What are Britons doing patronizing a New York bank?
Question: What's the fifth-largest bank in Great Britain? Answer: New York's Citicorp.
The largest banking company in the world, with about $160 billion in assets, Citicorp is famous in banking circles for its aggressiveness. Here in London, Citicorp's expansionary moves have grabbed the headlines in the financial press several times in the past year.
London has long opened its doors to foreign banks. There are some 450 of them rattling about this city, often competing for the same business in a relatively unregulated atmosphere. Citicorp has been represented here since 1902.
But Citicorp (a bank holding company that owns Citibank and other subsidiaries) stands out because of its wide retail and commercial banking presence in Britain. It is not big enough to challenge such British banking giants as Barclays or National Westminster in terms of market share. But with its 2,500 employees and probably more than $10 billion in assets in the United Kingdom, it causes anxiety at the No. 3 and 4 among British banks, Lloyds and Midland.
``Our aspiration is to be a major player here -- whether we are fifth, sixth, or seventh,'' says Kent de M. Price, senior vice-president in charge of Citicorp's various operations in the U.K.
So far, Mr. Price noted in an interview here, the American ownership of Citicorp ``hasn't seemed to be an issue'' in this country. The government has recognized that for London to remain a world financial center, it must welcome foreign banks at least relatively warmly.
Mr. Price speaks of the ``liberal tradition'' of the Bank of England, which regulates the banking industry here.
Other countries, recognizing the advantages of giving their corporations easier access to capital, have liberalized their financial markets. That's the case in West Germany, France, Australia, New Zealand, and Canada.
``It is getting through even the thickest heads that if [a nation] protects its financial services market, it becomes a weakness,'' Price asserts.
Here in Britain, Citicorp has more freedom to conduct other financial activities besides pure banking than it has in the United States. It is active in stockbroking, underwriting, life insurance, and insurance brokering, all areas where it faces statutory limitations in the US. Moreover, the British operation is profitable.
Price figures Citicorp can gather some ``experience and lessons'' in Britain that it will be able to use in the US as regulations ease there.