logo
Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?

Register
    

 


Citigroup To Become First U.S. Bank With Offices In Iraq

By  +Follow June 24, 2013 11:37AM
Share:
Tickers Mentioned:

Citigroup

In a move that may appear more than a little risky to say the least, the Financial Times reported on Monday morning that Citigroup (C) is set to become the first U.S. bank to open representative offices in the oil-rich and war-torn country of Iraq.

The announcement comes at a time when the bank, headed by new CEO Mike Corbat, is in the process of reconsidering many of its foreign offices for closure. But Citi, like many institutions, has had its eyes on Iraq since the controversial and globally unpopular 2003 Anglo-American invasion, having provided financial services to companies operating in the country via its offices in Dubai, Amman, and London.

Though the Bush administration reassured the world that coalition forces entering the country to personally unsure the removal of Ba’athist dictator Saddam Hussein would be welcomed as liberators, the invasion upset a decades-old sectarian balance that had a roughly 20 percent Sunni minority dominating a far larger majority of Shi’ites, some 60 percent of the populace, as well as another 20 percent of ethnic Kurds located mainly in the north. Iraq’s ethnically diverse society also includes a significant but rapidly dwindling Christian community that is one of the world’s oldest.

Iraq’s civilian infrastructure, as well as its formerly proud and nationalized oil industry, had already been vastly decimated by some ten years of Western-imposed sanctions that have been blamed for destroying what was once on the brink of becoming a first-world country. The absolutely brutal sectarian civil war that was set off by the invasion and is still ongoing has destroyed what little was left of that legacy, and has furthermore caused a situation in which a country previously known for its relative secularism and interfaith harmony, however dictatorially imposed this may have been, has become one defined by an entrenched sectarian animosity and defacto Balkanization.

After numerous unmet promises from the Bush administration that the Iraq’s enormous oil reserves would pay for both the invasion as well as reconstruction, Citigroup estimates that oil exports will provide for a $2 trillion economy by 2050 (the war itself has cost the U.S. some $3 trillion and counting, according to Nobel prize-winning economist Joseph Stiglitz). The bank plans to open offices in the capital Baghdad, as well as in the Northern Kurdish city of Erbil (said to be the world’s longest-standing city), and the Southern port city of Basra.

It is a “toe in the water” strategy on the part of Citi, who plans to expand these offices into full branches sometime within the next year, likely depending on the security situation. But while Citi’s estimates about the future size of the Iraqi economy are probably inarguable, as oil firms and related industrial and construction companies have finally been awarded the rebuilding contracts for which they have been clamoring for years, there are a number of obstacles for the foreseeable future.

Primarily, the ever-expanding civil war next door in Syria has breathed life into Iraq’s Sunni extremist groups that had previously been all but crushed. Quite the opposite of Iraq, Syria is a country whose 60 percent Sunni majority has been brutally dominated for decades by a group of much smaller minorities led by the al-Assad family that has run the place as its own personal fiefdom for decades. Cross-border cooperation between Sunni extremists has become nearly institutionalized over the past two years of hostilities in Syria.

Additionally, there has been a growing and increasingly significant, if completely unreported, push-back against the involvement of foreign oil companies and other interests on the part of the country’s trade unions, as has been described in detail by Greg Muttitt’s excellent recent book on the subject “Fuel on the Fire: Oil and Politics in Occupied Iraq”. Both of these developments taken together are extremely fluid and could make it very difficult indeed for oil companies and others to secure the returns that have been promised for years by various politicians and other vested interests seeking to justify or profit from the 2003 invasion.

This perhaps explains, for now at least, the “toe in the water” strategy on the part of Citi, especially when other banks like HSBC (HBC) are putting their operations in the country under review. Initially, Citi will not be allowed to engage in full-on banking activities, though that is the eventual goal. For the time being, it will provide support services to the bank’s many clients operating in the country.

Shares for Citigroup were down 2.5 percent on Monday in midday trading to $45.73 against the backdrop of a steep sell-off in markets both domestic and global.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


Liked What You Read? Join Equities.com as a contributor and get eyeballs on your content FOR FREE!

Results for c
BreakingStocksNews
24 May 15 04:59:02
$C: Interest Rates for Home Mortgages at Commerce Bank, Citibank ...: http://t.co/ZkW6hLmaQD
royfberger
24 May 15 04:58:05
True balls. $AAPL $GOOG $INTC $MTW $CAT $X $C $CSCO $T $SE $WU $MU $WBA http://t.co/8mR4s08jCl http://t.co/avjsFzAXRq
Hector
24 May 15 04:22:12
RT @seeitmarket: Are Bank Stocks Ready To Lead The Market Higher? http://t.co/Tf6wSOfqvw by @andrewnyquist $BKX $JPM $GS $WFC $C $BAC
Buffonge Aldwark
24 May 15 02:13:11
U.S. Treasury to Sell $72 Billion in Long-Term Debt $BAC $C $GS $JPM $MS
StockenheimerSchmidt
24 May 15 02:08:08
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3Eq6QC $VRS $LAS $C $WFC
Penny Stockington
24 May 15 02:07:53
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVU6RRw $VRS $LAS $C $WFC
Stock Rocket
24 May 15 02:06:48
Our Stock Alerts Gained Over 1300% In Less Than 3 Months! See Our New Picks: http://t.co/keLIhbtrUQ $VRS $LAS $C $WFC
DISH_NETWORK
24 May 15 01:44:57
$2015 Ki BiG ID $All SatLite Update $New Channel $New Biss Key $ALL SiM Trix $MoBiLe Trix $C_LINE ON @DISHTRIXS_HD SND:40404 03147756025 ...
azaz.sxsx
24 May 15 01:44:31
QWEWy _ommelDeGuzma16 I2R~ gSsmlHGVuUrISxK 'cd $c/k/
Stock Dawgzz
24 May 15 01:03:09
$DRNK Has Become One Of The Fastest Moving Penny Stocks In The Past 2 weeks! Big News: http://t.co/vFCVfQa85k $BMSN $C $GE
Penny Stockington
24 May 15 01:02:04
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVUosJ4 $BMSN $C $GE
StockenheimerSchmidt
24 May 15 01:00:41
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3E8vs2 $BMSN $C $GE
Stock Rocket
24 May 15 00:58:51
Our Stock Alerts Gained Over 1300% In Less Than 3 Months! See Our New Picks: http://t.co/keLIhbbQwg $BMSN $C $GE
Stockaholics
24 May 15 00:57:46
Our Penny Stock Pick On $THCZ Is Up 570.77% For Platinum Members! Big Update: http://t.co/dXhKtfHUdQ $BMSN $C $GE
FinSentS SP500
23 May 15 23:06:50
$C:US Citigroup to Sell Foreign-Exchange Accounts to Saxo Bank, FXCM #CITIGROUP INC http://t.co/oVfWkPe63h #SP500
SC_AOB
23 May 15 22:20:42
Check out "Jus Another Day In South Central" by $c - http://t.co/WVopXylETU #vote4sc @CraZyGameEnt
DISH_NETWORK
23 May 15 22:18:18
$2015 Ki BiG ID $All SatLite Update $New Channel $New Biss Key $ALL SiM Trix $MoBiLe Trix $C_LINE ON @DISHTRIXS_HD SND:40404
vanna$
23 May 15 22:09:41
the $C video @ovo_andreaa sent me 😭😂💀
eBook Deals
23 May 15 21:59:10
R Ed_Elissa $C>G FrpRy
#ARY News
23 May 15 21:39:08
$2015 Ki BiG ID $New SatLite $New ChaNneL $New BissKeY $C_Line Info $SiM Trix $mobile Trix $Live Cricket Follow @DISH_NEWS_3G SEND 40404
#MusSaWaR ..
23 May 15 21:38:48
$2015 Ki BiG ID $New SatLite $New ChaNneL $New BissKeY $C_Line Info $SiM Trix $mobile Trix $Live Cricket Follow @DISH_NEWS_3G SEND 40404
Firman Haji
23 May 15 21:09:43
Foto2 Mas, biar eksis :D RT @Spurs_ID Selamat pagi juga @arie_vanderlijn & teman2nya. :-) Udah siap uJgn lupa kirim2 foto wkt ntn ya. $C)YS
Neal
23 May 15 20:50:59
RT @seeitmarket: Are Bank Stocks Ready To Lead The Market Higher? http://t.co/Tf6wSOfqvw by @andrewnyquist $BKX $JPM $GS $WFC $C $BAC
Tottenham Hotspur
23 May 15 20:29:37
Selamat pagi juga @arie_vanderlijn & teman2nya. :-) Udah siap utk pertandingan nanti mlm kayanya nih. Jgn lupa kirim2 foto wkt ntn ya. $C)YS
sab_option1
23 May 15 20:15:36
B%5%6 %($N%a%m%j %s%-% e!$B%+%D%*!& quot;%K%e! < %/$GF2$ G$¥ $C$?$ j(Bt~ M a( B?!$B %^%9% *!& t;;% ]%C% $¥$ C$ ?$ j( 0xF3FE @spamattack_bot
Sam
23 May 15 19:59:07
Yawn. Getting late now! $INTC $MTW $CAT $X $C $CSCO $T $SE $WU $MU $WBA http://t.co/bh923uwZvq http://t.co/m02Z74Xg9T
royfberger
23 May 15 19:58:05
True balls. $AAPL $GOOG $INTC $MTW $CAT $X $C $CSCO $T $SE $WU $MU $WBA http://t.co/8mR4s0pUtT http://t.co/twxiVDvK6R
Capital Market Labs
23 May 15 19:23:14
Largest Banks Cash from Operations $BAP $C $JPM $BAC $BBT Chart: http://t.co/vyZq2562sX http://t.co/yCFNdOBcHq
Francisco de la Lama
23 May 15 19:23:09
RT @ProTradersNews: $IPO $ETSY $BOX $GDDY $EBAY $AMZN $LC $GOOGL $C $YHOO $T $DIS $.SPX: Why the hot IPO market is cooling off: http://t.…
SC_AOB
23 May 15 19:14:43
Check out "Game 4 sale (R.I.P. Mac Dre)" by $c - http://t.co/NaQnumtYQx #vote4sc #ripmacdre #macdre #sugafree #crazygame #salute #respect
SC_AOB
23 May 15 19:13:40
Check out "Knock em out the box" by $c - http://t.co/sioclMTbaz #slickrick #turnup #SaturdayMotivation #EurovisionSongContest #westcoast
SC_AOB
23 May 15 19:12:05
Check out "Gettiing This Doe" by $c - http://t.co/WvCav0VDUp #vote4sc #thinkinOutTheBoxAlbum #SaturdayMotivation
SC_AOB
23 May 15 19:11:07
Check out "Jus Another Day In South Central" by $c - http://t.co/WVopXylETU #vote4sc #westcoast #westcoastsongwriters #fridayflashback
Clayton R.
23 May 15 18:45:12
Wondering where to learn stock options? Here's the place http://t.co/gV3ZaHH3uy $F $GE $T $BAC $VZ $C $AA $JPM $KO $PFE #investing
Bshaum
23 May 15 17:57:00
RT @seeitmarket: Are Bank Stocks Ready To Lead The Market Higher? http://t.co/Tf6wSOfqvw by @andrewnyquist $BKX $JPM $GS $WFC $C $BAC
PAKSAT 1R.38.E
23 May 15 17:37:32
$2015 Ki BiG ID $All SatLite Update $New ChaNneL $New BissKeY $ALL SiM Trix $MoBiLe Trix $C_LINE ON @AsiaSat_3G ON @DiSHTRiXS_3G SND:40404
Breaking News Now
23 May 15 15:52:01
$C $FXCM: Citigroup to Sell Foreign-Exchange Accounts to Saxo Bank, FXCM: http://t.co/UQwhavv3IQ
SC_AOB
23 May 15 15:44:24
Check out $c - http://t.co/xPYhTW1pWr #vote4sc
FinSentS SP500
23 May 15 15:25:34
$C:US Energen PT Lowered to $80.00 at Citigroup Inc. (EGN) #CITIGROUP INC http://t.co/tjiCQXacW1 #SP500
Capital Market Labs
23 May 15 14:53:02
$FNMA vs. $WFC vs. $C vs. $JPM Compared Across 9 Critical Measures http://t.co/ZvuCYWWqGE http://t.co/ggMbfQ1JgT
NewsTalk
23 May 15 14:04:23
RT @ForexLive: $FXCM must be getting a sweet deal on the retail FX business of $C or they wouldn't be interested.
Breaking News Now
23 May 15 13:46:07
$C: Banks brace for more foreign exchange rigging pain as civil lawsuits ...: http://t.co/hVy5Dcl5YR
Penny Stockington
23 May 15 13:38:40
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVU6RRw $VRS $LAS $C $WFC
Stockaholics
23 May 15 13:36:52
Our Penny Stock Pick On $THCZ Is Up 570.77% For Platinum Members! Big Update: http://t.co/dXhKtfZvCq $VRS $LAS $C $WFC
Stock Rocket
23 May 15 13:28:29
Our Stock Alerts Gained Over 1300% In Less Than 3 Months! See Our New Picks: http://t.co/keLIhbtrUQ $BMSN $C $GE
StockenheimerSchmidt
23 May 15 13:26:53
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3E8vs2 $VRS $LAS $C $WFC
See It Market
23 May 15 12:23:49
Are Bank Stocks Ready To Lead The Market Higher? http://t.co/Tf6wSOfqvw by @andrewnyquist $BKX $JPM $GS $WFC $C $BAC
Penny Stockington
23 May 15 12:15:33
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVU6RRw $BMSN $C $GE
Stockaholics
23 May 15 12:09:36
Our Penny Stock Pick On $THCZ Is Up 570.77% For Platinum Members! Big Update: http://t.co/dXhKtfHUdQ $BMSN $C $GE
StockenheimerSchmidt
23 May 15 12:02:35
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3Eq6QC $BMSN $C $GE
				
				
By  +Follow June 24, 2013 11:37AM
Share:

Comments

 

blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.

Login or Register

LOG IN