Strategy Analysis

Analysis of Citigroup in China

Learning Team C

Strategy Formulation and Implementation Mgt/578

February 11, 2005

Executive Summary

Citigroup has a long history in China, first establishing an office in Shanghai on May 15, 1902. Today Citigroup's China operation serves a diverse base of customers including multinationals, joint ventures, local enterprises and individuals. Its business by products covers a wide spectrum of merchant banking, commercial, and consumer activities. Citigroup operates branches in five major cities: Beijing; Shanghai Pudong; Guangzhou; Shenzhen; and Tianjin, and will open in Chengdu in late October. Citigroup also has nine sub-branches serving consumers and a representative branch in Xiamen.

This paper will display the positive aspects of Citigroup's adaptability in expanding operations in China versus the negative aspects of the adaptability in its attempt to expand operations in China.

Positive Analysis

Citigroup became the first foreign institution to receive a license to operate in China. China's officials believe that by allow a foreign company to expand in China it will force the local institutions to be more competitive and expand their operations also. Citigroup remains committed to bringing the best banking services available to its customers in China. With its strong dedication to the Chinese market, Citigroup is an important player in the Chinese banking industry and will continue to expand its presence there in a manner that generates tangible and significant benefits for Chinese consumers, Chinese companies, and indeed the Chinese banking sector itself.

Citigroup has displayed flexibility in its attempt to expand by working with local Chine's institutions and government officials as well as the World Trade Organization. They created