The core business in Ireland of Citigroup, the world's biggest financial services group, is predicting growth of 15 per cent this year after pretax profits of €187.81 million for 2004.
The unit reported a profit before tax of €95.9 million in 2003. The growth last year, which follows the introduction of several new products for business customers, does not reflect an increase in like-for-like activity.
Citigroup was one of the first international institutions to establish a base in Ireland, more than 30 years ago.
The group's chief executive in Ireland, Aidan Brady, said its global transaction services (GTS) unit here represented about 80 per cent of the bank's activities in Dublin and some 90 per cent of profits.
On that basis, Citigroup's profits from all its Irish operations were in the region of €210 million last year.
In addition to the GTS business, which employs 1,000 people, the bank employs 200 staff in other operations, mainly in capital markets trading and in a start-up life assurance business that targets the British market.
The Dublin office is the international headquarters for 10 of the product services sold by GTS, one of the biggest divisions in Citigroup. This operation carries out transactions in 137 currencies and has clients in 108 countries, doing business in 200 countries.
Products include cash management services, funds transfer and treasury outsourcing. Recently filed accounts for Citibank Ireland Financial Services, the wholly-owned subsidiary which carries out this business, show it collected €276.25 million in fees and commissions in 2004, up from €142.83 million in 2003.
With an overall operating income of €301.04 million, the company paid out €80.2 million in administrative expenses last year. The unit, which paid taxes of €19.64 million in 2004, had retained profits of €289 million at the end of the year.
"The business is doing very well and the normal growth rate of 15 per cent in GTS is coming through here," Mr Brady said.
The 10 directors on the board of the Citibank Ireland Financial Services received remuneration and fees totalling €1.59 million last year, according to the accounts. Former Central Bank governor Maurice Doyle and the former head of Intel's Irish unit, Frank McCabe, are non-executive directors.
No dividends were paid from the unit to Citigroup's parent in the US last year or in 2003. As the GTS business in Ireland is still in a development phase, the operation is not likely to pay a dividend in respect of its profits this year.
It emerged earlier this week that Citigroup had appointed James Wolfensohn, former head of the World Bank and current international Middle East envoy, as a senior adviser. Mr Wolfensohn, who stepped down from the bank in May after 10 years as president, will advise management on global strategy and work with international clients.
