UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2015 Commission file number 1-9924 Citigroup Inc. (Exact name of registrant as specified in its charter) Delaware 52-1568099 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 399 Park Avenue, New York, NY 10022 (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 No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No Number of shares of Citigroup Inc. common stock outstanding on June 30, 2015: 3,009,845,273 Available on the web at www.citigroup.com CITIGROUP INC SECOND QUARTER 2015—FORM 10-Q OVERVIEW 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 4 Executive Summary 4 Summary of Selected Financial Data 7 SEGMENT AND BUSINESS—INCOME (LOSS) AND REVENUES 9 CITICORP 12 Global Consumer Banking (GCB) 13 North America GCB 15 Latin America GCB 17 Asia GCB 19 Institutional Clients Group 21 Corporate/Other 25 CITI HOLDINGS 26 BALANCE SHEET REVIEW 28 OFF-BALANCE SHEET ARRANGEMENTS 31 CAPITAL RESOURCES 32 Overview Capital Management Current Regulatory Capital Standards Basel III (Full Implementation) Regulatory Capital Standards Developments Tangible Common Equity, Tangible Book Value Per Share and Book Value Per Share Managing Global Risk Table of Contents— Credit, Market (Including Funding and Liquidity), and Country and Cross-Border Risk Sections 51 MANAGING GLOBAL RISK 52 INCOME TAXES 95 DISCLOSURE CONTROLS AND PROCEDURES 96 DISCLOSURE PURSUANT TO SECTION 219 OF THE IRAN THREAT REDUCTION AND SYRIA HUMAN RIGHTS ACT 96 FORWARD-LOOKING STATEMENTS 97 FINANCIAL STATEMENTS AND NOTES TABLE OF CONTENTS 100 CONSOLIDATED FINANCIAL STATEMENTS 101 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 110 Legal Proceedings (See Note 25 to the Consolidated Financial Statements) UNREGISTERED SALES OF EQUITY, PURCHASES OF EQUITY SECURITIES, DIVIDENDS 237 1 OVERVIEW This Quarterly Report on Form 10-Q should be read in conjunction with Citigroup’s Annual Report on Form 10-K for the year ended December 31, 2014 filed with the U.S. Securities and Exchange Commission (SEC) on February 25, 2015, including the historical audited consolidated financial statements of Citigroup reflecting the adoption of an accounting change (See Note 1 to the Consolidated Financial Statements) and certain realignments and reclassifications set forth in Citigroup’s Current Report on Form 8-K filed with the SEC on May 27, 2015 (2014 Annual Report on Form 10-K), and Citigroup’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 filed with the SEC on May 11, 2015 (First Quarter of 2015 Form 10-Q). Additional information about Citigroup is available on Citi’s website at www.citigroup.com. Citigroup’s recent annual reports on Form 10-K, quarterly reports on Form 10-Q, proxy statements, as well as other filings with the SEC, are available free of charge through Citi’s website by clicking on the “Investors” page and selecting “All SEC Filings.” The SEC’s website also contains current reports, information statements, and other information regarding Citi at www.sec.gov. Certain other reclassifications, have been made to the prior periods’ presentation. Throughout this report, “Citigroup,” “Citi” and “the Company” refer to Citigroup Inc. and its consolidated subsidiaries. 2 Citigroup is managed pursuant to the following segments: (1) For reporting purposes, Asia GCB includes the results of operations of EMEA GCB for all periods presented. Note: Reflects recent business reclassifications. See “Overview” above for additional information. The following are the four regions in which Citigroup operates. The regional results are fully reflected in the segment results above. 3 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS EXECUTIVE SUMMARY consisted of $3.7 billion of legal expenses and a $55 million loan loss reserve build ($3.7 billion after-tax), to settle legacy Second Quarter of 2015—Continued Progress on RMBS and CDO-related claims, recorded in Citi Holdings. Execution Priorities Excluding these items, Citi reported net income of $4.7 Citi’s second quarter of 2015 reflected solid overall results and billion in the second quarter of 2015, or $1.45 per diluted steady progress on its execution priorities, including: share, compared to $3.9 billion, or $1.24 per share, in the prior-year period. The 18% increase from the prior-year period • Efficient resource allocation and disciplined expense was primarily driven by lower expenses, lower net credit management: Citi maintained disciplined expense losses and a lower effective tax rate (for additional management during the second quarter of 2015, even as it information, see “Income Taxes” below), partially offset by absorbed increased regulatory and compliance costs in lower revenues and a reduced net loan loss reserve release. Citicorp. Citi’s expense management in the current (Citi’s results of operations excluding the impacts of CVA/ quarter was further aided by lower legal and related DVA and the mortgage settlement are non-GAAP financial expenses and lower repositioning expenses in Citicorp as measures.) compared to the prior-year period, as discussed further Citi’s revenues, net of interest expense, were $19.5 billion below. in the second quarter of 2015, approximately unchanged • Continued wind down of Citi Holdings, while maintaining versus the prior-year period. Excluding CVA/DVA, revenues profitability: Citi continued to wind down Citi Holdings, were $19.2 billion, down 2% from the prior-year period, as including reducing its assets by $32 billion, or 22%, from Citicorp revenues were approximately unchanged and Citi the prior-year period. In addition, as previously Holdings revenues decreased 16%. Excluding CVA/DVA and announced, Citi currently has executed agreements to sell the impact of foreign exchange translation into U.S. dollars for approximately $32 billion of the remaining assets in Citi reporting purposes (FX translation), Citigroup revenues Holdings, including OneMain Financial, the largest increased 3% from the prior-year period, as 5% growth in business remaining in Citi Holdings, subject to regulatory Citicorp revenues was partially offset by the decrease in Citi approvals and other closing conditions. As discussed Holdings revenues. (Citi’s results of operations excluding the further below, Citi Holdings also maintained profitability impact of FX translation are non-GAAP financial measures.) in the second quarter of 2015. • Utilization of deferred tax assets (DTAs): Citi utilized Expenses approximately $1.5 billion in DTAs during the first half of Citigroup expenses decreased 30% versus the second quarter 2015, including approximately $300 million during the of 2014 to $10.9 billion. Excluding the impact of the second quarter of 2015 (for additional information, see mortgage settlement in the prior-year period, expenses fell 7%, “Income Taxes” below). mainly driven by lower legal and related expenses ($360 million compared to $402 million in the prior-year period) and While continuing to make progress on these initiatives in repositioning costs ($61 million compared to $397 million in the first half of 2015, Citi expects the operating environment the prior-year period), as well as the impact of FX translation during the remainder of 2015 to remain challenging. Overall, (which lowered expenses by approximately $681 million in economic growth remains uneven across the developed and the second quarter of 2015 compared to the prior-year period). emerging markets and uncertainty continues as to when Excluding the impact of FX translation, Citigroup’s expenses interest rates may begin to rise. For more information on these declined 1%, mainly driven by the lower legal and related and other trends and risks that could impact Citi’s businesses, expenses and repositioning costs. results of operations and financial condition, see the Excluding the impact of FX translation, which lowered discussion of each businesses’ results of operations, “Forward- reported expenses by approximately $609 million in the Looking