Citigroup is trying to reassure its clients on the China mainland that the bank is not in trouble as its China chairman said the lender has a strong balance sheet in a letter on its Website.

Andrew Au, chairman and chief executive officer of Citibank (China) Co Ltd, said: "rest assured that your deposits are safe with us," according to an open letter posted on its Chinese Website yesterday.

"In China, our loans to deposit ratio remains well under the 75 percent regulatory limit required, reflecting our strong emphasis on liquidity management," he said.

The bank is among the few banks, including HSBC, to have said it meets the requirement. Locally incorporated overseas banks on the mainland were given until 2012 to meet the limit after they received regulatory approval in 2007.

Domestic banks must meet the requirement.

"The safety of your deposits with any bank is not dependent on its stock price," Au said.

The bank is confident it can weather the difficult times by maintaining its financial strength.

Citibank (China) posted the letter after the United States government stepped in to pump US$20 billion into its US parent and guaranteed hundreds of billions of dollars in risky assets. The bank's shares had fallen sharply even though it claims no liquidity problems. Two years ago, its shares were at US$54. Citibank closed at US$5.94 yesterday.

The New York-based bank has taken significant asset write-downs, but has also increased its capital by US$85 billion, the letter said. The bank's tier 1 capital adequacy ratio is about 10.4 percent on a group view.

Citibank (China), the local incorporation of Citibank on the mainland, is regulated by the China Banking Regulatory Commission. Its capital adequacy ratio remains well above the regulatory requirement in China, the bank said.

"Citi has been in China since 1902, and today China remains one of Citi's top priorities, within the region and globally," he said.

Citigroup, one of the biggest foreign banks on the mainland, has more than 30 outlets in the country. The bank holds a 3.78 percent stake in Shanghai Pudong Development Bank Co and a 20 percent stake in Guangdong Development Bank.

(Shanghai Daily November 25, 2008)