Banking Interpretations
June 14, 2004
Andrew W. Alter, Esq.
Managing Director & Counsel
Capital Markets Legal
Salomon Smith Barney Inc.
388 Greenwich Street, 20th Floor
New York, NY 10013
Re: Clarification of Letter Dated March 4, 2002
Dear Mr. Alter:
This letter is to amend and clarify the above-referenced letter that was issued in response to your letter of December 21, 2001, as clarified by your letter of February 20, 2002, to former Superintendent of Banks McCaul with respect to the plans of Citigroup Inc. ("Citigroup") to introduce a new brand name, "Citigroup Corporate & Investment Bank". The proposed new brand name was to be used by various Citigroup subsidiaries that provide corporate finance, corporate banking, investment banking and broker/dealer services to corporate and institutional customers. The new brand was to be used alongside the respective corporate name of the existing entity and used on advertising and print materials.
Sections 132 and 669 of the Banking Law contain provisions which prohibit the use by unauthorized persons of any signs or words that indicate that the business of a bank or trust company is being conducted by a firm that is not a duly chartered banking organization. The Attorney General of the State of New York also has issued an opinion dated October 19, 1967, which indicates that the use of the phrase "investment banker" or “investment banking" by a corporation involved in the underwriting and dealing in corporate securities is not prohibited by the Banking Law.
Citigroup contemplated that the subsidiaries in question would provide services to their corporate and institutional clients relating, but not limited, to such areas as investment banking, broker-dealer, foreign exchange, leasing, corporate lending, swaps and derivatives. With regard to these activities, while there is no direct prohibition in the Banking Law to the use of the term “bank”, when such name is not intended to give the impression that a banking business is conducted by such subsidiaries, the Banking Department has determined upon reconsideration that the Attorney General’s opinion makes clear that with respect to securities underwriting and dealing activities the words “investment” and “bank”, or any derivation thereof, must be used together in order for such usage not to be prohibited by the Banking Law. Thus, based on the facts presented, the Banking Department would interpose no objection to subsidiaries affiliated with Citigroup using the brand name “Citigroup Corporate & Investment Bank”. We note, however, that this approval is specifically limited to the use of the name Citigroup Corporate & Investment Bank. Should Citigroup contemplate using any other brand name, we strongly recommend that the prior approval of the Banking Department be obtained.
I trust the foregoing is responsive to your question. Should you have any further questions, please feel free to contact me directly at (212) 709-1649.
Sincerely yours,
Jay Kane
Assistant Counsel
cc: William Sweet, Esq.