Citigroup Inc.

FORWARD-LOOKING STATEMENTSCertain statements in this Form 10-K, including but not limited to statementsincluded within the Management’s Discussion and Analysis of FinancialCondition and Results of Operations, are “forward-looking statements”within the meaning of the rules and regulations of the SEC. Generally,forward-looking statements are not based on historical facts but insteadrepresent only Citigroup’s and management's beliefs regarding futureevents. Such statements may be identified by words such as believe, expect,anticipate, intend, estimate, may increase, may fluctuate, and similarexpressions, or future or conditional verbs such as will, should, wouldand could.Such statements are based on management's current expectations andare subject to uncertainty and changes in circumstances. Actual results maydiffer materially from those included in these statements due to a variety offactors, including without limitation the precautionary statements includedin this Form 10-K, the factors listed and described under “Risk Factors”above, and the factors described below:• the impact of the ongoing implementation of the Dodd-Frank Wall StreetReform and Consumer Protection Act of 2010 (Financial Reform Act)on Citi’s business activities and practices, costs of operations and overallresults of operations;• the impact of increases in FDIC insurance premiums on Citi’s earningsand competitive position, in the U.S. and globally;• Citi’s ability to maintain, or the increased cost of maintaining, adequatecapital in light of changing regulatory capital requirements pursuantto the Financial Reform Act, the capital standards adopted by the BaselCommittee on Banking Supervision (including as implemented by U.S.regulators) or otherwise;• disruption to, and potential adverse impact to the results of operations of,certain areas of Citi’s derivatives business structures and practices as resultof the central clearing, exchange trading and “push-out” provisions ofthe Financial Reform Act;• the potential negative impacts to Citi of regulatory requirements aimedat facilitation of the orderly resolution of large financial institutions, asrequired under the Financial Reform Act;• risks arising from Citi’s extensive operations outside the U.S., includingcompliance with conflicting or inconsistent regulations and Citi’s abilityto continue to compete effectively with competitors who may face fewerregulatory constraints;• the impact of recently enacted and potential future regulations on Citi’sability and costs to participate in securitization transactions;• a reduction in Citi’s or its subsidiaries’ credit ratings, including inresponse to the passage of the Financial Reform Act, and the potentialimpact on Citi’s funding and liquidity, borrowing costs and access to thecapital markets, among other factors;• the impact of restrictions imposed on proprietary trading and fundsrelatedactivities by the Financial Reform Act, including the potentialnegative impact on Citi’s market-making activities and its globalcompetitive position with respect to its trading activities;• increased compliance costs and possible changes to Citi’s practices andoperations with respect to a number of its U.S. Consumer businesses asa result of the Financial Reform Act and the establishment of the newBureau of Consumer Financial Protection;• the continued impact of The Credit Card Accountability Responsibility andDisclosure Act of 2009 as well as other regulatory requirements on Citi’scredit card businesses and business models;• the exposure of Citi, as originator of residential mortgage loans, sponsorof residential mortgage-backed securitization transactions or servicer ofsuch loans, or in such transactions, or in other capacities, to governmentsponsored enterprises (GSEs), investors, mortgage insurers, or other thirdparties as a result of representations and warranties made in connectionwith the transfer or securitization of such loans;• the outcome of inquiries and proceedings by governmental entities, orjudicial and regulatory decisions, regarding practices in the residentialmortgage industry, including among other things the processes followedfor foreclosing residential mortgages and mortgage transfer andsecuritization processes, and any potential impact on Citi’s foreclosuresin process;• the continued uncertainty about the sustainability and pace of theeconomic recovery, including continued disruption in the global financialmarkets and the potential impact on consumer credit, on Citi’s businessesand results of operations;• Citi’s ability to maintain adequate liquidity in light of changing liquiditystandards in the U.S. or abroad, and the impact of maintaining adequateliquidity on Citi’s net interest margin (NIM);144