SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-Q

Commission file number 1-9924

Citigroup Inc.
(Exact name of registrant as specified in its charter)

399 Park Avenue, New York, New York 10043
(Address of principal executive offices) (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 ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ý                Accelerated filer o                Non-accelerated filer 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 ý

        Indicate the number of shares outstanding of each of the issuer's classes of common stock as of the latest practicable date:

Common stock outstanding as of September 30, 2006: 4,913,666,8262007: 4,981,134,274

Available on the Web at www.citigroup.com

Citigroup Inc.

TABLE OF CONTENTS

THE COMPANY

        Citigroup Inc. (Citigroup orand, together with its subsidiaries, the Company) is a diversified global financial services holding company whosecompany. Our businesses provide a broad range of financial services to consumer and corporate clients.customers. Citigroup has somemore than 200 million clientcustomer accounts and does business in more than 100 countries. Citigroup was incorporated in 1988 under the laws of the State of Delaware.

        The Company is a bank holding company within the meaning of the U.S. Bank Holding Company Act of 1956 registered with, and subject to examination by, the Board of Governors of the Federal Reserve System (FRB). Some of the Company's subsidiaries are subject to supervision and examination by their respective federal, state and stateforeign authorities.

        This quarterly report on Form 10-Q should be read in conjunction with Citigroup's 20052006 Annual Report on Form 10-K.10-K and Citigroup's Quarterly Reports on Form 10-Q for the quarter ended March 31, 2007 and June 30, 2007. Additional financial, statistical, and business-related information, as well as business and segment trends, is included in a Financial Supplement that was filed as Exhibit 99.2 to the Company's Current Report on Form 8-K, filed with the Securities and Exchange Commission (SEC) on October 15, 2007.

        The principal executive offices of the Company are located at 399 Park Avenue, New York, New York 10043,10043. The telephone number 212-559-1000.is 212 559 1000. Additional information about Citigroup is available on the Company's Web site atwww.citigroup.com. Citigroup's annual report on Form 10-K, its quarterly reports on Form 10-Q, its current reports on Form 8-K, and all amendments to these reports are available free of charge through the Company's Webweb site by clicking on the "Investor Relations" page and selecting "SEC Filings." The Securities and Exchange Commission (SEC) WebSEC's web site contains reports, proxy and information statements, and other information regarding the Company atwww.sec.gov.

        Citigroup iswas managed along the following segment and product lines:lines through the third quarter of 2007:

The following are the six regions in which Citigroup operates. The regional results are fully reflected in the product results.

(1)

Disclosure includes Canada and Puerto Rico.

CITIGROUP INC. AND SUBSIDIARIES

SUMMARY OF SELECTED FINANCIAL DATA

        The Company has revised its financial results for the third quarter of 2007 from the results released in the Company's October 15, 2007 Earnings Release and Current Report on Form 8-K filing. The revision relates to the correction of the valuation on the Company's $43 billion in Asset-Backed Securities Collateralized Debt Obligations (ABS CDOs) super senior exposures (see page 6 and 9 for further detail). The impact of this correction is a $270 million reduction in Principal Transactions Revenue, a $166 million reduction in Net Income and a $0.03 reduction in Diluted Earnings per Share.

(1)

Reclassified to conform to the current period's presentation.

(2)

Discontinued operations for the three months and nine months ended September 30, 2006 and 2005 includes the operations described inrelates to residual items from the Company's June 24,sale of Travelers Life & Annuity, which closed during the 2005 announced agreement forthird quarter, and the Company's sale of substantially all of its Asset Management business to Legg Mason. The majority ofBusiness, which closed during the transaction closed on December 1, 2005. Discontinued operations also includes the operations (and associated gain) described in the Company's January 31, 2005 announced agreement for the sale of its Travelers Life & Annuity business, substantially all of its international insurance business, and its Argentine pension business to MetLife, Inc. This transaction closed on July 1, 2005.fourth quarter. See further discussion regarding discontinued operations in Note 3 to the Consolidated Financial Statements2 on page 94.57.

(3)(2)

The return on average common stockholders' equity and return on average total stockholders' equity areis calculated using net income after deductingminus preferred stock dividends.

(4)(3)

Risk capital is a measure of risk levels and the trade offtrade-off of risk and return. It is defined as the amount of capital required to absorb potential unexpected economic losses resulting from extremely severe events over a one-year time period. Return on risk capital is calculated as annualized income from continuing operations divided by average risk capital. Invested capital is defined as risk capital plus goodwill and intangible assets excluding mortgage servicing rights (which are a component of risk capital). Return on invested capital is calculated using income adjusted to exclude a net internal charge Citigroup levies on the goodwill and intangible assets of each business, offset by each business' share of the rebate of the goodwill and intangible asset charge. Return on risk capital and return on invested capital are non-GAAP performance measures; because they are measures of risk with no basis in GAAP, there is no comparable GAAP measure to which they can be reconciled. Management uses return on risk capital to assess businesses' operational performance and to allocate Citigroup's balance sheet and risk capital capacity. Return on invested capital is used to assess returns on potential acquisitions and to compare long-term performance of businesses with differing proportions of organic and acquired growth. See page 5226 for a further discussion of Risk Capital.risk capital.

(5)(4)

Tier 1 capitalCapital divided by adjusted average assets.

(6)NM

Dividends declared per common share as a percentage of net income per diluted share.Not meaningful

MANAGEMENT'S DISCUSSION AND ANALYSIS

THIRD QUARTER 2007 MANAGEMENT SUMMARY

        Income from continuing operations of $5.303declined 58% to $2,212 billion in the 2006 third quarter was up 6% from the 2005 third quarter. Dilutedand diluted EPS from continuing operations was down 58%. The write-downs of highly-leveraged loans, losses in our Fixed Income structured credit and credit trading business and higher credit costs in our Global Consumer business drove the earnings decline. Results include a $729 million pretax gain on the sale of Redecard shares.

        Revenues were $22.4 billion, up 9%,5% from a year ago, primarily due to 29% growth in international revenues and partially offset by weakness in ourSecurities and Bankingbusiness, where revenues were down 50%. International Consumer revenues were up 35% and International Global Wealth Management revenues more than doubled reflecting double-digit organic growth and results from Nikko Cordial. U.S. Consumer revenues were flat to a year-ago while Alternative Investments revenues declined 63%.Transaction Serviceshad another record quarter, with the increment in the growth rate reflecting the benefit from our share repurchase program. Net income, which includes discontinued operations, was $5.505 billion in the quarter, down 23% from the 2005 third quarter.revenues up 38%.

        During the 2006 third quarter, we continued to execute on our key strategic initiatives, including the opening of a record 277 new Citibank and CitiFinancial branches (176 in International and 101 in the U.S.).

        Customer volume growth was strong, with average loans up 15%18%, average deposits up 18%20%, and average interest-earning assets up 16% from year-ago levels. U.S.36%.International Cards accounts were up 27% and purchase sales were up 9%37%, whileU.S. Cardssales were up 6%. Citibank Direct, our Internet bank, has raised almost $8 billion in deposits.

*    Excludes Japan Automated Loan Machines (ALMs).

        Revenues were approximately even with the 2005 third quarter, at $21.4 billion. Our international operations recorded revenue growth of 11% in the quarter, with International Consumer up 9%, International CIB up 12% and InternationalIn Global Wealth Management, client assets under fee-based management were up 33%38%. Branch activity included the opening or acquisition of 96 new branches during the quarter (47 internationally and 49 in the U.S. Consumer revenues grew 1%).

        Since October of 2006, ten international acquisitions have been announced, consistent with our goal of expanding our international franchise through targeted acquisitions. On October 2, 2007, we announced an agreement to acquire the remaining 32% public stake in Nikko Cordial in a share-for-share exchange using Citigroup stock.

        International businesses contributed 54% of the Company's revenue in the third quarter of 2007 and 79% of income, up from 44% and 43%, while CIB and Alternative Investments revenues declined 6% and 54%, respectively.respectively, a year ago.

        Net interest revenue increased 1%24% from last year as higher deposit and loan balances were offset by pressure on net interest margins.reflecting volume increases across all products. Net interest margin in the 2006 third quarter of 2007 was 2.62%2.36%, down 3626 basis points from the 2005 third quarter of 2006, as lower funding costs were offset by growth in lower-yielding assets in our trading businesses, and down 11 basis points from the 2006 second quarter. The largest driver of the decline from the 2006 second quarter was trading activitiesincreased ownership in Nikko Cordial (see discussion of net interest margin on page 67)33).

        Operating expenses increased 5%22% from the 2005 third quarter; thisquarter of 2006 driven by increased business volumes and acquisitions (which contributed 8%). The increase is due in large part to an unusually low level of expenses in the third quarter of 2006, which were the lowest in the last seven quarters, primarily reflecting reductions in advertising and marketing in U.S. Consumer, and lower expenses in Markets & Banking. Our business as usual expense growth of 14% was compriseddriven by higher business volumes throughout the franchise and the opening of 3 percentage pointsmore than 800 branches in the last 12 months. We are ahead of commitments on our Strategic Expense Initiatives. Expenses were down from the second quarter of 2007, primarily on lower compensation costs inSecurities and Banking.

        Credit costs increased $2.98 billion from year-ago levels, primarily driven by an increase in investment spendingnet credit losses of $780 million and 2 percentage points duea net charge of $2.24 billion to SFAS 123(R) accruals. Excluding investment spendingincrease loan loss reserves. In U.S. Consumer, higher credit costs reflected an increase in net credit losses of $278 million and SFAS 123(R) accruals, expenses were flat with the prior year. Expenses were down $833a net charge of $1.30 billion to increase loan loss reserves. The $1.30 billion net charge compares to a net reserve release of $197 million from the 2006 second quarter.

        Income was diversified by segment and region, as shown in the charts below.

*    Excludes Corporate/Other.		*    Excludes Alternative Investments and Corporate/Other.

prior-year period. The U.S.increase in credit environment remained stable; this,costs primarily reflected a weakening of leading credit indicators, including increased delinquencies in first and second mortgages and unsecured personal loans, as well as significantly lower consumer bankruptcy filings,trends in the absenceU.S. macro-economic environment, portfolio growth, and a change in estimate of loan losses inherent in the 2005 third quarter $490portfolio but not yet visible in delinquencies (referred to hereinafter as the change in estimate of loan losses). In International Consumer, higher credit costs reflected an increase in net credit losses of $460 million pretaxand a net charge relatedof $717 million to increase loan loss reserves. The $717 million net charge compares to a net charge of $101 million in the EMEA consumer write-off policy change, and an asset mix shift, drove a $782 million decreaseprior-year period. The increase in credit costs comparedprimarily reflected the impact of recent acquisitions, portfolio growth, and a change in estimate of loan losses. Markets & Banking credit costs increased $98 million, primarily reflecting higher net credit losses and a $123 million net charge to year-ago levels.increase loan loss reserves for specific counterparties. Credit costs reflected a slight weakening in portfolio credit quality. The Global Consumer loss rate was 1.49%1.81%, a 119 basis point decline32 basis-point increase from the 2006 third quarter reflecting the absence of the 2005 third quarter $1.153 billion write-off related to the policy change in EMEA and significantly lower bankruptcy filings.2006. Corporate cash-basis loans declined 13%increased 76% from June 30, 2006year-ago levels to $692 million.$1.218 billion.

        The Company's effective income tax rate of 19.4% in the third quarter of 2007 reflects the tax benefits of permanent differences applied to the lower level of consolidated pretax earnings. These permanent differences primarily include the tax benefit for not providing U.S. income taxes on continuing operations declined tothe earnings of certain foreign subsidiaries that are indefinitely invested. The third quarter of 2006 effective tax rate of 27.4%, primarily reflecting included a $237 million tax reserve release relatedin continuing operations relating to the resolution of the 2006 New York Tax Audits. The effective tax rate for the 2006 third quarter would have been 30.6% without the tax reserve release.

        Our stockholders' equity capital base and trust preferred securities grew to $125.9were $138.7 billion at September 30, 2006. Stockholders' equity increased by $2.4 billion during the quarter to $117.9 billion.2007. We distributed $2.5$2.7 billion in dividends to shareholders and repurchased $2.0 billion of common stock during the quarter.

Return on common equity was 18.9%6.9% for the quarter. Citigroup maintained its "well-capitalized" position with a Tier 1 Capital Ratio of 8.64%7.32% at September 30, 2006. On September 26, 2006, Moody's upgraded Citibank, N.A.'s Credit Rating2007.

        In our U.S. Consumer business, revenue generated was affected by the market dislocation that also affected our fixed income business; however, the underlying business momentum that we have seen over the last few quarters continues to "Aaa" from "Aa1."

        As we move intobe very good. The Company expects that credit costs in the fourth quarter of 2007 will increase compared to the fourth quarter of 2006 with the expectation that the U.S. consumer credit environment will continue to deteriorate causing higher credit costs.

        On October 12, 2007, we announced the formation of our priorities remain clear:Institutional Clients Group which combines our Markets & Banking and Alternative Investments businesses which will

enhance our ability to execute our strategic initiativesserve institutional clients across the entire capital market spectrum. Vikram Pandit will lead this newly formed Group.

        On November 4, 2007, the Company announced significant declines since September 30, 2007 in the fair value of the approximately $55 billion in U.S. sub-prime related direct exposures in its Securities and Banking business. Citigroup estimates that, at the present time, the reduction in revenues attributable to drive organic revenue andthese declines ranges from approximately $8 billion to $11 billion (representing a decline of approximately $5 billion to $7 billion in net income growth,on an after-tax basis). See page 9 for a further discussion.

        On November 4, 2007, the Company's Board of Directors announced that Charles Prince, Chairman and Chief Executive Officer, has elected to make targeted acquisitions,retire from Citigroup. Robert E. Rubin, Chairman of the Executive Committee of Citigroup and a member of the Board of Directors, will serve as Chairman of the Board. In addition, Sir Win Bischoff, Chairman of Citi Europe and a member of Citigroup's Business Heads, Operating and Management Committees, will serve as acting Chief Executive Officer (CEO). The Board also announced that The Board has designated a special committee consisting of Mr. Rubin, Alain J.P. Belda, Richard D. Parsons, and Franklin A. Thomas to maintain expense discipline and to generate superior returnsconduct the search for our owners.

EVENTS IN 2006 and 2005a new CEO.

        Certain of the statements belowabove are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. See "Forward-Looking Statements" on page 84.48.

AcquisitionEVENTS IN 2007 AND 2006

        Certain of Grupo Financiero Unothe following statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. See "Forward-Looking Statements" on page 48. Additional information regarding "Events in 2007 and 2006" is available in the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2007 and June 30, 2007, and in the Company's Annual Report on Form 10-K for the year ended December 31, 2006.

3Q07 Items Impacting the Securities and Banking Business

CDO- and CLO-Related Losses

        During the third quarter of 2007, unrealized losses of approximately $1.8 billion pre-tax, net of hedges, were recorded in theSecurities and Bankingbusiness due to a decline in value of sub-prime mortgage-backed securities warehoused for future collateralized debt obligation (CDO) securitizations, CDO positions, and leveraged loans warehoused for future collateralized loan obligation (CLO) securitizations.

        The $1.8 billion pretax of net write-downs consisted of $1.0 billion on asset-backed CDOs (primarily taken on the Company's CDO inventory which totaled $2.7 billion at September 30, 2007 inclusive of the write-down), $0.5 billion on super senior tranches of CDOs (senior-most positions of the capital structure where the predominant collateral is sub-prime U.S. residential mortgage-backed securities) and $0.3 billion on CLOs.

        Certain types of credit instruments, such as investments in CDOs, high-yield bonds, debt issued in leveraged buyout transactions, mortgage- and asset-backed securities, and short-term asset- backed commercial paper, became very illiquid in the third quarter of 2007 and this contributed to the declines in value of those securities.

Write-downs on Highly-Leveraged Loans and Commitments

        During the third quarter of 2007, Citigroup recorded write downs of approximately $1.352 billion pre-tax, net of underwriting fees, on funded and unfunded highly-leveraged finance commitments in theSecurities and Bankingbusiness. Of this amount, approximately $901 million related to debt underwriting activities and $451 million related to lending activities. Write-downs were recorded on all highly-leveraged finance commitments where there was value impairment, regardless of the expected funding date.

Fixed Income Credit Trading Losses

        During the third quarter of 2007, Citigroup recognized approximately $636 million in credit trading losses due to significant market volatility and the disruption of historical pricing relationships. This was primarily a result of the sharp decrease in the sub-prime markets in both North America and Europe. The resulting trading losses are reflected in theSecurities and Bankingbusiness.

Market Value Gains Due to the Change in Citigroup Credit Spreads

        SFAS 159 provides companies the ability to elect fair value accounting for many financial assets and liabilities. As part of Citigroup's adoption of this standard in the first quarter of 2007, the Company elected the fair value option on debt instruments that are provided to customers so that this debt and the associated assets the Company purchased to meet this liability are on the same fair value basis in earnings. At the end of the third quarter, $28.6 billion of debt related to customer products was classified as either short- or long-term debt on the Consolidated Balance Sheet.

        Under fair value accounting, we are required to use Citigroup credit spreads in determining the market value of any Citigroup liabilities for which the fair value option was elected, as well as for Citigroup trading liabilities such as derivatives. The inclusion of Citigroup credit spreads in valuing Citigroup's liabilities gave rise to a pre-tax gain of $466 million in the third quarter of 2007 and is reflected in theSecurities and Bankingbusiness.

Credit Reserves

        During the third quarter of 2007, the Company recorded a net build of $2.24 billion to its credit reserves, including an increase in the allowance for unfunded lending commitments, consisting of a net build of $2.07 billion in Global Consumer and Global Wealth Management and $171 million in Markets & Banking.

        The build of $2.07 billion in Global Consumer and Global Wealth Management primarily reflected a weakening of leading credit indicators, including increased delinquencies in first and second mortgages and unsecured personal loans, as well as trends in the U.S. macro-economic environment, portfolio growth, recent acquisitions, and the change in estimate of loan losses.

        The build of $171 million in Markets & Banking primarily reflected loan loss reserves for specific counterparties. Credit costs reflected a slight weakening in portfolio credit quality.

        The net build to the Company's credit reserves in the third quarter of 2007 compares to the third quarter of 2006 net build of $37 million, which consisted of a net release/ utilization of $79 million in Global Consumer and Global Wealth Management, and a net build of $116 million in Markets & Banking.

Redecard IPO

        During July and August 2007, Citigroup (a 31.9% shareholder in Redecard S.A., the only merchant acquiring company for MasterCard in Brazil) sold approximately 48.8 million Redecard shares in connection with Redecard's initial public offering in Brazil. Following the sale of these shares, Citigroup retained approximately 23.9% ownership in Redecard. An after-tax gain of approximately $469 million ($729 million pretax) was recorded in Citigroup's third quarter of 2007 financial results in theInternational Cardsbusiness.

CAI's Structured Investment Vehicles (SIVs)

        CAI's Global Credit Structures investment center is the investment manager for seven Structured Investment Vehicles (SIVs). SIVs are special purpose investment companies that seek to generate attractive risk-adjusted floating-rate returns through the use of financial leverage and credit management skills, while hedging interest rate and currency risks and managing credit, liquidity and operational risks. The basic investment strategy is to earn a spread between relatively inexpensive short-term funding (commercial paper and medium-term notes) and high quality asset portfolios with a medium-term duration, with the leverage effect providing attractive returns to junior note holders, who are third-party investors and who provide the capital to the SIVs.

        Citigroup has no contractual obligation to provide liquidity facilities or guarantees to any of the Citi-advised SIVs and does not own any equity positions in the SIVs. The SIVs have no direct exposure to U.S. sub-prime assets and have approximately $70 million of indirect exposure to sub-prime assets through CDOs which are AAA rated and carry credit enhancements. Approximately 98% of the SIVs' assets are fully funded through the end of 2007. Beginning in July 2007, the SIVs which Citigroup advises sold more than $19 billion of SIV assets, bringing the combined assets of the Citigroup-advised SIVs to approximately $83 billion at September 30, 2007. See additional discussion on page 46.

        The current lack of liquidity in the Asset-Backed Commercial Paper (ABCP) market and the resulting slowdown of the CP market for SIV-issued CP have put significant pressure on the ability of all SIVs, including the Citi-advised SIVs, to refinance maturing CP.

        While Citigroup does not consolidate the assets of the SIVs, the Company has provided liquidity to the SIVs at arm's-length commercial terms totaling $10 billion of committed liquidity, $7.6 billion of which has been drawn as of October 31, 2007. Citigroup will not take actions that will require the Company to consolidate the SIVs.

Master Liquidity Enhancing Conduit (M-LEC)

        In October 2007, Citigroup, J.P. Morgan Chase and Bank of America initiated a plan to back a new fund, called the Master Liquidity Enhancing Conduit (M-LEC) that intends to buy assets from SIVs advised by Citigroup and other third-party institutions. This is being done as part of an effort to avert the situation where the SIVs will be forced to liquidate significant amounts of mortgage-backed securities, resulting in a broad-based repricing of these assets in the market at steep discounts.

        SIVs, including those advised by Citigroup, have experienced difficulties in refinancing maturing commercial paper and medium-term notes, due to reduced liquidity in the market for commercial paper.

Nikko Cordial

        Citigroup began consolidating Nikko Cordial's financial results and the appropriate minority interest on May 9, 2007, when Nikko Cordial became a 61%-owned subsidiary. Citigroup later increased its ownership stake in Nikko Cordial to 68%. Nikko Cordial results are included within Citigroup'sSecurities and Banking, Global Wealth ManagementandGlobal Consumer Groupbusinesses.

        On October 27, 2006,31, 2007, Citigroup announced a definitive agreement with Nikko Cordial to acquire all Nikko Cordial shares that it had reachedCitigroup does not already own in exchange for shares of Citigroup. The agreement provides for the exchange ratio to be determined in mid-January 2008 and for the transaction to close on January 29, 2008. As of the date of the agreement, the transaction value for the acquisition of the remaining Nikko shares was approximately $4.6 billion.

        On October 29, 2007, Citigroup received approval from the Tokyo Stock Exchange (TSE) to list Citigroup's shares on the TSE effective on November 5, 2007.

Acquisition of Bisys

        On August 1, 2007, the Company completed its acquisition of Bisys Group, Inc. (Bisys) for $1.47 billion in cash. In addition, Bisys' shareholders received $18.2 million in the form of a special dividend paid by Bisys. Citigroup completed the sale of the Retirement and Insurance Services Divisions of Bisys to affiliates of J.C. Flowers & Co. LLC, making the net cost of the transaction to Citigroup approximately $800 million. Citigroup retained the Fund Services and Alternative Investment services businesses of Bisys which provides administrative services for hedge funds, mutual funds and private equity funds. Results for Bisys are included within Citigroup'sTransaction Servicesbusiness from August 1, 2007 forward.

Agreement to Establish Partnership with Quiñenco—Banco de Chile

        On July 19, 2007, Citigroup and Quiñenco entered into a definitive agreement to acquire Grupo Financiero Uno (GFU), the largest credit card issuerestablish a strategic partnership that combines Citi operations in Central America,Chile with Banco de Chile's local banking franchise to create a banking and its affiliates. The acquisition of GFU,financial services institution with $2.1 billion in assets, will expand the presence of Citigroup's Latin America consumer franchise, enhancing its credit card business in the region and establishing a platform for regional growth in consumer finance and retail banking.

        GFU is privately held and has more than one million retail clients, representing 1.1 million credit card accounts, $1.2 billion in credit card receivables and $1.3 billion in deposits in Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and Panama as of September 30, 2006. GFU operates a distribution network of 75 branches and more than 100 mini- branches and points of sale.

        The transaction, which is subject to regulatory approvals in the United States and eachabout 20% market share of the six countries, is anticipatedChilean banking industry. The agreement gives Citigroup the option to closeacquire up to 50% of LQIF, the holding company through which Quiñenco controls Banco de Chile.

        Under the agreement, Citigroup will initially acquire 18.77% interest in Banco de Chile through its approximate 32.85% stake in LQIF. In the 2007 first quarter.initial phase, Citigroup will contribute Citigroup Chile and other assets (in cash or other businesses). As part of the overall transaction, Citigroup will also acquire the U.S. businesses of Banco de Chile. Citigroup has the option to acquire an additional 17.04% stake in LQIF within three years. The new partnership calls for active

participation by Citigroup in management of Banco de Chile, including board representation at both LQIF and Banco de Chile.

Sale of Avantel

        On October 26, 2006, the Company agreed to sell Avantel, a leading telecom service provider in Mexico, to Axtel. The transaction is expected to result in an approximately $140 million after-tax gain ($310 million pretax).        The transaction is expected to close in the 2006 fourthfirst quarter of 2008, and is subject to Mexicancustomary regulatory and Axtel shareholder approvals. Avantel was acquired byreviews. Citigroup as partwill account for the investment in LQIF under the equity method of its acquisitionaccounting.

Acquisition of Banamex in 2001.

Purchase of 20% Equity Interest in AkbankAutomated Trading Desk

        On October 17, 2006, the Company announced that it had signed3, 2007, Citigroup completed its acquisition of Automated Trading Desk (ATD), a definitive agreement for the purchase of a 20% equity interestleader in Akbankelectronic market making and proprietary trading, for approximately $3.1 billion. Akbank, the second-largest privately-owned bank by assets$680 million ($102.6 million in Turkey, iscash and approximately 11.17 million shares of Citigroup stock). ATD will operate as a premier, full-service retail, commercial, corporate and private bank.

        Sabanci Holding, a 34% owner of Akbank shares, and its subsidiaries have granted Citigroup a right of first refusal or first offer over the sale of any of their Akbank shares in the future. Subject to certain exceptions, Citigroup has agreed not to acquire additional shares in Akbank.

        The transaction, which is subject to shareholder and regulatory approvals, is expected to close during the 2006 fourth quarter or 2007 first quarter and will be accounted for under the equity method.

Final Payment from the Sale of the Asset Management Business

        In September 2006, the Company received the final closing adjustment payment related to the sale of its Asset Management business to Legg Mason, Inc. (Legg Mason). This payment resulted in an additional after-tax gain of $51 million ($83 million pretax), recorded in Discontinued Operations.

Final Settlement of the Travelers Life & Annuity Sale

        In July 2006, the Company received the final closing adjustment payment related to the saleunit of Citigroup's Travelers Life & AnnuityGlobal Equities business, adding a network of broker/dealer customers to Citigroup's diverse base of institutional, broker/dealer and substantially allretail customers.

Resolution of its international insurance businesses to MetLife, Inc. (MetLife). This payment resulted in an after-tax gain of $75 million ($115 million pretax), recorded in Discontinued Operations.2006 Tax Audits

Settlement of New York State and New York City Tax Audits

        In September 2006, Citigroup reached a settlement agreement with the New York State and New York City taxing authorities regarding various tax liabilities for the years 1998 - 1998–2005 (referred to above and hereinafter as the "resolution of the 2006 New York Tax Audits").

        For the 2006 third quarter, the Company released $254 million from its tax contingency reserves, which resulted in increases of $237 million in after-tax income from continuing operations and $17 million in after-tax income from discontinued operations.operations, which are reflected in the year-to-date 2006 totals.

Federal

        In March 2006, the Company received a notice from the Internal Revenue Service (IRS) that they had concluded the tax audit for the years 1999 through 2002 (referred to hereinafter as the "resolution of the 2006 Federal Tax Audit"). For the 2006 first quarter, the Company released a total of $657 million from its tax contingency reserves related to the resolution of the Federal Tax Audit, which are reflected in the segment and product year-to-date 2006 income tax expense disclosures.

        The following table summarizes the 2006 third quarter tax benefit,benefits, by business, from the resolution of the New York Tax Audits: