2021 ANNUAL REPORT

Letter to Shareholders

2021 was a year when Citi reaffirmed its vital place in the world. As COVID-19 barreled along an unpredictable path, Citi continued to help clients and customers navigate the impacts of economic lockdowns, inflationary pressures and supply chain disruptions and access the short- and long-term liquidity they've needed to manage through the pandemic.

At the same time, we have seen more permanent shifts across our industry. Companies are going global at a record pace. Digitization has made scale and agility a competitive necessity. The line dividing business and politics has all but disappeared, creating an entirely new paradigm for multinationals. And companies are responding to calls from all stakeholder groups to become more purpose driven and take a leading role in sustainable practices.

In my conversations with clients and world leaders, they tell me this is the most complex landscape they can remember - but this is precisely the kind of environment in which Citi shines. For over 200 years, our global network has demonstrated the flexibility and resilience to adapt to the times. And with our unique global perspective, our on-the-ground knowledge, and our empathy and expertise, we are able to develop solutions to the toughest of problems. I am so proud of how our people have continued to step up and deliver for our clients and customers despite the challenges they have faced at home and in their personal lives.

Stability in unstable times

From an economic perspective, 2021 was a less volatile year, with a normalization of many but not all of our key business drivers and the release of much of the loan-loss reserves that we had set aside during the pandemic. That enabled us to generate net income of $22 billion on revenues of $71.9 billion, with a Return on Tangible Common Equity (RoTCE) of 13.4%. Excluding those reserve releases, our net income was $14.9 billion, and we had an RoTCE of 8.9%¹.

We ended 2021 with a solid balance sheet and a liquidity coverage ratio of 115%. Our Common Equity Tier 1 capital ratio at year-end was 12.2% as we prepared to adopt a new capital rule, the Standardized Approach for Counterparty Credit Risk (SA-CCR). During the year, we were able to return nearly $12 billion of capital to common shareholders.

Our institutional franchise had a very active year, advising and underwriting many significant deals. That included the largest spin-off and second-largest M&A transaction of 2021 and successful capital raises for the IPOs of a number of high-growth companies, such as the dating app Bumble and the game developer Krafton. We also served as joint global coordinator on the largest overnight trade on record, and we were an active bookrunner for the year's biggest U.S. dollar corporate bond offering, which was also the sixth-largest U.S. dollar transaction of all time.

Despite the headwinds of the low rate environment, our Treasury & Trade Solutions business maintained strong momentum. We saw robust client engagement and digital adoption, including a 96% year-over-year increase in digital account openings and a 62% increase in user engagement through our CitiDirect mobile banking platform. As transaction flows across CitiConnect digital channels grew by 38% compared with the prior year, we expanded our instant payments capability to 28 markets, now the largest footprint in the industry.

We continued to build out our leading custody platform, winning key mandates to provide post-trade services for some of our financial institution clients such as BlackRock. Citi Velocity, our digital platform for institutional clients, attracted about 200,000 unique client users in 2021, a 64% increase over 2020 and a 138% increase compared with 2019, before the pandemic.

For our consumer franchise, the picture was more mixed. Our wealth businesses continued their momentum. In our U.S. Retail and Cards businesses, government stimulus programs helped consumers accumulate additional savings, which translated into elevated payment rates and, consequently, a 5% decrease in loans and a 9% decrease in revenues.

But other key drivers were more encouraging, including higher purchase sales across our cards products and a pickup in cards loans at the end of the year. Customers clearly were reaching for their Citi card over other options in their wallet, a testament to our dynamic portfolio of products, which we further strengthened with the launch of the Citi Custom Cash card and renewals of key retail partnerships such as AT&T, Macy's and Tractor Supply Company.

In 2021, we also benefited from double-digit growth in deposits across our consumer franchise in the U.S. Our strategy to complement the great service we provide in our U.S. retail branches with best-in-class digital tools continued to pay off: We’ve received $20 billion in digital deposits, and more than two-thirds have come from customers outside of our branch footprint, with about half of those deposits from our cardholders who did not previously have a retail relationship with us.

Realizing our full potential

In March 2022, one year after I assumed the role of CEO, we held our first Investor Day since 2017. It was an opportunity to update our investors after a year of refreshing our strategy to focus our resources and energies on a compelling mix of businesses that can drive growth and higher returns. Going forward, we will be a firm focused on five core units - Services, Markets, Banking, U.S. Personal Banking and Global Wealth Management - with strong connectivity among them to bring the full power of Citi to our clients.

¹RoTCE represents annualized net income available to common shareholders as a percentage of average tangible common equity and is a non-GAAP financial measure. For a reconciliation to reported results, see page 44 of Citi's 2021 Annual Report on Form 10-K. In addition, net income excluding reserve releases is a non-GAAP financial measure.

Our vision for Citi is to be the pre-eminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in our home market. A key part of our strategy is investing in the Services businesses that are the heart of our global network and generate strong, fee-based returns. Through our Commercial Bank, we will expand our work with mid-sized companies who have aspirations to go global.

Another priority is our ambition in wealth management. By combining our Private Bank and consumer wealth businesses, we are creating a single, integrated platform to serve affluent consumers up through the ultra-high net worth segment. This also allows us to target clients in the middle of the wealth continuum, which to date has been largely untapped territory for us despite already having relationships with them in the Commercial Bank.

As we focus our resources in a more targeted way, we also have made some hard decisions about which businesses no longer fit into our vision for Citi. We have announced our intention to exit 14 of our consumer businesses in Asia, Europe and Mexico where there was not clear connectivity to the rest of our franchise. In every case, we are working to reach solutions that will provide optimal results for our people, clients and shareholders. Notwithstanding these decisions, Citi will continue to serve clients and invest in these markets through our institutional franchise and our Global Wealth Management business.

For our strategy to unlock the greatest possible value, we know we need an infrastructure that is scaled and agile and delivers a great user experience. The Consent Orders issued in 2020 by two of our U.S. regulators – the Federal Reserve Board (FRB) and Office of the Comptroller of the Currency (OCC) – underscored how we have underinvested in some of those areas for too long. In 2021, we launched an effort to address those deficiencies and simplify and modernize our operating model for the digital age. This work is so fundamental and consequential in nature that we call it our Transformation.

As part of our Transformation, we are enhancing our risk and controls environment to be more intuitive and automated. We are also improving how we organize and leverage the incredible amount of data we have as a global bank. Data can be a competitive advantage for us, helping us manage risk more efficiently, comply with regulations, deliver with excellence for our clients, identify revenue opportunities and achieve efficiencies.

Ensuring we have a culture characterized by excellence underpins the success of our Transformation. We have updated our leadership principles and adjusted our performance rating system, part of an effort to raise expectations and to increase accountability for how our people should approach their work. And by breaking down silos and deepening the sense of ownership that our people feel for the firm, we are building a culture that’s focused on delivering the best outcomes for all our stakeholders.

In 2021, we submitted our plan to the FRB and OCC. From the beginning of this work, we have been staying close to our regulators and keeping them updated on our progress. But it’s also important to note that our Transformation goes far beyond remediation. This is about modernizing our systems and structures so that we can better manage the speeds and complexities of the digital world. This is about putting Citi in the position to compete and win.

Taking into account our growth plan, the investments we are making in our businesses and efficiencies that will come out of our work, we believe we can increase shareholder value and achieve an RoTCE of 11%-12% in the next three to five years. Over the longer term, I believe that our strategy will lead to a higher-quality earnings mix, and we’ll further increase our returns as a result.

A bank with a brain and soul

Our environmental, social and governance (ESG) agenda builds on decades of leadership and is a reflection of the special responsibility we feel as a global bank to help solve many of society’s toughest challenges, such as the impending climate crisis. On my first day as CEO, we committed Citi to achieving net zero greenhouse gas emissions by 2050. Over the past year, we have been hard at work mapping out how we are going to get there, rolling up our sleeves to partner with our clients and guide the industry forward. Earlier this year, we released our initial plan, setting 2030 targets for our energy and power loan portfolios.

Our commitment to societal progress has also led us to take on the challenge of economic inclusion. Since launching our Action for Racial Equity initiative in 2020, we have invested more than $1 billion to help close the racial wealth gap in the U.S. That includes investing in Black-founded companies through our Citi Impact Fund, investing in minority depository institutions and inviting them to participate in revenue-generation opportunities alongside Citi, and committing equity to Black real estate developers to preserve affordable and workforce housing.

Across the globe, we have continued maximizing the impact we can make through financial innovation, particularly in our most underserved communities. Since 2007, we have helped 3.7 million women around the world launch or grow their businesses. In 2021, we issued a first-of-its-kind $1 billion social finance bond to increase access to essential services in emerging markets - part of a goal we set last year to expand access to housing, education and healthcare for 15 million low-income households, including 10 million women. Our recently announced plan to eliminate overdraft fee charges in the U.S. will also increase financial inclusion.

All told, we have committed $1 trillion to sustainable financing by 2030, which includes $500 billion toward environmental activities and $500 billion toward social activities. And every day, we are seeing how our ESG agenda is such a strong selling point for Citi in the perennial battle for talent.

Ensuring we have the right talent is critically important to our firm's success. Over the past year, we have attracted some tremendous new leaders to Citi and promoted our highest-performing leaders within the firm to new roles. I’m also proud that we recently met and exceeded goals to increase the representation of women and Black colleagues in our senior ranks - and we did so by embedding these goals in our business strategy, strengthening our talent pipelines, evolving our recruitment and hiring, promoting internally and making Citi a more attractive place to work. In other words, we lifted everyone up.

As we look to the horizon, the stakes could not be higher – the world is only becoming more complex and more competitive. But at Citi, we are determined to seize this moment. We are excited about the work we have done over the past year to focus our strategy on where we can win. And we are confident we have put Citi on the right path to improve returns over the long term and deliver the full benefits of our firm to all our stakeholders.

Sincerely,

Jane Fraser
Chief Executive Officer, Citigroup Inc.

²See page 11 of Citi's 2021 Form 10-K.
³See page 11 of Citi's 2021 Form 10-K.
⁴See page 16 of Citi's 2021 Form 10-K.

EMBEDDING ESG ACROSS OUR BUSINESSES

Stockholder Information

Citigroup common stock is listed on the NYSE under the ticker symbol "C." Citigroup preferred stock Series J and K are also listed on the NYSE.

Because Citigroup's common stock is listed on the NYSE, the Chief Executive Officer is required to make an annual certification to the NYSE stating that she was not aware of any violation by Citigroup of the corporate governance listing standards of the NYSE. The annual certification to that effect was made to the NYSE on May 21, 2021.

As of January 31, 2022, Citigroup had approximately 61,355 common stockholders of record. This figure does not represent the actual number of beneficial owners of common stock because shares are frequently held in "street name" by securities dealers and others for the benefit of individual owners who may vote the shares.

Transfer Agent

Stockholder address changes and inquiries regarding stock transfers, dividend replacement, 1099-DIV reporting and lost securities for common and preferred stock should be directed to:

Computershare
P.O. Box 505005
Louisville, KY 40233-5005
Telephone No. 781 575 4555
Toll-free No. 888 250 3985
E-mail address: shareholder@computershare.com
Web address: www.computershare.com/investor

Exchange Agent

Holders of Golden State Bancorp, Associates First Capital Corporation or Citicorp common stock should arrange to exchange their certificates by contacting:

Computershare
P.O. Box 505004
Louisville, KY 40233-5004
Telephone No. 781 575 4555
Toll-free No. 888 250 3985
E-mail address: shareholder@computershare.com
Web address: www.computershare.com/investor

On May 9, 2011, Citi effected a 1-for-10 reverse stock split. All Citi common stock certificates issued prior to that date must be exchanged for new certificates by contacting Computershare at the address noted above.

Citi's 2021 Form 10-K filed with the SEC, as well as other annual and quarterly reports, are available from Citi Document Services toll free at 877 936 2737 (outside the United States at 716 730 8055), by e-mailing a request to docserve@citi.com or by writing to:

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Stockholder Inquiries

Information about Citi, including quarterly earnings releases and filings with the U.S. Securities and Exchange Commission, can be accessed via Citi's website at www.citigroup.com. Stockholder inquiries can also be directed by e-mail to shareholderrelations@citi.com