Citibank

by Kartini Saparudin

Citibank is one of the major and earliest financial institutions in Singapore that is still in operation today. 

Founding
City Bank of New York was founded in New York in 1812. In 1865 it was chartered under the National Bank Act and renamed the National City Bank of New York.1 The bank was renamed Citibank, NA (National Association) in 1976.2


In 1902, the International Banking Corporation (IBC) became the first American bank to establish a branch in Singapore. It signalled the importance of Singapore to the American rubber industry.3 IBC was purchased by National City Bank of New York in 1915.4

The Singapore branch of IBC focused on financing the export of tin and rubber from the Malayan hinterland, although there was severe competition from British, French, Japanese, Dutch and other American banks later on.5


Early system
By the late 19th and 20th centuries, each branch in Asia had its own comprador, who acted as a highly trusted intermediary between the bank and the local businesses. The comprador usually had a good amount of collateral that he could pledge to attract clients to the bank, and he made his earnings through commission. The comprador was also in charge of the cash department and tellers in the branches, checking against fraud and losses. As a result, most people working in the cash department were either related or loyal to the comprador. This would never have been permitted in banks in America. However, the practice was tolerated here because the system brought in native clients and provided stability and continuity in the bank. Song Kim Pong was the first Singaporean comprador for IBC. He worked as an assistant cashier for 16 years in another bank before his appointment in IBC in 1902.6  


1930s
During the 1930s, when foreign exchange trading and trade financing were the main forms of transaction in banks, the Singapore branch of IBC was rather unusual in its earnings. The branch’s profits were primarily from ordinary lending instead of foreign exchange and trade financing. At the time, IBC was lending huge sums of money to local rubber companies, and to manufacturers such as Firestone and Goodyear. The loans were so huge that the branch inevitably faced problems when the world economy and rubber prices collapsed in the early 1930s. Ralph Newell, who spent 36 years with IBC in Asia, was transferred to Singapore to clean up the mess. Ho Kim Seng, a local who was hired through a local recruitment drive, later succeeded him. Through this move, IBC hoped to improve the relationship between the business community and the local government amidst a wave of anti-foreign and nationalistic sentiments that were sweeping across Asia in the ’30s.7


1940s
By the end of 1941 many of the bank’s remaining branches in Asia were in the hands of the Japanese. Right up to their last days, the IBC branches were obliged to remain open as they were the official bank for the American government in those cities. The Singapore branch was working day and night to help finance the United States government in their last-minute purchases of tin and rubber. Even as the Japanese crossed the Causeway, the Singapore branch was still in operation. George Magruder, a sub-accountant at IBC, recalled that he was left behind to clear the settlements while the rest of the staff left on a boat for India. On 5 February 1942, when the Japanese invaded Singapore, the Singapore branch handed over the remaining items on its balance sheet to a British bank.The Singapore branch was said to be the only institution that got out of Singapore without any loss of funds and personnel.


Postwar decades and the present
The bank resumed operations in mid-1945. However, postwar activities for the bank were less dynamic and remained stagnant for the next 10 to 15 years. Things picked up for the bank in the 1970s when Singapore actively promoted the establishment of manufacturing companies. During this period, finance and consumer services became part of its core business. Consumer services continues to be the driving force behind the bank’s operations in Asia.10


The rising affluence of consumers in the last 20 years has created new opportunities for Citibank in Singapore and Asia. Citibank established the Consumer Bank in 1982 to cater to the needs of individuals and small businesses. Today, Citibank provides a complete range of financial services to its customers.11



Author
Kartini Saparudin




References
1. Encyclopaedia Britannica, Inc. Citigroup. Retrieved 2021, January 22 from Encyclopaedia Britannica website: https://www.britannica.com/topic/Citigroup
2. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, p. 13. (Call no.: RSING q332.12095957 STA)
3. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, pp. 20, 29–30, 35. (Call no.: RSING q332.12095957 STA); Baker, J. (2005). The eagle in the lion city: America, Americans and Singapore. Singapore: Landmark Books, p. 95. (Call no.: RSING 303.4825957073 BAK)
4. Encyclopaedia Britannica, Inc. Citigroup. Retrieved 2021, January 22 from Encyclopaedia Britannica website: https://www.britannica.com/topic/Citigroup
5. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, p. 39. (Call no.: RSING q332.12095957 STA)
6. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, pp. 32–33. (Call no.: RSING q332.12095957 STA)
7. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, pp. 55–56. (Call no.: RSING q332.12095957 STA)
8. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, pp. 68, 70, 72. (Call no.: RSING q332.12095957 STA)
9. Baker, J. (2005). The eagle in the lion city: America, Americans and Singapore. Singapore: Landmark Books, p. 180. (Call no.: RSING 303.4825957073 BAK)
10. Starr, P. (2002). Citibank: A century in Asia. Singapore: Editions Didier Millet, pp. 87–88, 114. (Call no.: RSING q332.12095957 STA)
11. Citigroup, Inc. (2016). History of Citibank in Singapore. Retrieved 2017, January 31 from Citibank website: https://www.citibank.com.sg/gcb/static/ab_hcs.htm



The information in this article is valid as at 2021 and correct as far as we can ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.

 

Subject
Banks and banking--Singapore
Business enterprises

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