9 billion and $3.7 billion at both September 30, 20172018 and December 31, 2016.2017, respectively. Other property may also be available to Citi to cover losses under certain guarantees and indemnifications; however, the value of such property has not been determined.



Performance risk
Presented in the tables below are the maximum potential amounts of future payments that are classified based upon internal and external credit ratings. The determination of the maximum potential future payments is based on the notional amount of the guarantees without consideration of possible recoveries under recourse provisions or from collateral held or pledged. As such, Citi believes such amounts bear no relationship to the anticipated losses, if any, on these guarantees.




 Maximum potential amount of future payments
In billions of dollars at September 30, 2018
Investment
grade
Non-investment
grade
Not
rated
Total
Financial standby letters of credit$68.0
$11.4
$16.0
$95.4
Performance guarantees8.6
2.2
1.0
11.8
Derivative instruments deemed to be guarantees—
—
105.7
105.7
Loans sold with recourse—
—
1.4
1.4
Securities lending indemnifications—
—
120.5
120.5
Credit card merchant processing—
—
95.5
95.5
Credit card arrangements with partners—
—
1.1
1.1
Custody indemnifications and other25.7
12.9
—
38.6
Total$102.3
$26.5
$341.2
$470.0

 Maximum potential amount of future payments
In billions of dollars at September 30, 2017
Investment
grade
Non-investment
grade
Not
rated
Total
Financial standby letters of credit$65.9
$13.2
$14.1
$93.2
Performance guarantees7.2
3.0
0.8
11.0
Derivative instruments deemed to be guarantees—
—
100.5
100.5
Loans sold with recourse—
—
0.2
0.2
Securities lending indemnifications—
—
106.4
106.4
Credit card merchant processing—
—
82.6
82.6
Credit card arrangements with partners—
—
1.4
1.4
Custody indemnifications and other54.3
0.3
—
54.6
Total$127.4
$16.5
$306.0
$449.9

Maximum potential amount of future paymentsMaximum potential amount of future payments
In billions of dollars at December 31, 2016
Investment
grade
Non-investment
grade
Not
rated
Total
In billions of dollars at December 31, 2017
Investment
grade
Non-investment
grade
Not
rated
Total
Financial standby letters of credit$66.8
$13.4
$12.9
$93.1
$68.1
$10.9
$14.8
$93.8
Performance guarantees6.3
4.0
0.8
11.1
7.9
2.4
1.0
11.3
Derivative instruments deemed to be guarantees—
—
87.2
87.2
—
—
95.9
95.9
Loans sold with recourse—
—
0.2
0.2
—
—
1.4
1.4
Securities lending indemnifications—
—
80.3
80.3
—
—
103.7
103.7
Credit card merchant processing—
—
86.4
86.4
—
—
85.5
85.5
Credit card arrangements with partners—
—
1.5
1.5
—
—
1.4
1.4
Custody indemnifications and other45.3
0.1
—
45.4
23.7
12.3
—
36.0
Total$118.4
$17.5
$269.3
$405.2
$99.7
$25.6
$303.7
$429.0




Credit Commitments and Lines of Credit
The table below summarizes Citigroup’s credit commitments:
In millions of dollarsU.S.
Outside of 
U.S.
September 30,
2017
December 31,
2016
U.S.
Outside of 
U.S.
September 30,
2018
December 31,
2017
Commercial and similar letters of credit$756
$4,297
$5,053
$5,736
$798
$4,290
$5,088
$5,000
One- to four-family residential mortgages1,352
1,831
3,183
2,838
1,199
1,709
2,908
2,674
Revolving open-end loans secured by one- to four-family residential properties11,137
1,508
12,645
13,405
10,212
1,391
11,603
12,323
Commercial real estate, construction and land development9,166
1,973
11,139
10,781
12,175
1,971
14,146
11,151
Credit card lines579,285
100,624
679,909
664,335
605,614
94,646
700,260
678,300
Commercial and other consumer loan commitments167,736
95,939
263,675
259,934
199,722
107,517
307,239
272,655
Other commitments and contingencies2,115
1,325
3,440
3,202
3,165
516
3,681
3,071
Total$771,547
$207,497
$979,044
$960,231
$832,885
$212,040
$1,044,925
$985,174

The majority of unused commitments are contingent upon customers maintaining specific credit standards.
Commercial commitments generally have floating interest rates and fixed expiration dates and may require payment of fees. Such fees (net of certain direct costs) are deferred and, upon exercise of the commitment, amortized over the life of
the loan or, if exercise is deemed remote, amortized over the commitment period.

Other commitments and contingencies
Other commitments and contingencies include all other transactions related to commitments and contingencies not reported on the lines above.

Unsettled reverse repurchase and securities lendingborrowing agreements and unsettled repurchase and securities borrowinglending agreements
In addition, in the normal course of business, Citigroup enters into reverse repurchase and securities borrowing agreements, as well as repurchase and securities lending agreements, which settle at a future date. At September 30, 2017,2018, and December 31, 2016,2017, Citigroup had $44.8$54.1 billion and $43.1$35.0 billion of unsettled reverse repurchase and securities borrowing agreements, respectively, and $23.9$43.0 billion and $14.9$19.1 billion of unsettled repurchase and securities lending agreements, respectively. For a further discussion of securities purchased under agreements to resell and securities borrowed, and securities sold under agreements to repurchase and securities loaned, including the Company’s policy for offsetting repurchase and reverse repurchase agreements, see Note 10.10 to the Consolidated Financial Statements.


Restricted Cash
Citigroup defines restricted cash (as cash subject to withdrawal restrictions) to include cash deposited with central banks that must be maintained to meet minimum regulatory requirements, and cash set aside for the benefit of customers or for other purposes such as compensating balance arrangements or debt retirement. Restricted cash includes minimum reserve requirements with the Federal
Reserve Bank and certain other central banks and cash segregated to satisfy rules regarding the protection of customer assets as required by Citigroup broker-dealers’ primary regulators, including the United States Securities and Exchange Commission (SEC), the Commodities Futures Trading Commission and the United Kingdom’s Prudential Regulation Authority.
Restricted cash is included on the Consolidated Balance Sheet within the following balance sheet lines:

In millions of dollarsSeptember 30,
2018
December 31,
2017
Cash and due from banks$3,488
$3,151
Deposits with banks24,106
27,664
Total$27,594
$30,815








23.   CONTINGENCIES

The following information supplements and amends, as applicable, the disclosures in Note 23 to the Consolidated Financial Statements of each of Citigroup’s First Quarter of 20172018 Form 10-Q and Second Quarter of 20172018 Form 10-Q and Note 27 to the Consolidated Financial Statements of Citigroup’s 20162017 Annual Report on Form 10-K. For purposes of this Note, Citigroup, its affiliates and subsidiaries and current and former officers, directors and employees, are sometimes collectively referred to as Citigroup and Related Parties.
In accordance with ASC 450, Citigroup establishes accruals for contingencies, including the litigation and regulatory matters disclosed herein, when Citigroup believes it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Once established, accruals are adjusted from time to time, as appropriate, in light of additional information. The amount of loss ultimately incurred in relation to those matters may be substantially higher or lower than the amounts accrued for those matters.
If Citigroup has not accrued for a matter because the matter does not meet the criteria for accrual (as set forth above), or Citigroup believes an exposure to loss exists in excess of the amount accrued for a particular matter, in each case assuming a material loss is reasonably possible, Citigroup discloses the matter. In addition, for such matters, Citigroup discloses an estimate of the aggregate reasonably possible loss or range of loss in excess of the amounts accrued for those matters as to which an estimate can be made. At September 30, 2017,2018, Citigroup’s estimate of the reasonably possible unaccrued loss for these matters was materially unchanged from the estimate of approximately $1.5$1.0 billion in the aggregate as of June 30, 2017.2018.
As available information changes, the matters for which Citigroup is able to estimate will change, and the estimates themselves will change. In addition, while many estimates presented in financial statements and other financial disclosures involve significant judgment and may be subject to significant uncertainty, estimates of the range of reasonably possible loss arising from litigation and regulatory proceedings are subject to particular uncertainties. For example, at the time of making an estimate, Citigroup may have only preliminary, incomplete or inaccurate information about the facts underlying the claim; its assumptions about the future rulings of the court or other tribunal on significant issues, or the behavior and incentives of adverse parties or regulators, may prove to be wrong; and the outcomes it is attempting to predict are often not amenable to the use of statistical or other quantitative analytical tools. In addition, from time to time an outcome may occur that Citigroup had not accounted for in its estimates because it had deemed such an outcome to be remote. For all these reasons, the amount of loss in excess of accruals ultimately incurred for the matters as to which an estimate has been made could be substantially higher or lower than the range of loss included in the estimate.
Subject to the foregoing, it is the opinion of Citigroup's management, based on current knowledge and after taking into account its current legal accruals, that the eventual outcome of
all matters described in this Note would not be likely to have a
material adverse effect on the consolidated financial condition of Citigroup. Nonetheless, given the substantial or indeterminate amounts sought in certain of these matters and the inherent unpredictability of such matters, an adverse outcome in certain of these matters could, from time to time, have a material adverse effect on Citigroup’s consolidated results of operations or cash flows in particular quarterly or annual periods.
For further information on ASC 450 and Citigroup's accounting and disclosure framework for contingencies, including for litigation and regulatory matters disclosed herein, see Note 27 to the Consolidated Financial Statements of Citigroup’s 20162017 Annual Report on Form 10-K.

Credit Crisis-Related Litigation and OtherDepositary Receipts Matters
Mortgage-Related LitigationRegulatory Actions: The SEC’s Division of Enforcement has been investigating depositary banks and Other Mattersbroker-dealers, including Citigroup and Related Parties, in connection with activity relating to pre-released American Depositary Receipts from 2011 to 2015. Citi has been in active discussions with the SEC about a potential resolution of the investigation.
Mortgage-Backed Securities Trustee ActionsOther Litigation: On July 28, 2017, CitibankAugust 20, 2018, plaintiffs filed an appeal witha motion for preliminary approval of a class action settlement, which the New York State Supreme Court Appellate Division, First Department, appealing the portionscourt subsequently granted. A hearing for final approval of the June 27, 2017 New York State Supreme Court decision in FIXED INCOME SHARES: SERIES M, ET AL. v. CITIBANK, N.A. denying its motion to dismiss.settlement is scheduled for December 21, 2018. Additional information concerning this action is publicly available in court filings under the docket number 653891/2015 (N.Y. Sup. Ct.15 Civ. 9185 (S.D.N.Y.) (Ramos, J.(McMahon, C.).

Lehman Brothers Bankruptcy Proceedings
On September 29, 2017, Lehman Brothers Holdings Inc. (LBHI) filed a motion for approval of a global settlement in LEHMAN BROTHERS HOLDINGS INC. ET AL. v. CITIBANK, N.A. ET AL. As part of the global settlement, Citibank will retain $350 million from LBHI’s deposit at Citibank and return to LBHI and its affiliates all of the remaining deposited funds. In addition, LBHI will withdraw its remaining objections to the bankruptcy claims filed by Citibank and its affiliates. Additional information concerning this action is publicly available in court filings under the docket numbers 12-01044 and 08-13555 (Bankr. S.D.N.Y.) (Chapman, J.).

Foreign Exchange Matters
Antitrust and Other Litigation: On August 3, 2017,6, 2018, in IN RE
FOREIGN EXCHANGE BENCHMARK RATES
ANTITRUST LITIGATION, the court granted plaintiffs’ motion for final approval of the proposed class settlements with Citigroup, Citibank, Citicorp, and Citigroup Global Markets Inc. (CGMI), and certain other defendants. Additional information concerning this action is publicly available in court filings under the docket number 13 Civ. 7789 (S.D.N.Y.) (Schofield, J.).
On June 20, 2018, in NYPL v. JPMORGAN CHASE & CO., ET AL., the court ruled that plaintiffs sufficiently alleged indenied plaintiffs’ request to expand their proposed amended complaint that they suffered antitrust injuryclass to include credit card, wire and are appropriate plaintiffs to bringATM transactions with a foreign currency exchange component. On September 6, 2018, the suit. On August 10, 2017, plaintiffs filed an amended complaint. On August 24, 2017, defendants filed a renewedcourt denied plaintiffs’ motion to dismiss or to certify the court’s ruling for interlocutory appeal.reconsideration. Additional information concerning this action is publicly available in court filings under the docket numbers 15 Civ. 2290 (N.D. Cal.) (Chhabria, J.) and 15 Civ. 9300 (S.D.N.Y.) (Schofield, J.).
On August 11, 2017, defendants filed a motion to dismiss plaintiffs’ consolidated amended complaints21, 2018, in CONTANT, ET AL. v. BANK OF AMERICA CORPORATION, ET AL., plaintiffs moved for preliminary approval of a proposed class settlement with Citigroup, Citibank, Citicorp and LAVENDER ET AL. v. BANK OF AMERICA CORPORATION ET AL. Additional information concerning these actions is publicly available in court filings under the


docket numbers 16 Civ. 7512 (S.D.N.Y.) (Schofield, J.), 17 Civ. 4392 (S.D.N.Y.) (Schofield, J.), and 17 Civ. 3139 (S.D.N.Y.) (Schofield, J.).
On August 18, 2017, in NEGRETE v. CITIBANK, N.A., the parties stipulated to voluntary dismissal of plaintiffs’ sole remaining claim that was not dismissed in the court’s February 27, 2017 order. On September 7, 2017, plaintiffs filed a notice of appeal to the United States Court of Appeals for the Second Circuit. Additional information concerning this action is publicly available in court filings under the docket numbers 15 Civ. 7250 (S.D.N.Y.) (Sweet, J.) and 17-2783 (2d Cir.).
On September 11, 2017, in ALPARI (US), LLC v. CITIGROUP INC. AND CITIBANK, N.A., plaintiff filed a notice of dismissal, dismissing its case against Citigroup and Citibank in its entirety without prejudice. The court approved the dismissal on September 12, 2017 and ordered the case closed.CGMI. Additional information concerning this action is publicly available in court filings under the docket number 17 Civ. 52693139 (S.D.N.Y.) (Schofield, J.).



Interbank Offered Rates-Related Litigation and Other Matters
Antitrust and Other Litigation:On August 31, 2017, the court granted preliminary approval to a $130 million settlement with Citigroup and Citibank and the largest plaintiffs’ classJuly 19, 2018, in IN RE LIBOR-BASED FINANCIAL INSTRUMENTS ANTITRUST LITIGATION, which consiststhe court granted preliminary approval of investorsthe settlement between a putative class of plaintiffs (lending institutions with interests in loans tied to USD LIBOR) and Citigroup and Citibank.
On August 1, 2018, the court granted final approval of the settlement between the largest plaintiffs’ class (investors who purchased over-the-counter (OTC) derivatives from USD LIBOR panel banks. banks) and Citigroup and Citibank.
On October 11, 2017, the second largest plaintiffs’September 8, 2018, a putative class made up of investorsplaintiffs (investors who tradedtransacted in Eurodollar futures andor options on exchanges,exchanges) filed a motionmotions for preliminary approval of settlementsa settlement with certain defendants, including Citigroup, Citibank, CGMI and Citibank. other settling defendants.
Additional information concerning these actions and related actions and appeals is publicly available in court filings under the docket numbers 11 MD 2262 (S.D.N.Y.) (Buchwald, J.) and 17-156916-1189 (2d Cir.).
On August 18, 2017,October 4, 2018, in FRONTPOINT ASIAN EVENT DRIVEN FUND, LTDLTD., ET AL. v. CITIBANK, N.A., ET AL., the court granted in partallowed FrontPoint Asian Event Driven Fund, Ltd.’s antitrust claim and claim for breach of the defendants’ motionimplied covenant of good faith and fair dealing based on transactions linked to dismiss.the Singapore dollar Singapore Interbank Offered Rate to proceed. The court also dismissed all claims against foreign bank defendants,Sonterra Capital Master Fund, Ltd.’s antitrust claims asserted by one of the twoand both named plaintiffs, and allplaintiffs’ RICO implied covenant, and unjust enrichment claims. The court allowed one antitrust claim to proceed against the U.S. bank defendants, including Citigroup and Citibank. Plaintiffs filed an amended complaint on September 18, 2017. On October 18, 2017, defendants filed a motion to dismiss the amended complaint.claims in their entirety. Additional information concerning this action is publicly available in court filings under the docket number 16 Civ. 5263 (S.D.N.Y.) (Hellerstein, J.).

Interchange Fee Litigation
On September 18, 2018, the plaintiffs purporting to act on behalf of the putative class primarily seeking damages (the Damages Class) moved for preliminary approval of a proposed amended settlement agreement that supersedes the original settlement agreement as of October 19, 2012 to resolve claims of the Damages Class in IN RE PAYMENT CARD INTERCHANGE FEE AND MERCHANT DISCOUNT ANTITRUST LITIGATION.  Additional information regarding this matter is publicly available under the docket number MDL 05-1720 (E.D.N.Y.) (Brodie, J.).

Sovereign SecuritiesInterest Rate Swaps Matters
Antitrust and Other Litigation: In IN RE TREASURY SECURITIES AUCTION ANTITRUST LITIGATION, pursuantOn August 7, 2018, in TRUEEX LLC v. BANK OF AMERICA CORPORATION, ET AL., plaintiff filed an amended complaint. On August 28, 2018, defendants moved to dismiss the amended complaint. Additional information concerning this action is publicly available in court filings under the docket numbers 18-CV-5361 (S.D.N.Y.) (Engelmayer, J.) and 16-MDL-2704 (S.D.N.Y.) (Engelmayer, J.).

Oceanografía court-ordered stipulation, plaintiffs will file a consolidated amended complaintFraud and Related Matters
Other Litigation: On September 28, 2018, in the action commenced by November 15, 2017.Oceanografia and its former controlling shareholder, Amado Yáñez Osuna, the court granted defendants’ motion to dismiss with prejudice as to the breach of contract claim and without prejudice as to the remaining claims for malicious prosecution, tortious interference with contract and fraud on forum non conveniens grounds.  Additional information concerning this action is publicly available in court filings under the docket number 15 MD 26731:17-cv-01434 (S.D.N.Y.) (Gardephe,(Sullivan, J.).
Sovereign Securities Matters
Antitrust and Other Litigation:On August 24, 2018, the court granted defendants’ motion to dismiss consolidated putative class action complaints related to the supranational, sub-sovereign and agency (SSA) bond market. Plaintiffs may file a second amended complaint by November 6, 2018.Additional information relating to this action is publicly available in court filings under the docket number 16 Civ. 3711 (S.D.N.Y.) (Ramos, J.).
On October 6, 2017, plaintiffsSeptember 17, 2018, in IN RE SSAMEXICAN GOVERNMENT BONDS ANTITRUST LITIGATION, filed a motion for leavedefendants moved to amend their complaint, along with a proposed seconddismiss the consolidated amended complaint. Additional information concerning this action is publicly available in court filings under the docket number 1618 Civ. 037112830 (S.D.N.Y.) (Ramos,(Oetken, J.).

Settlement Payments
Payments required in settlement agreements described above have been made or are covered by existing litigation accruals.







24.   CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

Citigroup amended its Registration Statement on Form S-3 on file with the SEC (File No. 33-192302) to add its wholly owned subsidiary, Citigroup Global Markets Holdings Inc. (CGMHI), as a co-registrant. Any securities issued by CGMHI under the Form S-3 will be fully and unconditionally guaranteed by Citigroup.
The following are the Condensed Consolidating Statements of Income and Comprehensive Income for the three and nine months ended September 30, 20172018 and 2016,2017, Condensed Consolidating Balance Sheet as of September 30, 20172018 and December 31, 20162017 and Condensed Consolidating Statement of Cash Flows for the nine months ended September 30, 20172018 and 20162017 for Citigroup Inc., the parent holding company (Citigroup parent company), CGMHI, other Citigroup subsidiaries and eliminations and total consolidating adjustments. “Other Citigroup subsidiaries and eliminations” includes all other subsidiaries of Citigroup, intercompany eliminations and income (loss) from discontinued operations. “Consolidating adjustments” includes Citigroup parent company elimination of distributed and undistributed income of subsidiaries and investment in subsidiaries.
 
These Condensed Consolidating Financial Statements have been prepared and presented in accordance with SEC Regulation S-X Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.”
These Condensed Consolidating Financial Statements schedules are presented for purposes of additional analysis, but should be considered in relation to the Consolidated Financial Statements of Citigroup taken as a whole.















Condensed Consolidating Statements of Income and Comprehensive Income
Three Months Ended September 30, 2017Three Months Ended September 30, 2018
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Revenues                  
Dividends from subsidiaries$5,360
 $—
 $—
 $(5,360) $—
$7,948
 $—
 $—
 $(7,948) $—
Interest revenue—
 1,439
 14,382
 —
 15,821
1
 2,291
 15,878
 —
 18,170
Interest revenue—intercompany1,040
 313
 (1,353) —
 —
1,281
 424
 (1,705) —
 —
Interest expense1,195
 642
 2,542
 —
 4,379
1,068
 1,405
 3,895
 —
 6,368
Interest expense—intercompany240
 581
 (821) —
 —
492
 899
 (1,391) —
 —
Net interest revenue$(395) $529
 $11,308
 $—
 $11,442
$(278) $411
 $11,669
 $—
 $11,802
Commissions and fees$—
 $1,284
 $1,647
 $—
 $2,931
$—
 $1,194
 $1,609
 $—
 $2,803
Commissions and fees—intercompany—
 13
 (13) —
 —
—
 72
 (72) —
 —
Principal transactions610
 688
 872
 —
 2,170
(100) 581
 2,085
 —
 2,566
Principal transactions—intercompany168
 (249) 81
 —
 —
(303) (10) 313
 —
 —
Other income(860) 649
 1,841
 —
 1,630
266
 325
 627
 —
 1,218
Other income—intercompany33
 (21) (12) —
 —
(46) 57
 (11) —
 —
Total non-interest revenues$(49) $2,364
 $4,416
 $—
 $6,731
$(183) $2,219
 $4,551
 $—
 $6,587
Total revenues, net of interest expense$4,916
 $2,893
 $15,724
 $(5,360) $18,173
$7,487
 $2,630
 $16,220
 $(7,948) $18,389
Provisions for credit losses and for benefits and claims$—
 $(1) $2,000
 $—
 $1,999
$—
 $3
 $1,971
 $—
 $1,974
Operating expenses
 
 
 
 
         
Compensation and benefits$(3) $1,104
 $4,203
 $—
 $5,304
$14
 $1,148
 $4,157
 $—
 $5,319
Compensation and benefits—intercompany46
 —
 (46) —
 —
19
 —
 (19) —
 —
Other operating(17) 457
 4,427
 —
 4,867
(201) 558
 4,635
 —
 4,992
Other operating—intercompany8
 517
 (525) —
 —
13
 564
 (577) —
 —
Total operating expenses$34
 $2,078
 $8,059
 $—
 $10,171
$(155) $2,270
 $8,196
 $—
 $10,311
Equity in undistributed income of subsidiaries$(1,015) $—
 $—
 $1,015
 $—
$(3,098) $—
 $—
 $3,098
 $—
Income (loss) from continuing operations before income taxes$3,867
 $816
 $5,665
 $(4,345) $6,003
$4,544
 $357
 $6,053
 $(4,850) $6,104
Provision (benefit) for income taxes(266) 324
 1,808
 —
 1,866
(78) 169
 1,380
 —
 1,471
Income (loss) from continuing operations$4,133
 $492
 $3,857
 $(4,345) $4,137
$4,622
 $188
 $4,673
 $(4,850) $4,633
Loss from discontinued operations, net of taxes—
 —
 (5) —
 (5)—
 —
 (8) —
 (8)
Net income before attribution of noncontrolling interests$4,133
 $492
 $3,852
 $(4,345) $4,132
$4,622
 $188
 $4,665
 $(4,850) $4,625
Noncontrolling interests—
 —
 (1) —
 (1)—
 —
 3
 —
 3
Net income (loss)$4,133
 $492
 $3,853
 $(4,345) $4,133
$4,622
 $188
 $4,662
 $(4,850) $4,622
Comprehensive income

 

 

 

 

         
Add: Other comprehensive income (loss)$8
 $(84) $(762) $846
 $8
$(1,151) $(196) $(458) $654
 $(1,151)
Total Citigroup comprehensive income (loss)$4,141
 $408
 $3,091
 $(3,499) $4,141
$3,471

$(8)
$4,204

$(4,196)
$3,471
Add: Other comprehensive income attributable to noncontrolling interests$—

$—

$12
 $—
 $12
$—
 $—
 $8
 $—
 $8
Add: Net income attributable to noncontrolling interests—

—

(1) —
 (1)—
 —
 3
 —
 3
Total comprehensive income (loss)$4,141
 $408
 $3,102
 $(3,499) $4,152
$3,471

$(8)
$4,215

$(4,196)
$3,482









Condensed Consolidating Statements of Income and Comprehensive Income
Three Months Ended September 30, 2016Three Months Ended September 30, 2017
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Revenues                  
Dividends from subsidiaries$4,000
 $—
 $—
 $(4,000) $—
$5,360
 $—
 $—
 $(5,360) $—
Interest revenue2
 1,158
 13,493
 —
 14,653
—
 1,442
 14,472
 —
 15,914
Interest revenue—intercompany695
 148
 (843) —
 —
1,040
 313
 (1,353) —
 —
Interest expense1,102
 345
 1,727
 —
 3,174
1,195
 643
 2,541
 —
 4,379
Interest expense—intercompany61
 401
 (462) —
 —
240
 580
 (820) —
 —
Net interest revenue$(466) $560
 $11,385
 $—
 $11,479
$(395) $532
 $11,398
 $—
 $11,535
Commissions and fees$—
 $1,062
 $1,582
 $—
 $2,644
$—
 $1,262
 $1,979
 $—
 $3,241
Commissions and fees—intercompany—
 63
 (63) —
 —
—
 13
 (13) —
 —
Principal transactions(1,103) 1,600
 1,741
 —
 2,238
610
 501
 1,137
 —
 2,248
Principal transactions—intercompany977
 (470) (507) —
 —
168
 (401) 233
 —
 —
Other income482
 51
 866
 —
 1,399
(860) 729
 1,526
 —
 1,395
Other income—intercompany(501) 51
 450
 —
 —
32
 153
 (185) —
 —
Total non-interest revenues$(145) $2,357
 $4,069
 $—
 $6,281
$(50) $2,257
 $4,677

$—
 $6,884
Total revenues, net of interest expense$3,389
 $2,917
 $15,454
 $(4,000) $17,760
$4,915
 $2,789
 $16,075
 $(5,360) $18,419
Provisions for credit losses and for benefits and claims$—
 $—
 $1,736
 $—
 $1,736
$—
 $(1) $2,000
 $—
 $1,999
Operating expenses
 
 
 
 
         
Compensation and benefits$26
 $1,150
 $4,027
 $—
 $5,203
$(3) $1,104
 $4,203
 $—
 $5,304
Compensation and benefits—intercompany8
 —
 (8) —
 —
46
 —
 (46) —
 —
Other operating(103) 444
 4,860
 —
 5,201
(18) 560
 4,571
 —
 5,113
Other operating—intercompany133
 379
 (512) —
 —
8
 310
 (318) —
 —
Total operating expenses$64
 $1,973
 $8,367
 $—
 $10,404
$33
 $1,974
 $8,410
 $—
 $10,417
Equity in undistributed income of subsidiaries$120
 $—
 $—
 $(120) $—
$(1,015) $—
 $—
 $1,015
 $—
Income (loss) from continuing operations before income
taxes
$3,445
 $944
 $5,351
 $(4,120) $5,620
$3,867
 $816
 $5,665
 $(4,345) $6,003
Provision (benefit) for income taxes(395) 345
 1,783
 —
 1,733
(266)—
324
 1,808
 —
 1,866
Income (loss) from continuing operations$3,840
 $599
 $3,568
 $(4,120) $3,887
$4,133
 $492
 $3,857
 $(4,345) $4,137
Loss from discontinued operations, net of taxes—
 —
 (30) —
 (30)—
 —
 (5) —
 (5)
Net income (loss) before attribution of noncontrolling interests$3,840
 $599
 $3,538
 $(4,120) $3,857
$4,133
 $492
 $3,852
 $(4,345) $4,132
Noncontrolling interests—
 (9) 26
 —
 17
—
 —
 (1) —
 (1)
Net income (loss)$3,840
 $608
 $3,512
 $(4,120) $3,840
$4,133
 $492
 $3,853
 $(4,345) $4,133
Comprehensive income

 

 

 

 

         
Add: Other comprehensive income (loss)$(1,078) $(133) $(1,003) $1,136
 $(1,078)$8
 $(84) $(762) $846
 $8
Total Citigroup comprehensive income (loss)$2,762

$475


$2,509
 $(2,984) $2,762
$4,141


$408


$3,091

$(3,499)
$4,141
Add: Other comprehensive income attributable to noncontrolling interests$—
 $—
—
$10
 $—
 $10
$—
 $—
—
$12
 $—
 $12
Add: Net income attributable to noncontrolling interests—
 (9)

26
 —
 17
—
 —
—
(1) —
 (1)
Total comprehensive income (loss)$2,762

$466


$2,545
 $(2,984) $2,789
$4,141


$408


$3,102

$(3,499) $4,152


Condensed Consolidating Statements of Income and Comprehensive Income

 Nine Months Ended September 30, 2017
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Revenues         
Dividends from subsidiaries$11,625
 $—
 $—
 $(11,625) $—
Interest revenue—
 3,870
 41,575
 —
 45,445
Interest revenue—intercompany2,909
 847
 (3,756) —
 —
Interest expense3,549
 1,584
 6,848
 —
 11,981
Interest expense—intercompany593
 1,660
 (2,253) —
 —
Net interest revenue$(1,233) $1,473
 $33,224
 $—
 $33,464
Commissions and fees$—
 $3,818
 $4,809
 $—
 $8,627
Commissions and fees—intercompany(1) 123
 (122) —
 —
Principal transactions1,569
 2,692
 3,493
 —
 7,754
Principal transactions—intercompany768
 (641) (127) —
 —
Other income(2,500) 810
 6,039
 —
 4,349
Other income—intercompany71
 6
 (77) —
 —
Total non-interest revenues$(93) $6,808
 $14,015
 $—
 $20,730
Total revenues, net of interest expense$10,299
 $8,281
 $47,239
 $(11,625) $54,194
Provisions for credit losses and for benefits and claims$—
 $—
 $5,378
 $—
 $5,378
Operating expenses         
Compensation and benefits$(18) $3,578
 $12,741
 $—
 $16,301
Compensation and benefits—intercompany97
 —
 (97) —
 —
Other operating(333) 1,306
 13,880
 —
 14,853
Other operating—intercompany(41) 1,487
 (1,446) —
 —
Total operating expenses$(295) $6,371
 $25,078
 $—
 $31,154
Equity in undistributed income of subsidiaries$755
 $—
 $—
 $(755) $—
Income (loss) from continuing operations before income
taxes

$11,349
 $1,910
 $16,783
 $(12,380) $17,662
Provision (benefit) for income taxes(746) 800
 5,470
 —
 5,524
Income (loss) from continuing operations$12,095
 $1,110
 $11,313
 $(12,380) $12,138
Loss from discontinued operations, net of taxes—
 —
 (2) —
 (2)
Net income (loss) before attribution of noncontrolling interests$12,095
 $1,110
 $11,311
 $(12,380) $12,136
Noncontrolling interests—
 —
 41
 —
 41
Net income (loss)$12,095
 $1,110
 $11,270
 $(12,380) $12,095
Comprehensive income         
Add: Other comprehensive income (loss)$1,986
 $(142) $(4,638) $4,780
 $1,986
Total Citigroup comprehensive income (loss)$14,081
 $968
 $6,632
 $(7,600) $14,081
Add: other comprehensive income attributable to noncontrolling interests$—
 $—
 $82
 $—
 $82
Add: Net income attributable to noncontrolling interests—
 —
 41
 —
 41
Total comprehensive income (loss)$14,081
 $968
 $6,755
 $(7,600) $14,204









Condensed Consolidating Statements of Income and Comprehensive Income
Nine Months Ended September 30, 2016Nine Months Ended September 30, 2018
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Revenues                  
Dividends from subsidiaries$9,700
 $—
 $—
 $(9,700) $—
$16,648
 $—
 $—
 $(16,648) $—
Interest revenue5
 3,555
 39,616
 —
 43,176
67
 6,344
 45,641
 —
 52,052
Interest revenue—intercompany2,235
 423
 (2,658) —
 —
3,636
 1,206
 (4,842) —
 —
Interest expense3,266
 1,110
 4,858
 —
 9,234
3,119
 3,732
 10,562
 —
 17,413
Interest expense—intercompany140
 1,246
 (1,386) —
 —
1,467
 2,567
 (4,034) —
 —
Net interest revenue$(1,166) $1,622
 $33,486
 $—
 $33,942
$(883) $1,251

$34,271
 $—

$34,639
Commissions and fees$—
 $3,141
 $4,691
 $—
 $7,832
$—
 $3,793
 $5,151
 $—
 $8,944
Commissions and fees—intercompany(19) 33
 (14) —
 —
(1) 163
 (162) —
 —
Principal transactions(1,498) 3,857
 3,535
 —
 5,894
(275) 805
 7,476
 —
 8,006
Principal transactions—intercompany1,018
 (1,513) 495
 —
 —
(1,161) 1,461
 (300) —
 —
Other income(3,197) 178
 8,214
 —
 5,195
817
 666
 2,658
 —
 4,141
Other income—intercompany3,495
 250
 (3,745) —
 —
(111) 88
 23
 —
 —
Total non-interest revenues$(201) $5,946
 $13,176
 $—
 $18,921
$(731) $6,976
 $14,846
 $—
 $21,091
Total revenues, net of interest expense$8,333
 $7,568
 $46,662
 $(9,700) $52,863
$15,034
 $8,227
 $49,117
 $(16,648) $55,730
Provisions for credit losses and for benefits and claims$—
 $—
 $5,190
 $—
 $5,190
$—
 $(21) $5,664
 $—
 $5,643
Operating expenses
 
 
 
 
         
Compensation and benefits$18
 $3,641
 $12,329
 $—
 $15,988
$149
 $3,695
 $12,734
 $—
 $16,578
Compensation and benefits—intercompany34
 —
 (34) —
 —
82
 —
 (82) —
 —
Other operating377
 1,242
 13,689
 —
 15,308
(210) 1,684
 13,896
 —
 15,370
Other operating—intercompany213
 1,008
 (1,221) —
 —
38
 1,835
 (1,873) —
 —
Total operating expenses$642
 $5,891
 $24,763
 $—
 $31,296
$59
 $7,214
 $24,675
 $—
 $31,948
Equity in undistributed income of subsidiaries$2,773
 $—
 $—
 $(2,773) $—
$(2,060) $—
 $—
 $2,060
 $—
Income (loss) from continuing operations before income taxes$10,464
 $1,677
 $16,709
 $(12,473) $16,377
$12,915
 $1,034
 $18,778
 $(14,588) $18,139
Provision (benefit) for income taxes(875) 539
 5,271
 —
 4,935
(817) 853
 4,320
 —
 4,356
Income (loss) from continuing operations$11,339
 $1,138
 $11,438
 $(12,473) $11,442
$13,732
 $181
 $14,458
 $(14,588) $13,783
Loss from discontinued operations, net of taxes—
 —
 (55) —
 (55)
Net income (loss) before attribution of noncontrolling interests$11,339
 $1,138
 $11,383
 $(12,473) $11,387
$13,732
 $181
 $14,458
 $(14,588) $13,783
Noncontrolling interests—
 (10) 58
 —
 48
—
 —
 51
 —
 51
Net income (loss)$11,339
 $1,148
 $11,325
 $(12,473) $11,339
$13,732
 $181
 $14,407
 $(14,588) $13,732
Comprehensive income

 

 

 

 

         
Add: Other comprehensive income (loss)$2,166
 $(28) $171
 $(143) $2,166
$(3,974) $(186) $1,787
 $(1,601) $(3,974)
Total Citigroup comprehensive income (loss)$13,505
 $1,120
 $11,496
 $(12,616) $13,505
$9,758
 $(5) $16,194
 $(16,189) $9,758
Add: Other comprehensive income attributable to noncontrolling interests$—
 $—
 $(13) $—
 $(13)$—
 $—
 $(35) $—
 $(35)
Add: Net income attributable to noncontrolling interests—
 (10) 58
 —
 48
—
 —
 51
 —
 51
Total comprehensive income (loss)$13,505
 $1,110
 $11,541
 $(12,616) $13,540
$9,758

$(5)
$16,210

$(16,189)
$9,774













Condensed Consolidating Statements of Income and Comprehensive Income
 Nine Months Ended September 30, 2017
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Revenues         
Dividends from subsidiaries$11,625
 $—
 $—
 $(11,625) $—
Interest revenue—
 3,873
 41,856
 —
 45,729
Interest revenue—intercompany2,909
 847
 (3,756) —
 —
Interest expense3,549
 1,578
 6,854
 —
 11,981
Interest expense—intercompany593
 1,666
 (2,259) —
 —
Net interest revenue$(1,233) $1,476
 $33,505
 $—
 $33,748
Commissions and fees$—
 $3,933
 $5,619
 $—
 $9,552
Commissions and fees—intercompany(1) 123
 (122) —
 —
Principal transactions1,569
 2,377
 4,039
 —
 7,985
Principal transactions—intercompany768
 (207) (561) —
 —
Other income(2,500) 868
 5,287
 —
 3,655
Other income—intercompany70
 156
 (226) —
 —
Total non-interest revenues$(94) $7,250
 $14,036
 $—
 $21,192
Total revenues, net of interest expense$10,298
 $8,726
 $47,541
 $(11,625) $54,940
Provisions for credit losses and for benefits and claims$—
 $—
 $5,378
 $—
 $5,378
Operating expenses         
Compensation and benefits$(18) $3,578
 $12,741
 $—
 $16,301
Compensation and benefits—intercompany97
 —
 (97) —
 —
Other operating(334) 1,605
 14,328
 —
 15,599
Other operating—intercompany(41) 1,633
 (1,592) —
 —
Total operating expenses$(296) $6,816
 $25,380
 $—
 $31,900
Equity in undistributed income of subsidiaries$755
 $—
 $—
 $(755) $—
Income (loss) from continuing operations before income taxes$11,349
 $1,910
 $16,783
 $(12,380) $17,662
Provision (benefit) for income taxes(746) 800
 5,470
 —
 5,524
Income (loss) from continuing operations$12,095
 $1,110
 $11,313
 $(12,380) $12,138
Loss from discontinued operations, net of taxes—
 —
 (2) —
 (2)
Net income (loss) before attribution of noncontrolling interests$12,095
 $1,110
 $11,311
 $(12,380) $12,136
Noncontrolling interests—
 —
 41
 —
 41
Net income (loss)$12,095
 $1,110
 $11,270
 $(12,380) $12,095
Comprehensive income         
Add: Other comprehensive income (loss)$1,986
 $(142) $(4,638) $4,780
 $1,986
Total Citigroup comprehensive income (loss)$14,081
 $968
 $6,632
 $(7,600) $14,081
Add: Other comprehensive income attributable to noncontrolling interests$—
 $—
 $82
 $—
 $82
Add: Net income attributable to noncontrolling interests—
 —
 41
 —
 41
Total comprehensive income (loss)$14,081
 $968
 $6,755
 $(7,600) $14,204



Condensed Consolidating Balance Sheet
September 30, 2017September 30, 2018
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Assets                  
Cash and due from banks$—
 $728
 $21,876
 $—
 $22,604
$1
 $543
 $25,183
 $—
 $25,727
Cash and due from banks—intercompany179
 3,791
 (3,970) —
 —
17
 2,104
 (2,121) —
 —
Deposits with banks—
 3,302
 170,257
 —
 173,559
Deposits with banks—intercompany3,000
 6,386
 (9,386) —
 —
Federal funds sold and resale agreements—
 202,366
 50,242
 —
 252,608
—
 227,147
 53,794
 —
 280,941
Federal funds sold and resale agreements—intercompany—
 14,980
 (14,980) —
 —
—
 19,572
 (19,572) —
 —
Trading account assets—
 137,196
 121,711
 —
 258,907
258
 144,440
 112,804
 —
 257,502
Trading account assets—intercompany215
 1,208
 (1,423) —
 —
963
 2,934
 (3,897) —
 —
Investments28
 162
 354,484
 —
 354,674
7
 215
 345,291
 —
 345,513
Loans, net of unearned income—
 1,364
 651,819
 —
 653,183
—
 1,518
 673,391
 —
 674,909
Loans, net of unearned income—intercompany—
 —
 —
 —
 —
—
 —
 —
 —
 —
Allowance for loan losses—
 —
 (12,366) —
 (12,366)—
 —
 (12,336) —
 (12,336)
Total loans, net$—
 $1,364
 $639,453
 $—
 $640,817
$—
 $1,518
 $661,055
 $—
 $662,573
Advances to subsidiaries$132,197
 $—
 $(132,197) $—
 $—
$146,339
 $—
 $(146,339) $—
 $—
Investments in subsidiaries229,142
 —
 —
 (229,142) —
203,896
 —
 —
 (203,896) —
Other assets (1)
24,032
 58,665
 276,826
 —
 359,523
12,517
 67,087
 99,746
 —
 179,350
Other assets—intercompany15,541
 49,032
 (64,573) —
 —
3,638
 45,654
 (49,292) —
 —
Total assets$401,334
 $469,492
 $1,247,449
 $(229,142) $1,889,133
$370,636
 $520,902
 $1,237,523
 $(203,896) $1,925,165
Liabilities and equity

 
 
 
 


 
 
 
 
Deposits$—
 $—
 $964,038
 $—
 $964,038
$—
 $—
 $1,005,176
 $—
 $1,005,176
Deposits—intercompany—
 —
 —
 —
 —
—
 —
 —
 —
 —
Federal funds purchased and securities loaned or sold—
 135,520
 25,762
 —
 161,282
Federal funds purchased and securities loaned or sold—intercompany—
 19,127
 (19,127) —
 —
Federal funds purchased and securities loaned and sold—
 154,341
 21,574
 —
 175,915
Federal funds purchased and securities loaned and sold—intercompany—
 34,948
 (34,948) —
 —
Trading account liabilities—
 91,058
 47,762
 —
 138,820
16
 94,163
 53,473
 —
 147,652
Trading account liabilities—intercompany18
 1,071
 (1,089) —
 —
448
 3,143
 (3,591) —
 —
Short-term borrowings246
 3,221
 34,682
 —
 38,149
254
 4,358
 29,158
 —
 33,770
Short-term borrowings—intercompany—
 63,197
 (63,197) —
 —
—
 18,100
 (18,100) —
 —
Long-term debt151,914
 17,758
 63,001
 —
 232,673
148,183
 24,324
 62,763
 —
 235,270
Long-term debt—intercompany—
 30,609
 (30,609) —
 —
—
 65,811
 (65,811) —
 —
Advances from subsidiaries17,947
 —
 (17,947) —
 —
21,965
 —
 (21,965) —
 —
Other liabilities2,790
 62,950
 59,809
 —
 125,549
2,440
 73,178
 53,901
 —
 129,519
Other liabilities—intercompany785
 11,281
 (12,066) —
 —
326
 16,369
 (16,695) —
 —
Stockholders’ equity227,634
 33,700
 196,430
 (229,142) 228,622
197,004
 32,167
 172,588
 (203,896) 197,863
Total liabilities and equity$401,334
 $469,492
 $1,247,449
 $(229,142) $1,889,133
$370,636
 $520,902
 $1,237,523
 $(203,896) $1,925,165

(1)
Other assets for Citigroup parent company at September 30, 20172018 included $17.8$30.9 billion of placements to Citibank and its branches, of which $16.0$18.1 billion had a remaining term of less than 30 days.





Condensed Consolidating Balance Sheet
December 31, 2016December 31, 2017
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Assets                  
Cash and due from banks$—
 $870
 $22,173
 $—
 $23,043
$—
 $378
 $23,397
 $—
 $23,775
Cash and due from banks—intercompany142
 3,820
 (3,962) —
 —
13
 3,750
 (3,763) —
 —
Deposits with banks—
 3,348
 153,393
 —
 156,741
Deposits with banks—intercompany11,000
 5,219
 (16,219) —
 —
Federal funds sold and resale agreements—
 196,236
 40,577
 —
 236,813
—
 182,685
 49,793
 —
 232,478
Federal funds sold and resale agreements—intercompany—
 12,270
 (12,270) —
 —
—
 16,091
 (16,091) —
 —
Trading account assets6
 121,484
 122,435
 —
 243,925
—
 139,462
 113,328
 —
 252,790
Trading account assets—intercompany1,173
 907
 (2,080) —
 —
38
 2,711
 (2,749) —
 —
Investments173
 335
 352,796
 —
 353,304
27
 181
 352,082
 —
 352,290
Loans, net of unearned income—
 575
 623,794
 —
 624,369
—
 900
 666,134
 —
 667,034
Loans, net of unearned income—intercompany—
 —
 —
 —
 —
—
 —
 —
 —
 —
Allowance for loan losses—
 —
 (12,060) —
 (12,060)—
 —
 (12,355) —
 (12,355)
Total loans, net$—
 $575
 $611,734
 $—
 $612,309
$—
 $900
 $653,779
 $—
 $654,679
Advances to subsidiaries$143,154
 $—
 $(143,154) $—
 $—
$139,722
 $—
 $(139,722) $—
 $—
Investments in subsidiaries226,279
 —
 —
 (226,279) —
210,537
 —
 —
 (210,537) —
Other assets(1)
23,734
 46,095
 252,854
 —
 322,683
10,844
 58,299
 100,569
 —
 169,712
Other assets—intercompany27,845
 38,207
 (66,052) —
 —
3,428
 43,613
 (47,041) —
 —
Total assets$422,506
 $420,799
 $1,175,051
 $(226,279) $1,792,077
$375,609
 $456,637
 $1,220,756
 $(210,537) $1,842,465
Liabilities and equity
 
 
 
 


 
 
 
 

Deposits$—
 $—
 $929,406
 $—
 $929,406
$—
 $—
 $959,822
 $—
 $959,822
Deposits—intercompany—
 —
 —
 —
 —
—
 —
 —
 —
 —
Federal funds purchased and securities loaned or sold—
 122,320
 19,501
 —
 141,821
Federal funds purchased and securities loaned or sold—intercompany—
 25,417
 (25,417) —
 —
Federal funds purchased and securities loaned and sold—
 134,888
 21,389
 —
 156,277
Federal funds purchased and securities loaned and sold—intercompany—
 18,597
 (18,597) —
 —
Trading account liabilities—
 87,714
 51,331
 —
 139,045
—
 80,801
 44,369
 —
 125,170
Trading account liabilities—intercompany1,006
 868
 (1,874) —
 —
15
 2,182
 (2,197) —
 —
Short-term borrowings—
 1,356
 29,345
 —
 30,701
251
 3,568
 40,633
 —
 44,452
Short-term borrowings—intercompany—
 35,596
 (35,596) —
 —
—
 32,871
 (32,871) —
 —
Long-term debt147,333
 8,128
 50,717
 —
 206,178
152,163
 18,048
 66,498
 —
 236,709
Long-term debt—intercompany—
 41,287
 (41,287) —
 —
—
 60,765
 (60,765) —
 —
Advances from subsidiaries41,258
 —
 (41,258) —
 —
19,136
 —
 (19,136) —
 —
Other liabilities3,466
 57,430
 57,887
 —
 118,783
2,673
 62,113
 53,577
 —
 118,363
Other liabilities—intercompany4,323
 7,894
 (12,217) —
 —
631
 9,753
 (10,384) —
 —
Stockholders’ equity225,120
 32,789
 194,513
 (226,279) 226,143
200,740
 33,051
 178,418
 (210,537) 201,672
Total liabilities and equity$422,506
 $420,799
 $1,175,051
 $(226,279) $1,792,077
$375,609
 $456,637
 $1,220,756
 $(210,537) $1,842,465

(1)
Other assets for Citigroup parent company at December 31, 20162017 included $20.7$29.7 billion of placements to Citibank and its branches, of which $6.8$18.9 billion had a remaining term of less than 30 days.




Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2017Nine Months Ended September 30, 2018
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Net cash provided by (used in) operating activities of continuing operations$15,381
 $(15,237) $(3,449) $—
 $(3,305)
Net cash provided by operating activities of continuing operations$12,581
 $16,232
 $1,253
 $—
 $30,066
Cash flows from investing activities of continuing operations                  
Purchases of investments$—
 $—
 $(151,362) $—
 $(151,362)$(7,955) $(18) $(121,081) $—
 $(129,054)
Proceeds from sales of investments132
 —
 89,592
 —
 89,724
7,634
 3
 44,533
 —
 52,170
Proceeds from maturities of investments—
 —
 67,166
 —
 67,166
—
 —
 82,940
 —
 82,940
Change in deposits with banks—
 10,972
 (37,026) —
 (26,054)
Change in loans—
 —
 (41,569) —
 (41,569)—
 —
 (16,131) —
 (16,131)
Proceeds from sales and securitizations of loans—
 —
 7,019
 —
 7,019
—
 —
 4,021
 —
 4,021
Proceeds from significant disposals—
 —
 3,411
 —
 3,411
—
 —
 314
 —
 314
Change in federal funds sold and resales—
 (8,840) (6,955) —
 (15,795)—
 (47,943) (519) —
 (48,462)
Changes in investments and advances—intercompany13,269
 (5,439) (7,830) —
 —
(7,769) (2,338) 10,107
 —
 —
Other investing activities—
 —
 (2,210) —
 (2,210)214
 (41) (2,534) —
 (2,361)
Net cash provided by (used in) investing activities of continuing operations$13,401
 $(3,307) $(79,764) $—
 $(69,670)$(7,876) $(50,337) $1,650
 $—
 $(56,563)
Cash flows from financing activities of continuing operations                  
Dividends paid$(2,639) $—
 $—
 $—
 $(2,639)$(3,616) $—
 $—
 $—
 $(3,616)
Redemption of preferred stock(218) —
 —
 —
 (218)
Treasury stock acquired(9,071) —
 —
 —
 (9,071)(9,848) —
 —
 —
 (9,848)
Proceeds (repayments) from issuance of long-term debt, net6,665
 4,385
 11,458
 —
 22,508
(883) 7,538
 (829) —
 5,826
Proceeds (repayments) from issuance of long-term debt—intercompany, net—
 (1,300) 1,300
 —
 —
—
 5,048
 (5,048) —
 —
Change in deposits—
 —
 34,632
 —
 34,632
—
 —
 45,354
 —
 45,354
Change in federal funds purchased and repos—
 6,910
 12,551
 —
 19,461
—
 35,804
 (16,166) —
 19,638
Change in short-term borrowings44
 1,865
 5,539
 —
 7,448
32
 790
 (11,503) —
 (10,681)
Net change in short-term borrowings and other advances—intercompany(23,342) 6,573
 16,769
 —
 —
2,312
 (14,771) 12,459
 —
 —
Capital contributions from parent—
 (60) 60
 —
 —
Capital contributions from (to) parent—
 (663) 663
 —
 —
Other financing activities(402) —
 —
 —
 (402)(479) —
 —
 —
 (479)
Net cash provided by (used in) financing activities of continuing operations$(28,745) $18,373
 $82,309
 $—
 $71,937
$(12,700) $33,746
 $24,930
 $—
 $45,976
Effect of exchange rate changes on cash and due from banks$—
 $—
 $599
 $—
 $599
$—
 $—
 $(709) $—
 $(709)
Change in cash and due from banks$37
 $(171) $(305) $—
 $(439)
Cash and due from banks at beginning of period142
 4,690
 18,211
 —
 23,043
Cash and due from banks at end of period$179
 $4,519
 $17,906
 $—
 $22,604
Change in cash and due from banks and deposits with banks

$(7,995)
$(359)
$27,124

$—
 $18,770
Cash and due from banks and deposits with banks at beginning of period11,013
 12,695
 156,808
 —
 180,516
Cash and due from banks and deposits with banks at end of period$3,018
 $12,336
 $183,932
 $—
 $199,286
Cash and due from banks$18
 $2,648
 $23,061
 $—
 $25,727
Deposits with banks3,000
 9,688
 160,871
 —
 173,559
Cash and due from banks and deposits with banks at end of period$3,018
 $12,336
 $183,932
 $—
 $199,286
Supplemental disclosure of cash flow information for continuing operations

 

 

 

 

         
Cash paid (received) during the year for income taxes$(772) $470
 $3,016
 $—
 $2,714
Cash paid during the year for income taxes$873
 $138
 $2,250
 $—
 $3,261
Cash paid during the year for interest3,319
 3,175
 5,110
 —
 11,604
2,870
 6,045
 7,363
 —
 16,278
Non-cash investing activities

 

 

 

 

         
Transfers to loans HFS from loans$—
 $—
 $3,800
 $—
 $3,800
$—
 $—
 $3,300
 $—
 $3,300
Transfers to OREO and other repossessed assets—
 —
 85
 —
 85
—
 —
 94
 —
 94


Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2016Nine Months Ended September 30, 2017
In millions of dollarsCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidatedCitigroup parent company CGMHI Other Citigroup subsidiaries and eliminations Consolidating adjustments Citigroup consolidated
Net cash provided by (used in) operating activities of continuing operations$16,685
 $5,285
 $6,364
 $—
 $28,334
$5,712
 $(15,236) $6,063
 $—
 $(3,461)
Cash flows from investing activities of continuing operations                 

Purchases of investments$—
 $—
 $(155,804) $—
 $(155,804)$—
 $—
 $(151,362) $—
 $(151,362)
Proceeds from sales of investments229
 —
 98,943
 —
 99,172
132
 —
 89,592
 —
 89,724
Proceeds from maturities of investments61
 —
 52,546
 —
 52,607
—
 —
 67,166
 —
 67,166
Change in deposits with banks—
 (1,464) (18,910) —
 (20,374)
Change in loans—
 —
 (42,163) —
 (42,163)—
 —
 (41,569) —
 (41,569)
Proceeds from sales and securitizations of loans—
 —
 12,676
 —
 12,676
—
 —
 7,019
 —
 7,019
Proceeds from significant disposals—
 —
 265
 —
 265
—
 —
 3,411
 —
 3,411
Change in federal funds sold and resales—
 (12,398) (3,972) —
 (16,370)—
 (8,840) (6,955) —
 (15,795)
Changes in investments and advances—intercompany(14,378) (23) 14,401
 —
 —
13,269
 (5,439) (7,830) —
 —
Other investing activities2,962
 —
 (4,587) —
 (1,625)—
 —
 (2,054) —
 (2,054)
Net cash used in investing activities of continuing operations$(11,126) $(13,885) $(46,605) $—
 $(71,616)
Net cash provided by (used in) investing activities of continuing operations$13,401
 $(14,279) $(42,582) $—
 $(43,460)
Cash flows from financing activities of continuing operations                  
Dividends paid$(1,517) $—
 $—
 $—
 $(1,517)$(2,639) $—
 $—
 $—
 $(2,639)
Issuance of preferred stock2,498
 —
 —
 —
 2,498
Treasury stock acquired(5,167) —
 —
 —
 (5,167)(9,071) —
 —
 —
 (9,071)
Proceeds (repayments) from issuance of long-term debt, net1,613
 4,196
 (2,806) —
 3,003
Proceeds from issuance of long-term debt, net6,665
 4,385
 11,458
 —
 22,508
Proceeds (repayments) from issuance of long-term debt—intercompany, net—
 (12,533) 12,533
 —
 —
—
 (1,300) 1,300
 —
 —
Change in deposits—
 —
 32,365
 —
 32,365
—
 —
 34,632
 —
 34,632
Change in federal funds purchased and repos—
 12,251
 (5,623) —
 6,628
—
 6,910
 12,551
 —
 19,461
Change in short-term borrowings(163) 1,251
 7,360
 —
 8,448
44
 1,865
 5,539
 —
 7,448
Net change in short-term borrowings and other advances—intercompany(2,503) (726) 3,229
 —
 —
(23,342) 6,573
 16,769
 —
 —
Capital contributions from parent—
 5,000
 (5,000) —
 —
—
 (60) 60
 —
 —
Other financing activities(313) —
 —
 —
 (313)(402) —
 —
 —
 (402)
Net cash provided by (used in) financing activities of continuing operations$(5,552) $9,439
 $42,058
 $—
 $45,945
$(28,745) $18,373
 $82,309
 $—
 $71,937
Effect of exchange rate changes on cash and due from banks$—
 $—
 $(144) $—
 $(144)$—
 $—
 $599
 $—
 $599
Change in cash and due from banks$7
 $839
 $1,673
 $—
 $2,519
Cash and due from banks at beginning of period124
 1,995
 18,781
 —
 20,900
Cash and due from banks at end of period$131
 $2,834
 $20,454
 $—
 $23,419
Change in cash and due from banks and deposits with banks

$(9,632) $(11,142) $46,389
 $—
 $25,615
Cash and due from banks and deposits with banks at beginning of period20,811
 25,118
 114,565
 —
 160,494
Cash and due from banks and deposits with banks at end of period$11,179
 $13,976
 $160,954
 $—
 $186,109
Cash and due from banks$179
 $4,519
 $17,906
 $—
 $22,604
Deposits with banks11,000
 9,457
 143,048
 —
 163,505
Cash and due from banks and deposits with banks at end of period$11,179
 $13,976
 $160,954
 $—
 $186,109
Supplemental disclosure of cash flow information for continuing operations

 

 

 

 

         
Cash paid (refund) during the year for income taxes$(265) $81
 $3,039
 $—
 $2,855
Cash paid (received) during the year for income taxes$(772) $470
 $3,016
 $—
 $2,714
Cash paid during the year for interest3,402
 2,378
 3,980
 —
 9,760
3,319
 3,175
 5,110
 —
 11,604
Non-cash investing activities

 

 

 

 

         
Transfers to loans HFS from loans$—
 $—
 $8,600
 $—
 $8,600
$—
 $—
 $3,800
 $—
 $3,800
Transfers to OREO and other repossessed assets—
 —
 138
 —
 138
—
 —
 85
 —
 85


UNREGISTERED SALES OF EQUITY SECURITIES, PURCHASES OF EQUITY SECURITIES AND DIVIDENDS

Unregistered Sales of Equity Securities
None.

Equity Security Repurchases
The following table summarizes Citi’s equity security repurchases, which consisted entirely of common stock repurchases:

In millions, except per share amounts
Total shares
purchased
Average
price paid
per share
Approximate dollar
value of shares that
may yet be purchased
under the plan or
programs
Total shares
purchased
Average
price paid
per share
Approximate dollar
value of shares that
may yet be purchased
under the plan or
programs
July 2017  
July 2018  
Open market repurchases(1)
25.5
$67.33
$13,884
21.0
$69.06
$16,146
Employee transactions(2)
—
—
N/A
—
—
N/A
August 2017  
August 2018  
Open market repurchases(1)
31.0
67.84
11,782
30.0
71.05
14,018
Employee transactions(2)
—
—
N/A
—
—
N/A
September 2017  
September 2018  
Open market repurchases(1)
24.1
69.26
10,110
23.6
71.62
12,330
Employee transactions(2)
—
—
N/A
—
—
N/A
Total for 3Q17 and remaining program balance as of September 30, 201780.6
$68.10
$10,110
Total for 3Q18 and remaining program balance as of September 30, 201874.6
$70.67
$12,330
(1)Represents repurchases under the $15.6$17.6 billion 20172018 common stock repurchase program (2017(2018 Repurchase Program) that was approved by Citigroup’s Board of Directors and announced on June 28, 2017.2018. The 20172018 Repurchase Program was part of the planned capital actions included by Citi in its 20172018 Comprehensive Capital Analysis and Review (CCAR). The 2018 Repurchase Program expires on June 30, 2019. Shares repurchased under the 20172018 Repurchase Program were added to treasury stock.
(2)Consisted of shares added to treasury stock related to (i) certain activity on employee stock option program exercises where the employee delivers existing shares to cover the option exercise, or (ii) under Citi’s employee restricted or deferred stock programsshare awards where shares are withheld to satisfy tax requirements.
N/A Not applicable

Dividends
In addition to Board of Directors’ approval, Citi’s ability to pay common stock dividends substantially depends on regulatory approval, including an annual regulatory review of the results of the CCAR process required by the Federal Reserve Board and the supervisory stress tests required under the Dodd-Frank Act. For additional information regarding Citi’s capital planning and stress testing, see “Capital Resources—Current Regulatory Capital Standards—Standards” and “Regulatory Capital Planning and Stress Testing”Standards Developments” above and “Risk Factors—Strategic Risks” and “Stress Testing Component on Capital Planning” in Citi’s 20162017 Annual Report on Form 10-K. Any dividend on Citi’s outstanding common stock would also need to be made in compliance with Citi’s obligations to its outstanding preferred stock.
For information on the ability of Citigroup’s subsidiary depository institutions to pay dividends, see Note 18 to the
Consolidated Financial Statements in Citi’s 20162017 Annual Report on Form 10-K.





SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on the 31st30th day of October, 2017.2018.



CITIGROUP INC.
(Registrant)





By    /s/ John C. Gerspach
John C. Gerspach
Chief Financial Officer
(Principal Financial Officer)



By    /s/ Jeffrey R. WalshRaja J. Akram
Jeffrey R. WalshRaja J. Akram
Controller and Chief Accounting Officer
(Principal Accounting Officer)




EXHIBIT INDEX
 
Exhibit  
Number Description of Exhibit
3.01
 
Restated Certificate of Incorporation of the Company, as in effect on the date hereof, incorporated by reference to Exhibit 3.01 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016June 30, 2018 (File No. 1-9924).
12.01+
Calculation of Ratio of Income to Fixed Charges.
12.02+
Calculation of Ratio of Income to Fixed Charges Including Preferred Stock Dividends.
   
31.01+
 
Certification of principal executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
   
31.02+
 
Certification of principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
   
32.01+
 
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
   
101.01+
 
Financial statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2017,2018, filed on October 31, 2017,30, 2018, formatted in XBRL: (i) the Consolidated Statement of Income, (ii) the Consolidated Balance Sheet, (iii) the Consolidated Statement of Changes in Equity, (iv) the Consolidated Statement of Cash Flows and (v) the Notes to Consolidated Financial Statements.
 
The total amount of securities authorized pursuant to any instrument defining rights of holders of long-term debt of the Company does not exceed 10% of the total assets of the Company and its consolidated subsidiaries. The Company will furnish copies of any such instrument to the SEC upon request.
 
* Denotes a management contract or compensatory plan or arrangement. 
+ Filed herewith.    




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