Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?



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

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


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

Signup for our daily newsletter and get our best articles emailed right to you!

Results for c
30 Aug 15 00:46:51
$2015 Ki BiG ID $All SatLite Update $New Channel $New Biss Key $ALL SiM Trix $MoBiLe Trix $C_LINE ON @D2H_NETWORK ON @DTH_NETWORK SND:40404
30 Aug 15 00:42:58
stock_forums : NFLX Netflix, Inc. % Change http://t.co/uqtIhgps3Z $NFLX $CBIS $CWD.L $C… http://t.co/IThNjxLRYQ) http://t.co/mlb2HtBELg
30 Aug 15 00:08:03
$C is rated BUY, 23.7% upside by Wall Street analysts based on average ratings/targets http://t.co/o1CVWFdde9 http://t.co/izY5BPLMUa
Envestor First
29 Aug 15 23:16:44
"@OpenOutcrier $C Chief Economist Thinks Only "Helicopter Money" Can Save The World Now http://t.co/qMLXbiovGI"
29 Aug 15 23:12:08
$2015 Ki BiG ID $All SatLite Update $New Channel $New Biss Key $ALL SiM Trix $MoBiLe Trix $C_LINE ON @DISHTRIXS_HD SND:40404
Rosner Stocks
29 Aug 15 21:44:26
SCTY SolarCity Corp. Bid http://t.co/n2Tpo5LCX8 $SCTY $HYG $C $T #SCTY #stockmarket #finance
29 Aug 15 21:41:16
MANH Manhattan Associates, Inc. P/E Ratio http://t.co/NtoxzT7xOX $MANH $GE $C $INTC #MANH #share #stock
Open Outcrier
29 Aug 15 21:34:35
$C Chief Economist Thinks Only "Helicopter Money" Can Save The World Now http://t.co/XLdahjyZOU
29 Aug 15 21:33:11
C Citigroup, Inc. Current Price http://t.co/F4iPnn1oPA $C $UBT $GMCR $XEL #C #pennystocks #share
29 Aug 15 21:32:35
C Citigroup, Inc. Shares http://t.co/jlT4PTjQuR $C $ABX $EMES $BEAT #C #share #share
29 Aug 15 20:45:03
SMN Direxion Daily Semiconductor Bear 3x Shares Change http://t.co/TG1xyTFoPg $SMN $WOGI $CPG.TO $C #SMN #share #finance
Chris BlockZombie
29 Aug 15 20:32:08
RT @diegodaquilio: Here’s Where 6 Banking Giants Are Placing Their Bets On FinTech Startups $C $GS $MS $JPM $BAC $WFC http://t.co/6po9WX0HlA
29 Aug 15 19:36:08
RT @OphirGottlieb: $BAC vs. $C Head to Head http://t.co/2JWMc6vr7S http://t.co/tngKQ9fB1B
Investors Hangout
29 Aug 15 19:34:11
C Citigroup, Inc. Short Sales http://t.co/nbgLAwoWtU $C $SIRGQ $CXV.V $JDST #C #investing #pennystocks
29 Aug 15 19:33:07
BEN Franklin Resources, Inc. Prev Close http://t.co/oSBoNeCfxa $BEN $AMRN $EXPE $C #BEN #stockmarket #nasdaq
Consumer News
29 Aug 15 18:59:40
Citigroup Upgraded at Vetr Inc. $C http://t.co/FPG2QC5hZw #acn
François-Xavier Cat
29 Aug 15 18:51:29
RT @BrucePayette: #tinyposh class as schema class d {[int] $a; $b; [datetime] $c} $jd = ConvertFrom-Json '[{"a":123, "b":"hi", "c":"11/11/1…
29 Aug 15 18:47:34
INTC iShares Dow Jones U.S. Home Construction Current Price http://t.co/kQFzHcUQY1 $INTC $XIV $C $DAL #INTC #stocks #stocks
29 Aug 15 18:47:13
RDSH Roadships Holdings, Inc. Yield http://t.co/9prPFtOlfV $RDSH $BNP.TO $C $DUST #RDSH #nasdaq #invest
29 Aug 15 18:46:12
PIR PowerShares Dynamic Pharmaceuticals Portfolio Ask http://t.co/uQo75SojIP $PIR $TLT $C $MDY #PIR #stockmarket #finance
29 Aug 15 18:46:06
LVS Las Vegas Sands Corp. Tick http://t.co/5oVM8uW34R $LVS $C $DAG $DRI #LVS #stock #share
29 Aug 15 18:46:05
NFLX Netflix, Inc. Ask Size http://t.co/hFzuQyBn5k $NFLX $TWTR $SVXY $C #NFLX #pennystocks #investing
29 Aug 15 18:45:38
FBALX Fidelity Balanced Fund Financials http://t.co/G6ErfFFYyc $FBALX $C $XLI $GS #FBALX #tradeideas #nasdaq
Investors Hangout
29 Aug 15 18:39:05
EUM ProShares Short MSCI Emerging Markets Current Price http://t.co/QTg7DtbrLB $EUM $C $BAM/A.TO $SPXS #EUM #finance #stockmarket
29 Aug 15 18:35:28
C Citigroup, Inc. Prev Close http://t.co/V7c2JqEHsH $C $DDM $BP $CSCO #C #share #stocks
Investors Hangout
29 Aug 15 18:35:28
C Citigroup, Inc. Tick http://t.co/6sQnlmr8f2 $C $VXX $FNMA $GDX #C #finance #stockmarket
29 Aug 15 18:35:26
CELG Celgene Corp. Change http://t.co/5xGsMFfAKK $CELG $CRUS $CG.TO $C #CELG #pennystocks #pennystocks
29 Aug 15 18:35:26
BIB ProShares Ultra NASDAQ Biotechnology E.P.S. http://t.co/RO1NrIOrC7 $BIB $C $ADT $HYG #BIB #share #finance
29 Aug 15 18:35:25
CLX Clorox Co. Exchange http://t.co/9MRFTD0mJm $CLX $SKX $C $EA #CLX #nasdaq #tradeideas
Stock Forums
29 Aug 15 18:35:25
C Citigroup, Inc. Investor Opinions http://t.co/yDHdXAsjCe $C $RCL $IWM $DIG #C #invest #stock
Lucky Jimmy
29 Aug 15 18:35:22
C Citigroup, Inc. Volume http://t.co/ZGCSHkaTBv $C $EUM $XIV $TWTR #C #nasdaq #investing
29 Aug 15 18:35:14
C Citigroup, Inc. Chart http://t.co/JKWI5gXVPF $C $GOOGL $DDM $PEP #C #share #share
29 Aug 15 18:35:12
C Citigroup, Inc. Open http://t.co/JB46Y1BlmW $C $UWTI $CVS $ABT #C #nasdaq #invest
29 Aug 15 18:33:39
C Citigroup, Inc. Ex-Div Date http://t.co/LDX9YEyuC9 $C $ABT $ITB $AXP #C #invest #tradeideas
29 Aug 15 18:33:39
C Citigroup, Inc. Ex-Div Date http://t.co/4fN2yeEPCu $C $GS $PJP $ACI #C #pennystocks #nasdaq
29 Aug 15 18:32:33
ACI Arch Coal, Inc. Day Low http://t.co/0Qc8bysQiF $ACI $DRI $HOU.TO $C #ACI #share #stockmarket
29 Aug 15 18:32:12
ADT ADT Corp. Ask http://t.co/oQVw0ibXAD $ADT $AAPL $C $JNJ #ADT #stocks #stock
29 Aug 15 18:32:11
ACHC Acadia Healthcare Company, Inc. Stock Forum http://t.co/g2R466W6Ju $ACHC $SMN $JNUG $C #ACHC #stocks #pennystocks
29 Aug 15 18:15:37
B%5%6 %($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
29 Aug 15 18:11:17
$2015 Ki BiG ID $All SatLite Update $New Channel $New Biss Key $ALL SiM Trix $MoBiLe Trix $C_LINE ON @D2H_NETWORK ON @DTH_NETWORK SND:40404
Glenn Sizemore
29 Aug 15 17:34:16
RT @BrucePayette: #tinyposh class as schema class d {[int] $a; $b; [datetime] $c} $jd = ConvertFrom-Json '[{"a":123, "b":"hi", "c":"11/11/1…
Capital Market Labs
29 Aug 15 17:27:50
9 Large Cap Banks with Great Fundamentals and Golden Cross $WFC $C $USB http://t.co/uvZFMXxtWE http://t.co/35NrtVD2Wx
Bruce Payette
29 Aug 15 17:12:46
#tinyposh class as schema class d {[int] $a; $b; [datetime] $c} $jd = ConvertFrom-Json '[{"a":123, "b":"hi", "c":"11/11/11"}]' [d[]] $jd
Capital Market Labs
29 Aug 15 16:47:47
$C High Fundamental Rating -> http://t.co/XXHVSFvFRz http://t.co/2mbJxxaF83
Capital Market Labs
29 Aug 15 16:47:44
$C High Fundamental Rating http://t.co/28nLXDhVTw http://t.co/bAJWv4MTI3
Jay ➰
29 Aug 15 16:44:35
Add me on $c: Dreaddddd 👸🏽✨
29 Aug 15 16:41:29
RT @theflynews: Analysts issue positive notes for 32 notable companies, including $C $ANF and $LOCO. Our full list: http://t.co/2vhh9KGjDL
29 Aug 15 16:38:07
chartguy89: 2015 Trending Stocks: C -0.30% Stock Charts $C Citigroup Inc. (NYSE) http://t.co/dkQ7Kfu8Gr
Capital Market Labs
29 Aug 15 16:35:46
Interactive Chart -> http://t.co/BPWLHF2Rtl $C Bad Loans are Declining. http://t.co/9sNGCVY42m
29 Aug 15 16:32:49
C -0.30% Stock Charts $C Citigroup Inc. (NYSE) Last Updated: 08/29/2015 18:32:54 C Stock Chart - 1 Month http: http://t.co/FAsaD3lWPM
By  +Follow June 24, 2013 11:37AM



blog comments powered by Disqus

 Today's Must Reads

Welcome to Equities.com's Small-Cap Throwdown

These Analysts Called Apple's (AAPL) Collapse, Here's What They're Saying Now

7 Dow Stocks Worth Owning and a Lot that Aren't

Sprint Turnaround Has Begun

Saving the

Small-Cap Market


Small-cap stocks offer investors many benefits, ranging from higher growth potential to overlooked value opportuni... in Equities.com's Hangs on LockerDome

About us

Equities.com is an advanced financial data portal and social network designed to connect self-directed investors with the world’s most innovative startup and small cap companies. Through our in-depth coverage of small cap markets, comprehensive research and stock valuation reports, state of the art issuer products, and world class events, Equities.com provides the social tools and insight that drive tomorrow’s investment relationships and opportunities.

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

Login or Register