financial reports - citigroup.com · mr. michael murray-bruce has an indirect shareholding through...

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FINANCIAL REPORTS

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DIRECTORS, OFFICERS AND ADVISORS

DIRECTORS

MrOlayemiCardoso Chairman

MrOmarHafeez ManagingDirector

MrAkinsowonDawodu ExecutiveDirector

MrFataiKarim ExecutiveDirector

MrTariqMasaud ExecutiveDirector

MrsFunmiOgunlesi ExecutiveDirector

MrAdeAyeyemi NonExecutiveDirector

MrMichaelMurray-Bruce NonExecutiveDirector

DrHilaryOnyiuke NonExecutiveDirector

MrKhalidQurashi NonExecutiveDirector

ChiefArthurMbanefoCON IndependentDirector

Prof.YemiOsinbajoSAN IndependentDirector

MrsOlusolaFagbure CompanySecretary

CORPORATE HEAD OFFICE

CitibankNigeriaLimited

CharlesS.SankeyHouse

27,KofoAbayomiStreet

VictoriaIsland,Lagos.

Telephone: +234012798400

+234014638400

Website: www.citigroup.com/nigeria

AUDITORS

PricewaterhouseCoopers

252E,MuriOkunolaStreet,

VictoriaIsland,Lagos

Telephone: +234(1)2711700

Website: www.pwc.com/ng

EngagementPartner:PatrickObianwa

FRCno.:FRC/2013/ICAN/00000000880

DIRECTORS’ REPORTFOR THE YEAR ENDED 31 DECEMBER 2013

ThedirectorshavepleasureinpresentingtheirannualreportontheaffairsofCitibankNigeriaLimitedanditssubsidiaries

(“theGroup”)togetherwiththefinancialstatementsandauditors’reportfortheyearended31December2013.

LEGAL FORM

TheBankwasincorporatedinNigeriaundertheCompaniesActasaprivatelimitedliabilitycompanyon2May1984.Itwas

grantedalicenseon14September1984tocarryonthebusinessofcommercialbankingandcommencedbusinesson14

September1984.

PRINCIPAL ACTIVITY AND BUSINESS REVIEW

TheprincipalactivityoftheGroupistheprovisionofcommercialbankingservicestoitscustomers.Suchservicesinclude

transactionalservices,corporatefinance,provisionoffinance,custodialbusinessandmoneymarketandtradingactivities.

TheBankhasasubsidiary,NigeriaInternationalBankNomineesLimited.Thecompanyisanomineecompanythatactsas

theregisteredholderofsecuritiespurchasedforcustomersoftheBank’sCustodialbusiness.

OPERATING RESULTS

TheNetoperatingincomeincreasedby1%andprofitbeforetaxoftheGroupalsoincreasedmarginallyoverprioryear.The

directorsrecommendtheapprovalofafinaldividendofN11,733,864,361.80(N4.20kpershare)(2012:N11,035,420,054.55

(N3.95kpershare))fromtheoutstandingbalanceintheretainedearningsaccountasat31December2013.Thedividends

aresubjecttodeductionofwithholdingtaxof10%.ThereisnofurtherpotentialtaxontheGrouparisingfrompaymentof

dividends.

HighlightsoftheGroup’soperatingresultsfortheyearunderreviewareasfollows:

2013 2012

N’000 N’000

NetoperatingIncome 28,573,453 28,157,312

Profitbeforetax 16,910,222 16,899,258

Incometaxexpense (3,267,092) (3,874,866)

Profitfortheyear 13,643,130 13,024,392

Othercomprehensiveincomefortheyear,netoftax (1,858,058) 4,788,575

Totalcomprehensiveincomefortheyear 11,785,072 17,812,967

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DIRECTORS’ SHAREHOLDING

ThefollowingdirectorsoftheBankheldofficeduringtheyearandhaddirectandindirectinterestsintheissuedsharecapital

of theBankasrecorded in theregisterofdirectors’shareholdingand/orasnotifiedbythedirectors for thepurposesof

sections275and276oftheCompaniesandAlliedMattersAct,asnotedbelow:

Direct Shareholding

Director Position Date of appointment/ Number of Number of

Resignation Ordinary Shares Ordinary Shares

held held

in 2013 in 2012

1.Mr.OlayemiCardoso Chairman - -

2.Mr.OmarHafeez

(Pakistani) ManagingDirector - -

3.Mr.Akinsowon

Dawodu ExecutiveDirector Appointed-July25,2013 - -

4.Mr.FataiKarim ExecutiveDirector - -

5.Mr.TariqMasaud

(Pakistani) ExecutiveDirector - -

6.Mrs.FunmiOgunlesi ExecutiveDirector - -

7.Mr.AdeAyeyemi NonExecutiveDirector - -

8.Mr.Michael

Murray-Bruce NonExecutiveDirector - -

9.Dr.HilaryOnyiuke NonExecutiveDirector - -

10.Mr.KhalidQurashi

(British) NonExecutiveDirector - -

11.Mr.NaveedRiaz

(American) NonExecutiveDirector Resigned-October4,2013 - -

12.ChiefArthurMbanefo

CON IndependentDirector - -

13.Prof.YemiOsinbajo

SAN IndependentDirector - -

Dr.HilaryOnyiukehasanindirectshareholdingthroughGauthierInvestmentsLtdwhichhasashareholdingof33,445,769

ordinaryshares.

Mr.OlayemiCardosohasanindirectshareholdingthroughtheEstateofF.B.Cardosowhichhasashareholdingof30,196,109

ordinaryshares.

Mr. Michael Murray-Bruce has an indirect shareholding through Manilla Properties Limited which has a shareholding of

6,490,360ordinaryshares.

SincethelastAnnualGeneralMeeting,Mr.NaveedRiazresignedfromtheboardandMr.AkinsowonDawoduwasappointed

totheBoard.

ThedirectorstoretirebyrotationatthenextAnnualGeneralMeeting(AGM)areMr.OlayemiCardoso,Mr.AdeAyeyemiand

Mr.KhalidQurashi.

PROPERTY AND EQUIPMENT

InformationrelatingtochangesinpropertyandequipmentisgiveninNote25ofthefinancialstatements.

SHAREHOLDING ANALYSIS

TheshareholdingpatternoftheGroupasat31December2013isasstatedbelow:

Share Range No. of Percentage of No. of Holdings Percentage

Shareholders Shareholders (%) Holdings

500,001 – 1,000,000 1 4 950,011 -

1,000,001 – 5,000,000 - - - -

5,000,001 – 10,000,000 5 19 34,365,234 1

10,000,001 – 50,000,000 18 69 409,856,643 15

50,000,001 – 100,000,000 1 4 60,416,666 2

100,000,001 – 500,000,000 - - - -

500,000,001 – 1,000,000,000 - - - -

ForeignShareholdersAbove 1,000,000,000 1 4 2,288,188,675 82

TOTAL 26 100 2,793,777,229 100

SUBSTANTIAL INTEREST IN SHARES

Accordingtotheregisterofmembersasat31December2013,noshareholderheldmorethan5%oftheissuedshare

capitaloftheBank,exceptthefollowing:

Shareholder No. of shares held Percentage of shareholding

CitibankOverseasInvestmentCorporation 2,288,188,675 81.9%

DIRECTORS

Directors’remunerationwaspaidasfollows:

2013 2012

N’000 N’000

Feesandsittingallowances 51,750 37,400

Executivecompensation 161,100 190,002

TOTAL 212,850 227,402

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Citibank Nigeria Limited Donations N

1 AbujaChildren’sHome 400,000

2 ArrowofGodOrphanage 500,000

3 AtundaOluSchool(ForPhysicallyHandicappedChildren) 750,000

4 BemaHomesfortheLessPriviledged 400,000

5 CareOrganizationPublicEnlightenment(COPE) 500,000

6 CCWAInternational 400,000

7 ChesireHome(Borokiri) 300,000

8 ChildLifeLine(Yaba&Ikorodu) 700,000

9 ChildrenEmergencyReliefFoundation 500,000

10 CompassionHomeforthePhysicallyHandicapped 300,000

11 DeMarillacCentre,PortHarcourt 400,000

12 DownSyndromeAssociationofNigeria 500,000

13 GreenPastureandHomeInitiative 500,000

14 HeartofGoldChildren’sHospice 1,000,000

15 HomefortheElderly,PortHarcourt 400,000

16 MedicalMissionariesofMaryHospital(Lugbe) 400,000

17 ModupeColeMemorialChildCareandTreatmentHome 1,000,000

18 NationalOrthopedicSpecialSchool(Igbobi) 500,000

19 NgwaRoadMotherlessBabiesHome 400,000

20NigerianRedCross 500,000

21 OurLadyofMercyOrphanage 400,000

22PacelliSchool(FortheBlind) 500,000

23PortHarcourtChildren’sHomo,Borokiri 300,000

24RightStepsIncorporated 400,000

25RosaliHomeRehabilitationCentre(Eleme,PH) 400,000

26SeventhDayAdventistMotherlessBabiesHome 400,000

27SickleCellClub 500,000

28SOSChildren’sVillage 500,000

29St.Anne’sOrphanage 400,000

30StartRightConsulting 400,000

31 TheBookTrust 400,000

32TheChild(ForMentallyRetardedChildren) 400,000

33WesleySchool1(ForDeafChildren) 500,000

34WesleySchool2(ForDeafChildren) 500,000

Sub- total 16,350,000

Citigroup Foundation Donations N

1 CitiMicro-entrepreneurshipAwardsProgram 9,604,800

3 FateFoundation 6,403,200

4 HopeWorldwide 4,962,480

5 JuniorAchievement 6,403,200

6 Leadership,Effectiveness,AccountabilityandProfessionalism 6,403,200

Sub-total 33,776,880

TOTAL 50,126,880

EMPLOYMENT OF DISABLED PERSONS

TheGroupcontinuestomaintainapolicyofgivingfairconsiderationtoapplicationforemploymentmadebydisabledpersons

withdueregardtotheirabilitiesandaptitudes.TheGroup’spoliciesprohibitdiscriminationagainstdisabledpersonsinthere-

cruitment,trainingandcareerdevelopmentofemployees.Intheeventofmembersofstaffbecomingdisabled,effortswillbe

madetoensurethattheiremploymentwiththeGroupcontinuesandappropriatetrainingarrangedtoensurethattheyfitinto

theGroup’sworkingenvironment.

HEALTH, SAFETY AND WELFARE AT WORK

TheGroupenforcesstricthealthandsafetyrulesandpracticesattheworkenvironment,whicharereviewedandtested

regularly.Inaddition,medicalfacilitiesareprovidedforstaffandtheirimmediatefamiliesattheGroup’sexpense.

Firepreventionandfire-fightingequipmentareinstalledinstrategiclocationswithintheGroup’spremises.

TheGroupoperatesbothGroupPersonalAccidentandWorkmen’sCompensationInsurancecoverforthebenefitofits

employees.ItisalsofullycompliantwiththeprovisionsoftheEmployeeCompensationAct.TheGroupalsooperatesa

contributorypensionplaninlinewiththePensionReformAct,2004.

EMPLOYEE INVOLVEMENT AND TRAINING

TheGroupensures,throughvariousfora,thatemployeesareinformedonmattersconcerningthem.Formalandinformal

channelsarealsoemployedincommunicationwithemployeeswithanappropriatetwo-wayfeedbackmechanism.

InaccordancewiththeGroup’spolicyofcontinuousdevelopment,theGroupdrawsextensivelyonCitigroup’straining

programmesaroundtheworld.Theprogrammesincludeonthejobtraining,classroomsessionsandweb-basedtraining

programmeswhichareavailabletoallstaff.Inaddition,employeesoftheGrouparenominatedtoattendbothlocallyand

internationallyorganizedcourses.

DIVERSITY IN EMPLOYMENT

TheGrouprecognisesthattherecruitment,involvementandadvancementofwomenandadiverseworkforcearebusiness

imperatives.Duringthefinancialyearended31December2013:

-Therewere88womenoutof243employeescomprising36%ofthetotalnumberofemployees;

-Therewas1womanoutof12DirectorsontheBoardofDirectors;

-Therewere35womenoutof104topmanagementstaff;

-Therewere34womenoutof100topmanagementstaffbetweenAssistantGeneralManagertoGeneralManagergrade;

-Therewas1womanoutof4topmanagementstaffbetweenExecutiveDirectortoChiefExecutiveOfficer;

-Thebankhadnopersonswithdisabilitiesinitsemployment.

TheGroupiscommittedtomaintainingapositiveworkenvironmentandtoconductingbusinessinapositive,professional

mannerbyconsistentlyensuringequalemploymentopportunity.TheGrouphasprogramsaimedatachievinggenderbalance

whichincludedevelopmentalprogramstargetedforwomen;mentoring;andpoliciesthatsupportWork-Lifebalance.

Inaddition,toabovecharitablecontributions,theultimateparentcompany,CitigroupInc,throughCitigroupFoundationmade

thefollowingdonationsinNigeria:

POST BALANCE SHEET EVENTS

TherewerenopostbalancesheeteventswhichcouldhaveamaterialeffectonthefinancialpositionoftheGroupasat31

December2013orthestatementofprofitandlossandothercomprehensiveincomefortheyearendedonthatdatethathave

notbeenadequatelyprovidedforordisclosed.

DONATIONS AND CHARITABLE GIFTS

TheGroupandCitigroupFoundationmadecontributionstocharitableandnon-politicalorganizationsamountingto

N50,126,880(2012:N64,274,150)duringtheyearasanalyzedbelow:

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CONSUMER HELP DESK

TheGrouphasestablishedaconsumercomplaintshelpdesktohandleallcategoriesofcustomercomplaints.Duringthe

financialyearended31December,2013,thesummaryofconsumercomplaintsareascontainedinthetablebelow:

S/N Number Amount Claimed Amount Refunded

2012 2013 2012 2013 2012 2013

1 PendingcomplaintsB/F* - 3 - 787,500 - 1,197,000

2 Receivedcomplaints 119 26 86,419,025 26,001,763 22,706,306 10,726,705

3 Resolvedcomplaints 116 28 85,631,525 17,883,613 22,706,306 9,150,720

4 Unresolvedcomplaintsescalatedto

CBNforintervention - 1 - 8,118,151 - 1,575,985

5 Unresolvedcomplaintspendingwith

thebankC/F 3 - 787,500 - 1,197,000 -

*TheamountclaimedB/Fwasbasedononeaccount,whileamountrefundedwasbasedonmultipleaccounts.

Therewerenounresolvedcomplaintsasatyearend.

AUDITORS

PricewaterhouseCoopershaveindicatedtheirwillingnesstocontinueinofficeasauditorsinaccordancewith

Section357(2)oftheCompaniesandAlliedMattersAct.

CharlesS.SankeyHouse BYORDEROFTHEBOARD

27,KofoAbayomiStreet

VictoriaIsland

Lagos

March6,2014 OLUSOLA FAGBURE,CompanySecretary

FRC/2013/CIBN/00000002203

CORPORATE GOVERNANCE REPORTFOR THE YEAR ENDED 31 DECEMBER 2013

Citibank Nigeria Limited is committed to ensuring the implementation of good corporate governance principles in all its

activities.CitibankNigeriaLimitedadherestotheprovisionsoftheCentralBankofNigeriaCodeonCorporateGovernance

forBanksinNigeria-PostConsolidation(‘theCode’)andtoCitigroupcorporategovernanceprinciples.Corporategovernance

complianceismonitoredandamonthlyreportontheBank’scompliancewiththeCodeissubmittedtotheCentralBankof

Nigeria.TheBoardofDirectorsundergoestrainingincorporategovernancebestpractices.

THE BOARD OF DIRECTORS

The Board of Directors consists of twelve members comprising the Chairman, the Managing Director, six Non-Executive

Directors and four Executive Directors. Two of the Non-Executive Directors are Independent Directors, appointed based

oncriterialaiddownbytheCentralBankofNigeria.NeitheroftheIndependentDirectorshasanyshareholdinginterestor

businessrelationshipwiththeBank.TheDirectorsandtheirshareholdingsarelistedintheDirectors’report.

TheBoardisresponsiblefortheoversightofexecutivemanagement,ensuringthattheBank’soperationsareconductedin

accordancewithlegalandregulatoryrequirements,approvingandreviewingcorporatestrategyandperformance,andfor

ensuringthattherightsoftheshareholdersareprotectedatalltimes.ThemembersoftheBoardpossessthenecessary

experienceandexpertisetoexercisetheiroversightfunctions.

InaccordancewiththeprovisionsoftheCode,theofficeandresponsibilitiesoftheChairmanandtheManagingDirector/Chief

Executiveareseparate.

The Board meets quarterly and additional meetings are convened as required. The Board may take decisions between

meetingsbywayofwrittenresolution,asprovidedforintheArticlesofAssociationoftheBank.In2013theBoardmetfive

times.

TheBoardhasdelegatedsomeofitsresponsibilitiestothefollowingstandingboardcommittees:RiskManagementCommittee,

AuditCommittee,CreditCommitteeandtheExecutiveDirectorsRemunerationCommittee.Eachofthesecommitteesreports

totheBoardonitsactivities.TheChairmanoftheBoardisnotamemberofanyoftheboardcommittees.

Board Committees

a) The Risk Management Committee

TheRiskManagementCommitteeconsistsofsevendirectors,twoofwhom,includingtheChairmanoftheCommittee,areNon-

ExecutiveDirectors.TheCommitteeisresponsibleforoverseeingtheBank’sRiskManagementpoliciesandproceduresinthe

areasoffranchise,operational,creditandmarketrisk.TheCommitteemeetsquarterlyandmetfourtimesduringtheyear.

b) The Credit Committee

TheCreditCommitteeconsistsoffivedirectors,twoofwhom,includingtheChairmanoftheCommitteeareNon-Executive

Directors.TheCommitteeisresponsibleforapprovingcreditsabovesuchlimitsasmaybeprescribedbytheBoardofDirectors

fromtimetotime.TheCommitteemeetsquarterlyandmetfourtimesduringtheyear.

c) The Audit Committee

TheAuditCommitteeconsistsoftwoshareholdersandtwonon-executivedirectors.TheChairmanoftheCommittee isa

shareholder.

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The Committee’s responsibilities include the review of the integrity of the Bank’s financial reporting, oversight of the

independenceandobjectivityoftheexternalauditors,thereviewofthereportsofexternalauditorsandregulatoryagencies

andmanagementresponsesthereto,andthereviewoftheeffectivenessoftheBank’ssystemofaccountingand internal

control.

DuringtheyeartheCommitteeapprovedtheexternalauditors’termsofengagementandscopeofworkandalsoreviewedthe

internalauditor’sauditplan.TheCommitteereceivedregularinternalauditreportsfromtheBank’sinternalauditor.Members

oftheCommitteehaveunrestrictedaccesstotheBank’sexternalauditors.

TheCommitteemeetsquarterlyandmetfourtimesduringtheyear.

d) Executive Directors Remuneration Committee

TheCommitteeismadeupofthreenon-executivedirectorsandisresponsiblefordeterminingtheremunerationofExecutive

Directors.

GENERAL MEETINGS

ThelastAnnualGeneralMeetingwasheldonApril25,2013.AnExtra-ordinaryGeneralMeetingwasheldonDecember5,

2013.

RISK AND CONTROLS

InlinewithCitigrouppolicies,theBankmaintainsastrongcontrolenvironment.Theinternalcontrolsystemisdesignedto

achieveefficiencyandeffectivenessofoperations,reliabilityoffinancialreportingandcompliancewithapplicablelawsand

regulationsatalllevelsoftheGroupasrequiredbytheCode.

Robustriskmanagementpoliciesandmechanismshavebeenputinplacetoensureidentificationofriskandeffectivecontrol.

TheBoard,throughtheBoardRiskManagementCommittee,overseestheBank’sriskmanagementpolicies.

WHISTLE BLOWING PROCEDURES

InlinewiththeBank’scommitmenttoinstillbestcorporategovernancepractices,theBankhasestablishedawhistleblowing

procedurethatensuresanonymity.TheBankhasadedicatedwhistleblowinghotlineande-mailaddress.TheChiefCompliance

OfficerforwardsmonthlyreturnstotheCentralBankofNigeriaonallwhistle-blowingreportsandcorporate

governancebreaches.

CODE OF CONDUCT

TheBankhasaCodeofConductwhichallofficersoftheBankareexpectedtoadhereto.Allstaffareexpectedtostriveto

maintainthehigheststandardsofethicalconductandintegrityinallaspectsoftheirprofessionallifeasprescribedinthe

CodeofConduct.

MANAGEMENT SUCCESSION

TheBankhasastrongmanagementteamandadocumentedsuccessionplanforeveryexecutiverolewithintheBank.

STATEMENT OF RESPONSIBILITY AND APPROVALFOR THE YEAR ENDED 31 DECEMBER 2013

Responsibility for Annual Financial Statements

InaccordancewiththeprovisionsoftheCompaniesandAlliedMattersActandtheBanksandOtherFinancialInstitutions

Act,thedirectorsareresponsibleforthepreparationoftheannualfinancialstatementswhichgiveatrueandfairviewofthe

stateofaffairsoftheGroupattheendoftheyearandofthefinancialperformanceandcashflowsfortheyearthenended.

Theresponsibilitiesincludeensuringthat:

i. theGroupkeepsproperaccountingrecordsthatdisclose,withreasonableaccuracy,thefinancialpositionofthe

GroupandcomplywiththerequirementsoftheCompaniesandAlliedMattersActandtheBanksandOtherFinancial

InstitutionsAct;

ii. appropriateandadequateinternalcontrolsareestablishedtosafeguarditsassetsandtopreventanddetectfraudand

otherirregularities;

iii. theGrouppreparesitsfinancialstatementsusingsuitableaccountingpoliciessupportedbyreasonableandprudent

judgementsandestimates,thatareconsistentlyapplied;and

iv. itisappropriateforthefinancialstatementstobepreparedonagoingconcernbasis.

The directors accept responsibility for the annual financial statements, which have been prepared using appropriate

accountingpoliciessupportedbyreasonableandprudentjudgementsandestimates,inconformitywith,

-InternationalFinancialReportingStandards;

-PrudentialGuidelinesforLicensedBanks;

-RelevantcircularsissuedbytheCentralBankofNigeria;

-TherequirementsoftheBanksandOtherFinancialInstitutionsAct;

-TherequirementsoftheCompaniesandAlliedMattersAct;and

-TherequirementsoftheFinancialReportingCouncilofNigeriaAct.

Thedirectorsareoftheopinionthatthefinancialstatementsgiveatrueandfairviewofthestateofthefinancialpositionof

theBankandofitsfinancialperformanceandcashflowsfortheyear.

The directors further accept responsibility for the maintenance of accounting records that may be relied upon in the

preparationoffinancialstatements,aswellasadequatesystemsofinternalfinancialcontrol.

NothinghascometotheattentionofthedirectorstoindicatethattheGroupwillnotremainagoingconcernforat least

twelvemonthsfromthedateofthisstatement.

SIGNEDONBEHALFOFTHEBOARDOFDIRECTORSBY:

MR. OLAYEMI CARDOSO MR. OMAR HAFEEZ

Chairman ManagingDirector

March6,2014

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REPORT OF THE AUDIT COMMITTEEFOR THE YEAR ENDED 31 DECEMBER 2013

TothemembersofCitibankNigeriaLimited.

ThemembersoftheBoardAuditCommitteeofCitibankNigeriaLimitedherebyreportasfollows:

-WehaveexercisedtheresponsibilitiesassignedtotheBoardAuditCommitteebytheCentralBankofNigeria’sCodeof

CorporateGovernanceforBanksandacknowledgetheco-operationofmanagementandstaffintheconductofthese

responsibilities.WeareoftheopinionthattheaccountingandreportingpoliciesoftheGroupareinaccordancewithle-

galrequirementsandagreedethicalpracticesandthatthescopeandplanningofboththeexternalandinternalaudits

fortheyearended31December2013weresatisfactoryandreinforcetheGroup’sinternalcontrolsystems.

-WearesatisfiedthattheGrouphascompliedwiththeprovisionsofCentralBankofNigeriacircularBSD/1/2004dat-

ed18February2004on“Disclosureofinsiderrelatedcreditsinthefinancialstatementsofbanks”,andherebyconfirm

thatthereisnooutstandingcreditexposureasat31December2013(31December2012:Nil).

-WehavedeliberatedwiththeExternalAuditors,whohaveconfirmedthatnecessarycooperationwasreceivedfrom

Managementinthecourseoftheirstatutoryauditandwearesatisfiedwithmanagement’sresponsestotheExternal

Auditor’srecommendationforimprovementandwiththeeffectivenessoftheGroup’ssystemofaccountingandinter-

nalcontrol.

-WearesatisfiedthattheGrouphasputinplacestronginternalcontrolstructuresandthelevelofcomplianceiscon-

sideredsatisfactory.

CHIEF EDET JAMES AMANA

Chairman,AuditCommittee

March6,2014

MembersoftheAuditCommitteeare:

1 ChiefEdetJamesAmana-Chairman

2 Mr.MichaelMurray-Bruce

3 ChiefArthurMbanefoCON

4ChiefAbelUbeku

DCSL Corporate Services Limited 235 Ikorodu Road Abuja Office: Ilupeju 4th Floor, Bank of Industry Building P. O. Box 965, Marina Central Business District Lagos, Nigeria Abuja, Nigeria Tel: +234 9 4614902-5 Tel: +234 1 2717817 Port-Harcourt Office: Fax: +234 1 2717801 15 Emeyal Street, GRA www.dcsl.com.ng Phase II, Port Harcourt RC NO. 352393

The Chairman Board of Directors Citibank Nigeria Limited 27 Kofo Abayomi Street Victoria Island Lagos REPORT OF THE EXTERNAL CONSULTANTS ON THE EVALUATION OF THE BOARD OF DIRECTORS OF CITIBANK NIGERIA LIMITED FOR THE YEAR ENDED 31 DECEMBER 2013

DCSL Corporate Services Limited was engaged to carry out an evaluation of the Board of Citibank Nigeria Ltd (Citibank) as required by Section 5.4.6 of the Central Bank of Nigeria (CBN) Code of Corporate Governance (“the Code”), covering all aspects of the Board’s structure and composition, responsibilities, processes and relationships for the period-ended 31st December 2013. Our responsibility is to reach a conclusion on the Board’s performance based on work carried out within the scope of our engagement as contained in our engagement letter dated the 9th January 2014. The exercise entailed an appraisal of the Board and benchmarking the Board’s practices against the CBN Code using the following key corporate governance considerations:

Board Structure and Composition Strategy and Planning Board Operations and Effectiveness Measuring and Monitoring Performance Risk Management and Compliance Corporate Citizenship ( social, ethics, environment) Transparency & Disclosure

On the basis of our work, it is our conclusion that nothing has come to our attention which causes us to believe that the Board’s performance does not comply in any material respect with the provisions of the Code. Our recommendations aimed at ensuring the continuation of this stellar performance are contained in our detailed Report. Yours faithfully, For: DCSL Corporate Services Ltd

Bisi Adeyemi Managing Director March, 2014

Directors: ● Abel Ajayi (Chairman) ● Obi Ogbechi ● Seni Ogunsanya ● Adebisi Adeyemi (Managing Director)

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CONSOLIDATED STATEMENT OF PROFIT OR LOSS

FOR THE YEAR ENDED 31 DECEMBER Note 2013 2012

N’000 N’000

Interestincome 5. 20,328,700 21,594,061

Interestexpense 6. (4,808,296) (6,187,529)

Net interest income 15,520,404 15,406,532

Feeandcommissionincome 7. 4,205,137 4,184,170

Feeandcommissionexpense 7. (34,160) (20,435)

Netgains/(losses)fromfinancialinstrumentsheldfortrading 8. 5,074,127 6,253,435

Netinvestmentincome 9. 3,622,999 2,157,284

Otheroperatingincome 10. 184,946 176,326

Net operating income 28,573,453 28,157,312

Personnelexpenses 11. (5,334,864) (5,156,267)

Otheroperatingexpenses 12. (5,616,893) (5,231,571)

Amortisationofintangibleassets 26. (7,507) (8,189)

Depreciationofproperty,plantandequipment 25. (345,628) (676,708)

Netcreditlosses 13. (436,536) (241,971)

Operating profit 16,832,025 16,842,606

Shareofprofitofassociatesaccountedforusingequitymethod 24. 78,197 56,652

Profit before tax 16,910,222 16,899,258

Incometaxexpense 14. (3,267,092) (3,874,866)

Profit for the year 13,643,130 13,024,392

Profit attributable to:

Ownersoftheparent 13,643,130 13,024,392

Non-controllinginterests - -

13,643,130 13,024,392

Earnings per share attributable to the equity holders of the parent entity during the year

Basic 15. 4.99 4.76

Diluted 15. 4.99 4.76

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER Notes 2013 2012

N’000 N’000


Other comprehensive income:

Itemsthatmaybesubsequentlyreclassifiedtoprofitorloss:

Fairvaluereserve(available-for-salesecurities):

Netchangeinfairvalue 21. (756,683) 6 ,886,739

Netamounttransferredtoprofitorloss 21. (1,897,686) (45,917)

Nettaxonitemstakenthroughothercomprehensiveincome 14. 796,311 (2,052,247)

Other comprehensive income for the year, net of tax (1,858,058) 4,788,575

Total comprehensive income for the year 11,785,072 17,812,967

Total comprehensive income attributable to:

Ownersoftheparent 11,785,072 17,812,967

Non-controllinginterests - -

11,785,072 17,812,967

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Thefinancialstatementswerecertifiedby:

ManagingDirector:Mr.OmarHafeez ChiefFinanceOfficer:HildaMucuha

FRC/2013/CIBN/00000002202 FRC/2013/ICAN/00000001241

Thenotes1to43areanintegralpartoftheseconsolidatedfinancialstatements.Thefinancialstatementsonpages44to112

wereapprovedandauthorisedforissuebytheBoardofDirectorsonMarch62014andweresignedonitsbehalfby:

Chairman:Mr.OlayemiCardoso ManagingDirector:Mr.OmarHafeez

FRC/2013/CISN/00000002200 FRC/2013/CIBN/00000002202

31 December 31 December

AS AT Note 2013 2012

N’000 N’000

ASSETS

CashandbalanceswithCentralBankofNigeria 16. 22,996,953 20,762,072

Loansandadvancestobanks 17. 122,258,126 121,241,497

Loansandadvancestocustomers 18. 81,538,729 61,168,214

Tradingsecurities 19. 14,466,556 10,962,881

Derivativefinancialinstruments 20. 14,237 167,107

Investmentsecurities 21. 89,778,262 97,501,871

Assetspledgedascollateral 22. 4,646,152 7,808,015

Otherassets 23. 1,091,075 850,692

Investmentsinassociates 24. 564,864 497,762

Property,plantandequipment 25. 2,606,933 2,618,705

Intangibleassets 26. - 7,508

Deferredtaxasset 34. 359,545 -

Total assets 340,321,432 323,586,324

LIABILITIES

Depositsfrombanks 27. 1,263,243 10,440,127

Depositsfromcustomers 28. 276,901,195 250,158,010


Retirementbenefitobligation 29. 8,063 13,054

Currentincometaxliabilities 30. 3,740,849 3,551,266

Otherborrowedfunds 31. 700,000 2,285,714

Otherliabilities 32. 7,376,514 6,930,799

Provisions 33. 58,488 58,488

Deferredtaxliability 34. - 782,924

Total liabilities 290,060,745 274,313,932

EQUITY

Sharecapital 35. 2,793,777 2,793,777

Sharepremium 35. 11,643,995 11,643,995

Treasurysharereserve 35. (60,417) (60,417)

Statutoryreserves 35. 19,943,575 17,871,399

Fairvaluereserve 35. (1,108,780) 749,278

Retainedearnings 17,048,537 16,274,360

Total equity 50,260,687 49,272,392

Total equity and liabilities 340,321,432 323,586,324

4746

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Attributable to equity holders of the parent N’000

Share Share Treasury Retained Statutory Fair value Regulatory

capital premium shares earnings reserve reserve risk reserve Total

reserve

Balanceat

1January2013 2,793,777 11,643,995 (60,417) 16,274,360 17,871,399 749,278 - 49,272,392

Profit - - - 13,643,130 - - - 13,643,130

Changeinfairvalue

ofavailable-for-sale

securities,netoftax - - - - - (1,858,058) - (1,858,058)

Total comprehensive

income - - - 13,643,130 - (1,858,058) - 11,785,072

Dividendpaid - - - (10,796,777) - - - (10,796,777)

TransfertoStatutory

reserve - - - (2,072,176) 2,072,176 - - -

At

31December2013 2,793,777 11,643,995 (60,417) 17,048,537 19,943,575 (1,108,780) - 50,260,687

FOR THE YEAR ENDED Note 31 December 2013 31 December 2012

N’000 N’000

Cash flows from operating activities


Adjustments for non-cash items:

Impairmentofloansandadvances 13. 436,536 241,971

Additional/(release)ofimpairmentofequityinvestment 9. - 11,720

(Gain)/lossondisposalofequityinvestment (5,317) (28,321)

Depreciationofproperty,plantandequipment 26. 345,628 676,708

Amortisationofintangibleassets 25. 7,507 8,189

(Gain)/lossondisposalofproperty,plantandequipment 10. (16,225) (2,264)

AssociatesShareofProfitsfromequitymethodinvestments 24. (78,197) (56,652)

Dividendincome 9. (33,939) (16,037)

Dividendpaidontreasuryshares 11. 238,646 178,229

17,804,861 17,912,801

Changes in operating assets and liabilities

(Increase)/decreaseincashreservebalance (3,232,108) (6,418,981)

(Increase)/decreaseinloansandadvancestobanks (7,085,926) (696,943)

(Increase)/decreaseinloansandadvancescustomer (20,776,973) (5,580,835)

(Increase)/decreaseintradingassets (3,284,334) (2,671,398)

(Increase)/decreaseinpledgedassets 3,161,863 (1,576,734)

(Increase)/decreaseinderivativefinancialinstruments 152,870 216,280

(Increase)/decreaseinotherassets (240,383) (507,872)

Increase/(decrease)indepositsfrombanks (9,176,884) 10,192,119

Increase/(decrease)inotherborrowedfunds (1,585,714) (200,286)

Increase/(decrease)indepositsfromcustomers 23,784,140 (63,040,143)

Increase/(decrease)inderivativefinancialinstruments (81,157) (155,376)

Increase/(decrease)inretirementbenefitobligation (4,991) 2,160

Increase/(decrease)inotherliabilities 445,715 330,779

(119,018) (52,194,429)

Incometaxespaid 30. (3,423,668) (2,586,750)

Net cashflows from/(used in) operating activities (3,542,686) (54,781,179)

Cash flows from investing activities

Purchaseofproperty,plantandequipment 25. (382,679) (627,616)

Proceedfromsaleofproperty,plantandequipment 65,048 56,300

Proceedfromsaleofequityinvestment 26,917 62,538

Dividendsreceived 9. 45,034 24,913

Purchaseofdebtinvestmentsecurities 21. (53,516,111) (45,828,781)

Disposalofdebtinvestmentsecurities 21. 58,567,539 19,110,307

Net cash used in investing activities (4,805,748) (27,202,340)

Cash flows from financing activities

Dividendpaid 39. (11,035,420) (8,241,643)

Net cash used in financing activities (11,035,420) (8,241,643)

Cashandcashequivalentsatstartofyear 125,353,142 218,113,721

Increase/(decrease)incashandcashequivalents (9,772,359) (90,225,163)

Effectsofexchange-ratechangesoncashandcashequivalents 2,959,045 (2,535,415)

Cash and cash equivalents at end of year 40. 118,539,828 125,353,142

CONSOLIDATED STATEMENT OF CASHFLOWS

Attributable to equity holders of the parent N’000

Share Share Treasury Retained Statutory Fair value Regulatory

capital premium shares earnings reserve reserve risk reserve Total

reserve

Balanceat

1January2012 2,793,777 11,643,995 (60,417) 13,338,502 15,846,278 (4,039,297) - 39,522,838

Profit - - - 13,024,392 - - - 13,024,392

Changeinfairvalue


securities,netoftax - - - - - 4,788,575 - 4,788,575

Total comprehensive

income - - - 13,024,392 - 4,788,575 - 17,812,967

Dividendpaid - - - (8,063,413) - - - (8,063,413)

Transferfromretained

earnings - - - (2,025,121) 2,025,121 - - -

At

31December2012 2,793,777 11,643,995 (60,417) 16,274,360 17,871,399 749,278 - 49,272,392

4948


N’000 N’000

Interestincome 5. 20,328,700 21,594,061

Interestexpense 6. (4,808,296) (6,187,529)

Net interest income 15,520,404 15,406,532

Feeandcommissionincome 7. 4,205,137 4,184,170

Feeandcommissionexpense 7. (34,160) (20,435)

Netgains/(losses)fromfinancialinstrumentsheldfortrading 8. 5,074,127 6,253,435

Netinvestmentincome 9. 3,634,095 2,166,160

Otheroperatingincome 10. 184,946 176,326

Net operating income 28,584,549 28,166,188

Personnelexpenses 11. (5,096,218) (4,978,037)

Otheroperatingexpenses 12. (5,617,142) (5,231,807)

Amortisationofintangibleassets 26. (7,507) (8,189)

Depreciationofproperty,plantandequipment 25. (345,628) (676,708)

Netcreditlosses 13. (436,536) (241,971)


Incometaxexpense 14. (3,267,012) (3,874,791)


Earnings per share for profit attributable to the equity holders of the

parent entity during the year

Basic 15. 4.94 4.71

Diluted 15. 4.94 4.71

BANK STATEMENT OF PROFIT OR LOSS


N’000 N’000


Other comprehensive income:

Itemsthatmaybesubsequentlyreclassifiedtoprofitorloss

Fairvaluereserve(available-for-salesecurities):

Netchangeinfairvalue 21. (756,683) 6,886,739

Netamounttransferredtoprofitorloss 21. (1,897,686) (45,917)

Nettaxonitemstakenthroughothercomprehensiveincome 14. 796,311 (2,052,247)

Other comprehensive income for the year, net of tax (1,858,058) 4,788,575

Total comprehensive income for the year 11,956,447 17,943,260

BANK STATEMENT OF COMPREHENSIVE INCOME

5150

BANK STATEMENT OF FINANCIAL POSITION

Thefinancialstatementswerecertifiedby:

ManagingDirector:Mr.OmarHafeez ChiefFinanceOfficer:HildaMucuha

FRC/2013/CIBN/00000002202 FRC/2013/ICAN/00000001241

Thenotes1to43areanintegralpartoftheseconsolidatedfinancialstatements.Thefinancialstatementsonpages44to112

wereapprovedandauthorisedforissuebytheBoardofDirectorsonMarch62014andweresignedonitsbehalfby:

Chairman:Mr.OlayemiCardoso ManagingDirector:Mr.OmarHafeez

FRC/2013/CISN/00000002200 FRC/2013/CIBN/00000002202

AS AT: Note 31 December 2013 31 December 2012

N’000 N’000

ASSETS

CashandbalanceswithCentralBankofNigeria 16. 22,996,953 20,762,072

Loansandadvancestobanks 17. 122,258,126 121,241,497

Loansandadvancestocustomers 18. 81,538,729 61,168,214

Tradingsecurities 19. 14,466,556 10,962,881


Investmentsecurities 21. 89,778,262 97,501,871

Assetspledgedascollateral 22. 4,646,152 7,808,015

Otherassets 23. 1,091,075 850,692

Investmentsinassociates 24. 398,020 398,020

Investmentinsubsidiary 41. 1,000 1,000

Property,plantandequipment 25. 2,606,933 2,618,705

Intangibleassets 26. - 7,508

Deferredtaxasset 34. 359,545 -

Total assets 340,155,588 323,487,582

LIABILITIES

Depositsfrombanks 27. 1,263,243 10,440,127

Depositsfromcustomers 28. 276,902,420 250,159,008


Retirementbenefitobligation 29. 8,063 13,054

Currentincometaxliabilities 30. 3,740,717 3,551,190

Otherborrowedfunds 31. 700,000 2,285,714

Otherliabilities 32. 7,376,770 6,931,057

Provisions 33. 58,488 58,488

Deferredtaxliability 34. - 782,924

Total liabilities 290,062,094 274,315,112

EQUITY

Sharecapital 35. 2,793,777 2,793,777

Sharepremium 35. 11,643,995 11,643,995

Statutoryreserves 35. 19,943,575 17,871,399

Fairvaluereserve 35. (1,108,780) 749,278


Total equity 50,093,494 49,172,470

Total equity and liabilities 340,155,588 323,487,582

BANK STATEMENT OF CHANGES IN EQUITY

Attributable to equity holders of the bank N’000

Share Share Retained Statutory Fair value Regulatory

capital premium earnings reserve reserve risk reserve Total

Balanceat

1January2013 2,793,777 11,643,995 16,114,021 17,871,399 749,278 - 49,172,470

Profit - - 13,814,505 - - - 13,814,505

Changeinfairvalue


securities,netoftax - - - - (1,858,058) - (1,858,058)

Total comprehensive

income - - 13,814,505 - (1,858,058) - 11,956,447

Dividendpaid - - (11,035,422) - - - (11,035,422

TransfertoStatutory

reserve - - (2,072,176) 2,072,176 - - -

Transfertoregulatory

creditreserve - - - - - - -

At31December2013

2,793,777 11,643,995 16,820,928 19,943,575 (1,108,780) - 50,093,494

Attributable to equity holders of the bank N’000

Share Share Retained Statutory Fair value Regulatory

capital premium earnings reserve reserve risk reserve Total

Balanceat

1January2012 2,793,777 11,643,995 13,226,099 15,846,278 (4,039,297) - 39,470,852

Profit - - 13,154,685 - - - 13,154,685

Changeinfairvalue


securities,netoftax - - - - 4,788,575 - 4,788,575

Total comprehensive

income - - 13,154,685 - 4,788,575 - 17,943,260

Dividendpaid - - (8,241,642) - - - (8,241,642)

Transferfromretained

earnings - - (2,025,121) 2,025,121 - - -

At31December2012

2,793,777 11,643,995 16,114,021 17,871,399 749,278 - 49,172,470

5352

FOR THE YEAR ENDED Note 31 December 31 December

2013 2012

N’000 N’000

Cash flows from operating activities


Adjustments for non-cash items:

Impairmentofloansandadvances 13. 436,536 241,971

Additional/(release)ofimpairmentofequityinvestment 9. - 11,720

(Gain)/lossondisposalofequityinvestment (5,317) (28,321)

Depreciationofproperty,plantandequipment 25. 345,628 676,708

Amortisationofintangibleassets 26. 7,507 8,189

(Gain)/lossondisposalofproperty,plantandequipment 10. (16,225) (2,264)

Dividendincome 9. (45,034) (24,913)

17,804,612 17,912,566

Changes in operating assets and liabilities

(Increase)/decreaseincashreservebalance (3,232,108) (6,418,981)

(Increase)/decreaseinloansandadvancestobanks (7,085,926) (696,943)

(Increase)/decreaseinloansandadvancescustomer (20,776,973) (5,580,835)

(Increase)/decreaseintradingassets (3,284,334) (2,671,398)

(Increase)/decreaseinpledgedassets 3,161,863 (1,576,734)

(Increase)/decreaseinderivativefinancialinstruments 152,870 216,280

(Increase)/decreaseinotherassets (240,383) (507,872)

Increase/(decrease)indepositsfrombanks (9,176,884) 10,192,119

Increase/(decrease)inotherborrowedfunds (1,585,714) (200,286)

Increase/(decrease)indepositsfromcustomers 23,784,367 (63,040,326)

Increase/(decrease)inderivativefinancialinstruments (81,157) (155,376)

Increase/(decrease)inretirementbenefitobligation (4,991) 2,160

Increase/(decrease)inprovision - -

Increase/(decrease)inotherliabilities 445,713 331,196

(119,045) (52,194,429)

Incometaxespaid 30. (3,423,644) (2,586,750)

Netcashflowsfrom/(usedin)operatingactivities (3,542,689) (54,781,180)

Cash flows from investing activities

Purchaseofproperty,plantandequipment 25. (382,679) (627,616)

Proceedfromsaleofproperty,plantandequipment 65,048 56,300

Proceedfromsaleofequityinvestment 26,917 62,538

Dividendsreceived 45,034 24,913

Purchaseofdebtinvestmentsecurities 21. (53,516,111) (45,828,781)

Maturity/Salesofdebtinvestmentsecurities 21. 58,567,539 19,110,306

Net cash used in investing activities 4,805,748 (27,202,340)

Cash flows from financing activities

Dividendpaid 39. (11,035,420) (8,241,643)

Netcashusedinfinancingactivities (11,035,420) (8,241,643)

Cashandcashequivalentsatstartofyear 125,353,142 218,113,721

Increaseincashandcashequivalents (9,772,359) (90,225,164)

Effectsofexchange-ratechangesoncashandcashequivalents 2,959,045 (2,535,415)

Cash and cash equivalents at end of year 40. 118,539,828 125,353,142

BANK STATEMENT OF CASHFLOWS NOTES TO THE ANNUAL FINANCIAL STATEMENTS

1. GENERAL INFORMATION

Citibank Nigeria Limited (“the Bank”) is a company domiciled in Nigeria. The address of the Bank’s registered office is 27

KofoAbayomiStreet,Victoria Island,Lagos.Theseconsolidatedfinancialstatements for theyearended31December2013

arepreparedfortheBankanditssubsidiaries(together,“theGroup”).TheGroupisprimarilyinvolvedincommercialbanking

thatincludestransactionalservices,corporatefinance,provisionoffinance,custodialbusinessandmoneymarketandtrading

activities

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.1 Introduction to the summary of significant accounting policies

Theprincipalaccountingpoliciesadoptedinthepreparationoftheseconsolidatedfinancialstatementsaresetoutbelow.

Thesepolicieshavebeenconsistentlyappliedtoalltheyearspresented,unlessotherwisestated.

2.2 Basis of preparation

The consolidated financial statements for the year 2013 have been prepared in accordance with International Financial

Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). Additional information

requiredbynationalregulationsisincludedwhereappropriate.

2.2.1 Basis of measurement

The financial statements are prepared under the historical cost convention, modified to include the fair value of certain

financialinstrumentstotheextentrequiredorpermittedundertheaccountingstandardsassetoutintherelevantaccounting

policies.

TheyhavealsobeenpreparedinthemannerrequiredbytheCompaniesandAlliedMattersActofNigeria,BanksandOther

FinancialInstitutionsActofNigeriaandrelevantCentralBankofNigeriacirculars.

2.2.2 Use of estimates and judgements

Thepreparationoffinancialstatements inconformitywith IFRSrequiresmanagementtomake judgments,estimatesand

assumptionsthataffecttheapplicationofpoliciesandreportedamountsofassetsandliabilitiesanddisclosuresofcontingent

assetsandliabilitiesatthedateofthefinancialstatementsandthereportedamountsofrevenuesandexpensesduringthe

reportedperiod.Theestimatesandassumptionsarebasedonmanagement’sbestknowledgeofcurrentevents,actions,

historicalexperienceandvariousotherfactorsthatarebelievedtobereasonableunderthecircumstances,theresultsof

whichformthebasisofmakingthejudgmentsaboutthecarryingvaluesofassetsandliabilitiesthatarenotreadilyapparent

fromothersources.Actualresultsmaydifferfromtheseestimates.

Theestimatesandunderlyingassumptionsarereviewedonanongoingbasis.Revisionstoaccountingestimatesarerecognised

intheperiodinwhichtheestimateisrevisediftherevisionaffectsonlythatperiodorintheperiodoftherevisionandfuture

periodsiftherevisionaffectsbothcurrentandfutureperiods.

2.2.3 Changes in accounting policy and disclosures

i) New and amended standards adopted by the group

The following standards havebeenadopted by the group for the first time for the financial yearbeginningonorafter 1

January2013andhaveamaterialimpactonthegroup:

• Amendment to IAS 1, ‘Financial statementpresentation’ regardingothercomprehensive income.Themainchange

resulting from these amendments is a requirement for entities to group items presented in ‘other comprehensive

income’(OCI)onthebasisofwhethertheyarepotentiallyreclassifiabletoprofitorlosssubsequently(reclassification

adjustments).

5554

• AmendmenttoIFRS7,‘Financialinstruments:Disclosures’,onassetandliabilityoffseting.Thisamendmentincludes

newdisclosurestofacilitatecomparisonbetweenthoseentitiesthatprepareIFRSfinancialstatementstothosethat

preparefinancialstatementsinaccordancewithUSGAAP.

• IFRS10,‘Consolidatedfinancialstatements’buildsonexistingprinciplesbyidentifyingtheconceptofcontrolasthe

determiningfactorinwhetheranentityshouldbeincludedwithintheconsolidatedfinancialstatementsoftheparent

company.Thestandardprovidesadditionalguidancetoassistinthedeterminationofcontrolwherethisisdifficultto

assess.Seenote41fortheimpactonthefinancialstatements.

• IFRS12,‘Disclosuresofinterestsinotherentities’includesthedisclosurerequirementsforallformsofinterestsin

otherentities,includingjointarrangements,associates,structuredentitiesandotheroffbalancesheetvehicles.See

note41fordisclosureofinterestinotherentities

• IFRIC21,‘Levies’ThisisaninterpretationofIAS37,‘Provisions,contingentliabilitiesandcontingentassets’.IAS37

setsoutcriteria fortherecognitionofa liability,oneofwhich is therequirementfortheentitytohaveapresent

obligationasaresultofapastevent(knownasanobligatingevent).Theinterpretationclarifiesthattheobligating

eventthatgivesrisetoaliabilitytopayalevyistheactivitydescribedintherelevantlegislationthattriggersthe

paymentofthelevy.

• IFRS13,‘Fairvaluemeasurement’,aimstoimproveconsistencyandreducecomplexitybyprovidingaprecisedefinition

offairvalueandasinglesourceoffairvaluemeasurementanddisclosurerequirementsforuseacrossIFRSs.The

requirements,whicharelargelyalignedbetweenIFRSsandUSGAAP,donotextendtheuseoffairvalueaccounting

butprovideguidanceonhowitshouldbeappliedwhereitsuseisalreadyrequiredorpermittedbyotherstandards

withinIFRSs

• IAS27(revised)isrenamed‘Separatefinancialstatements’andnowdealsonlywithseparatefinancialstatements.

Theexistingguidanceforseparatefinancialstatementsisunchanged.

• IAS28(revised)‘Investmentsinassociates’coversequityaccountingforjointventuresaswellasassociates.

ii) New standards and interpretations not yet adopted

ThereareanumberofaccountingstandardsandinterpretationsthathavebeenissuedbytheIASB,butwhicharenotyet

effectivefor31December,2013reporting,theseinclude:

• AmendmentstoIFRS9–FinancialInstruments(2011)-effective1January2015.TheIASBhaspublishedanamendment

to IFRS9, ‘Financial instruments’, thatdelaystheeffectivedatetoannualperiodsbeginningonorafter 1January

2015.Theoriginaleffectivedatewasforannualperiodsbeginningonorafterfrom1January2013.Thisamendment

isaresultoftheboardextending itstimelineforcompletingtheremainingphasesof itsprojecttoreplaceIAS39

(forexample,impairmentandhedgeaccounting)beyondJune2011,aswellasthedelayintheinsuranceproject.The

amendmentconfirmstheimportanceofallowingentitiestoapplytherequirementsofallthephasesoftheprojectto

replaceIAS39atthesametime.Therequirementtorestatecomparativesandthedisclosuresrequiredontransition

havealsobeenmodified.

• Amendments to IAS 32 – Financial Instruments: Presentation - effective 1 January 2014. The IASB has issued

amendments to the application guidance in IAS 32, ‘Financial instruments: Presentation’, that clarify some of the

requirementsforoffsettingfinancialassetsandfinancialliabilitiesonthestatementoffinancialposition.However,the

clarifiedoffsettingrequirementsforamountspresentedinthestatementoffinancialpositioncontinuetobedifferent

fromUSGAAP

TheGroupiscurrentlyintheprocessofevaluatingthepotentialeffectofthesestandards.

2.3 CONSOLIDATION

Thefinancialstatementsofthesubsidiariesusedtopreparetheconsolidatedfinancialstatementswerepreparedasofthe

parentcompany’sreportingdate.

Subsidiaries

TheconsolidatedfinancialstatementsoftheGroupcomprisethefinancialsstatementsoftheparententityandsubsidiaryas

at31December2013.Subsidiariesareallentities(includingstructuredentities)overwhichthegrouphascontrol.Thegroup

controlsanentitywhenthegroupisexposedto,orhasrightsto,variablereturnsfromitsinvolvementwiththeentityandhas

theabilitytoaffectthosereturnsthroughitspowerovertheentity.

ThegroupfinancialstatementsconsolidatethefinancialstatementsoftheBankanditswhollyownedsubsidiarycompany,

NIBNomineesLimited.SubsidiaryundertakingsofthosecompaniesinwhichtheGroup,directlyorindirectly,haspowerto

exercisecontrolovertheiroperations,areconsolidated.

Structuredentitiesareconsolidatedwherethegrouphascontrol.Theactivitiesofthestaffparticipationschemehavebeen

consolidatedintothefinancialstatementsoftheGroupresultingintheassetsofthestaffparticipationscheme,whicharethe

sharesofthebank,beingrecognisedinshareholdersequityasTreasuryshares(Note2.14).

Inter-company transactions, balances and unrealised gains on transactions between companies within the Group are

eliminatedonconsolidation.Unrealisedlossesarealsoeliminatedinthesamemannerasunrealisedgains,butonlytothe

extentthatthereisnoevidenceofimpairment.

ThesubsidiarieswerefullyconsolidatedfromthedatecontrolwastransferredtotheGroup.Theintegrationofthesubsidiaries

intotheconsolidatedfinancialstatementsisbasedonconsistentaccountingandvaluationmethodsforsimilartransactions

andotheroccurrencesundersimilarcircumstances.Intheseperatefinancialstatementsforthebank,theinvestmentinthe

subsidiaryiscarriedatcost.

Associates

Associates are those entities over which the Group has significant influence but not control, generally accompanying a

shareholdingbetween20%and50%ofthevotingrights.Inaddition,itincludesentitieswheretheshareholdingislessthan

20%butsuchsignificantinfluencecanbedemonstratedwiththeexistenceofrepresentationontheboardofdirectorsor

equivalentgoverningbodyoftheinvestee.Investmentinassociatesisaccountedforbytheequitymethodofaccounting.

Undertheequitymethod,theinvestmentisinitiallyrecognisedatcost,andthecarryingamountisincreasedordecreasedto

recognisetheinvestor’sshareofprofitorlossoftheinvesteeaftertheacquisitiondate.

TheGroup’sshareofpost-acquistionprofitor loss is recognised in thestatementofprofitor loss,and itsshareofpost-

acquistionmovementsinothercomprehensiveincomeisrecognisedinothercomprehensiveincomewiththecorresponding

adjustmenttothecarryingamountoftheinvestment.WhentheGroup’sshareoflossesinanassociateequalsorexceedsits

interestintheassociate,includinganyotherunsecuredreceivables,theGroupdoesnotrecognisefurtherlosses,unlessithas

incurredlegalorconstructiveobligationsormadepaymentsonbehalfoftheassociate.

TheGroupdeterminesateachreportingdatewhetherthereisanyobjectiveevidencethattheinvestmentintheassociateis

impaired.Ifthisisthecase,thegroupcalculatestheamountofimpairmentasthedifferencebetweentherecoverableamount

oftheassociateanditscarryingvalueandrecognisestheamountadjacentto“shareofprofit/(loss)ofanassociate”inthe

statementofprofitorloss.

Intheseperatefinancialstatementsforthebank,theinvestmentintheassociateiscarriedatcost.

2.4 Segment Reporting

TheGroupisaprivatecompanythathasnodebtorequitytradedinapublicmarketthereforethereisnodisclosurerequired

forsegmentreporting.

5756

2.5 Foreign currency translation

(a) Functional and presentation currency

ItemsincludedinthefinancialstatementsofeachoftheGroup’sentitiesaremeasuredusingthecurrencyoftheprimary

economic environment in which the entity operates (‘the functional currency’).The consolidated financial statements are

presentedinNaira,whichistheGroup’spresentationcurrency.Thefiguresshownintheconsolidatedfinancialstatements

arestatedinNairathousands.

(b) Transactions and balances

TransactionsinforeigncurrenciesaretranslatedintoNairaattheratesofexchangerulingatthedateofeachtransaction

(or where appropriate the rate of the related forward contracts). Monetary assets and liabilities denominated in foreign

currenciesarereportedattheratesofexchangeprevailingatthestatementoffinancialpositiondate.Anygainorlossarising

fromachangeinexchangeratessubsequenttothedateofthetransactionisincludedinthestatementofprofitorloss.

Changesinfairvalueofmonetarysecuritiesdenominatedinforeigncurrencyclassifiedasavailableforsaleareanalysed

betweentranslationdifferencesresultingfromchangesinamortisedcostofthesecurityandotherchangesinthecarrying

amountofthesecurity.Translationdifferencesrelatedtochangesinamortisedcostarerecognisedinthestatementofprofit

orloss,andotherchangesincarryingamountarerecognisedinothercomprehensiveincome.

2.6 FINANCIAL ASSETS AND LIABILITIES

InaccordancewithIAS39allfinancialassetsandliabilitieshavetoberecognisedintheconsolidatedstatementoffinancial

positionandmeasuredinaccordancewiththeirassignedcategory

2.6.1 Recognition

TheGroupinitiallyrecognisesloans,receivablesanddepositsonthedatethattheyareoriginated.Otherfinancialassetsand

liabilitiesthatincludedebtsecuritiesandassetsandliabilitiesdesignatedatfairvaluethroughprofitorlossarerecognised

onthebasisofsettlementdateaccounting.

Allfinancialinstrumentsaremeasuredinitiallyattheirfairvalueplustransactioncosts,exceptinthecaseoffinancialassets

andfinancialliabilitiesrecordedatfairvaluethroughprofitorloss.Subsequentrecognitionoffinancialassetsandliabilities

isatamortisedcostorfairvalue.

2.6.2 Classification

The classification of financial instruments depends on the purpose and management’s intention for which the financial

instrumentswereacquiredandtheircharacteristics.Seeaccountingpolicies2.6.10to2.6.16.

2.6.3 Derecognition

TheGroupderecognisesafinancialassetwhenthecontractualrightstothecashflowsfromtheassetexpire,orittransfers

therightstoreceivethecontractualcashflowsonthefinancialassetinatransactioninwhichsubstantiallyalltherisksand

rewardsofownershipofthefinancialassetaretransferred.Any interest intransferredfinancialassetsthat iscreatedor

retainedbytheGroupisrecognisedasaseparateassetorliability.

TheGroupderecognisesafinancialliabilitywhenitscontractualobligationsaredischargedorcancelledorexpire.

TheGroupentersintotransactionswherebyittransfersassetsrecognisedonitsstatementoffinancialposition,butretains

eitherallrisksandrewardsofthetransferredassetsoraportionofthem. Ifallorsubstantiallyallrisksandrewardsare

retained,thenthetransferredassetsarenotderecognisedfromthestatementoffinancialposition.Transfersofassetswith

retentionofallorsubstantiallyallrisksandrewardsinclude,forexample,securedborrowingandrepurchasetransactions.

SuchassetsarereportedasAssetspledgedascollateralinthestatementoffinancialposition.

2.6.4 Offsetting of financial assets and liabilities

Financialassetsandliabilitiesareoffsetandthenetamountreportedonthestatementoffinancialpositionwhenthereisa

legallyenforceablerighttoset-offtherecognisedamountandthereisanintentiontosettleonanetbasis,ortorealisethe

assetandsettletheliabilitysimultaneously.

2.6.5 Sale and repurchase agreements

Securitiessoldsubjecttorepurchaseagreements(‘repos’)arereclassifiedinthefinancialstatementsasassetspledgedas

collateralwhenthetransfereehastherightbycontractorcustomtosellorrepledgethecollateral;thecounterpartyliability

isincludedindepositsfrombanksordepositsfromcustomers,asappropriate.Securitiespurchasedunderagreementsto

resell (‘reverse repos’) are recorded as loans and advances to other banks or customers, as appropriate. The difference

betweensaleandrepurchaseprice is treatedas interestandaccruedover the lifeof theagreementsusingtheeffective

interestmethod.Securitieslenttocounterpartiesarealsoretainedinthefinancialstatements.

2.6.6 Amortised cost measurement

Theamortisedcostofafinancialassetorliabilityistheamountatwhichthefinancialassetorliabilityismeasuredatinitial

recognition,minusprincipalrepayments,plusorminusthecumulativeamortisationusingtheeffectiveinterestmethodof

anydifferencebetweentheinitialamountrecognisedandthematurityamount,minusanyreductionforimpairment.

2.6.7 Fair value measurement

Fairvalueisthepricethatwouldbereceivedtosellanassetorpaidtotransferaliabilityinanorderlytransactionbetween

marketparticipantsatthemeasurementdate.

Thefairvalueoftradingassets,financialassetsheldatfairvalueandavailable-for-saleassetsarebasedonquotedmarket

prices,excludingtransactioncosts.Ifaquotedmarketpriceisnotavailableforthefinancialassets,thefairvalueisestimated

usingpricingmodelsordiscountedcashflowtechniques.

Wherediscountedcashflowtechniquesareused,estimatedfuturecashflowsarebasedonmanagement’sbestestimatesand

thediscountrateisamarket-relatedrateatthereportingdateforafinancialassetwithsimilartermsandconditions.Where

pricingmodelsareused,inputsarebasedonmarketrelatedmeasuresatthereportingdate.

2.6.8 Identification and measurement of impairment of financial assets

i) Assets carried at amortised cost

AteachreportingdatetheGroupassesseswhetherthereisobjectiveevidencethatfinancialassetsareimpaired.Financial

assetsareimpairedwhenobjectiveevidencedemonstratesthatalosseventhasoccurredaftertheinitialrecognitionofthe

asset,andthatthelosseventhasanimpactonthefuturecashflowsoftheassetthatcanbeestimatedreliably.

TheGroupconsidersevidenceof impairmentatbothaspecificassetandcollectiveasset level.All individuallysignificant

financialassetsareassessedforspecific impairment.Allsignificantassets foundnottobespecifically impairedarethen

collectively assessed for any impairment that could be incurred but not yet identified. Assets that are not individually

significantarethencollectivelyassessedforimpairmentbygroupingtogetherfinancialassets(carriedatamortisedcost)

withsimilarriskcharacteristics.

Objectiveevidencethatfinancialassets(includingequitysecurities)areimpairedcanincludesignificantfinancialdifficulty,

default on the facility or probability that the obligor will enter bankruptcy, the disappearance of an active market for a

security,orotherobservabledatarelatingtoagroupofassetssuchasadversechangesinthepaymentstatusofborrowers

orissuersinthegroup,oreconomicconditionsthatcorrelatewithdefaultsinthegroup.

InassessingcollectiveimpairmenttheGroupusesstatisticalmodellingofhistoricaltrendsoftheprobabilityofdefault,timing

ofrecoveriesandtheamountoflossincurred,adjustedformanagement’sjudgementastowhethercurrenteconomicand

creditconditionsaresuchthattheactuallossesarelikelytobegreaterorlessthansuggestedbyhistoricalmodelling.The

collectiveimpairmentisdeterminedonaportfoliobasisbasedonthehistorical lossexperienceforassetswithcreditrisk

characteristicssimilartothoseintheGroup.Theloanimpairmentprovisionwouldbebasedonrisk-ratingofobligorandloss

normsattachedtoeachrisk-rating.Thelossnormwouldhavebeenstatisticallyderivedfromhistoricaldata.

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Impairmentlossesonassetscarriedatamortisedcostaremeasuredasthedifferencebetweenthecarryingamountofthe

financialassetsandthepresentvalueofestimatedcashflowsdiscountedattheassets’originaleffectiveinterestrate.Losses

arerecognisedinstatementofprofitorlossandreflectedinanallowanceaccountagainstloansandadvances.Intereston

theimpairedassetcontinuestoberecognisedthroughtheunwindingofthediscount.

If,inasubsequentperiod,theamountoftheimpairmentlossdecreasesandthedecreasecanberelatedobjectivelytoan

eventoccurringaftertheimpairmentwasrecognised(suchasanimprovementintheobligor’screditrating),thepreviously

recognisedimpairmentlossisreversedbyadjustingtheallowanceaccount.Theamountofthereversalisrecognisedinthe

statementofprofitorloss.

ii) Assets classified as available-for-sale

Impairment losses on available-for-sale investment securities are recognised by transferring the difference between the

amortisedacquisitioncostandcurrentfairvalueoutofequitytothestatementofprofitorloss.

Inthecaseofequityinvestmentsclassifiedasavailable-for-sale,asignificantorprolongeddeclineinthefairvalueofthe

securitybelowitscost isobjectiveevidenceof impairmentresulting intherecognitionofan impairment loss. Ifanysuch

evidenceexistsforavailable-forsalefinancialassets,thecumulativeloss–measuredasthedifferencebetweentheacquisition

cost and the current fair value, less any impairment loss on that financial asset previously recognised in the statement

ofprofitor loss – is removed fromequityandrecognised instatementofprofitor loss. Impairment losses recognised in

statementofprofitorlossonequityinstrumentsarenotreversed.

If,inasubsequentperiod,thefairvalueofainvestmentsecuritiesclassifiedasavailable-for-saleincreasesandtheincrease

canbeobjectivelyrelatedtoaneventoccurringaftertheimpairmentlosswasrecognisedinstatementofprofitorloss,the

impairmentlossshallbereversed,withtheamountofthereversalrecognisedinthestatementofprofitorloss.

However, any subsequent recovery in the fair value of an impaired available-for-sale investment security is recognised

directlyinequity.

2.6.9 Regulatory risk reserve

IncompliancewiththePrudentialGuidelinesforLicensedBanks,theGroupassessesqualifyingfinancialassetsusingthe

guidanceunderthePrudentialGuidelines.Theseapplyobjectiveandsubjectivecriteriatowardsprovidingforlossesinrisk

assets.Assetsareclassedasperformingornon-performing.Non-performingassetsare furtherclassedasSubstandard,

DoubtfulorLostwithattendantprovisionasperthetablebelowbasedonobjectivecriteria.

Classification % Provided Basis

Substandard 10% Interestand/orprincipaloverdueby90daysbutlessthan180days.

Doubtful 50% Interestand/orprincipaloverduebymorethan180daysbutlessthan365days.

Lost 100% Interestand/orprincipaloverduebymorethan365days.

Amoreacceleratedprovisionmaybedoneusingthesubjectivecriteria.A1%provisionistakenonallriskassetsnotspecifically

provisioned.

TheresultsoftheapplicationofPrudentialGuidelinesandthe impairmentdeterminedfortheseassetsunder IAS39are

compared.TheIAS39determinedimpairmentchargeisalwaysincludedinthestatementofprofitorloss(Note18.3).Where

thePrudentialGuidelinesprovisionisgreater,thedifferenceisappropriatedfromRetainedEarningsandincludedinanon-

distributablereservecalledStatutoryCreditReserve.WheretheIAS39impairmentisgreater,noappropriationismadeand

theamountoftheIAS39impairmentisrecognisedinthestatementofprofitorloss.

Insubsequentperiods,reversalsoradditionalappropriationsaremadebetweentheStatutoryCreditReserveandRetained

EarningstomaintaintotalprovisionsatthelevelsexpectedbytheRegulator.

2.6.10 Cash and cash equivalents

Cashandcashequivalentsincludenotesandcoinsonhand,unrestrictedbalancesheldwithcentralbanksandhighlyliquid

financialassetswithoriginalmaturitiesoflessthanthreemonths,whicharesubjecttoinsignificantriskofchangesintheir

fairvalue,andareusedby theGroup in themanagementof itsshort-termcommitments.Cashandcashequivalentsare

carriedatamortisedcostinthestatementoffinancialposition

2.6.11 Financial assets and liabilities classified as held for trading

TradingassetsandliabilitiesarethoseassetsandliabilitiesthattheGroupacquiresorincursprincipallyforthepurposeof

sellingorrepurchasinginthenearterm,orholdsaspartofaportfoliothatismanagedtogetherforshort-termprofit.

Tradingassetsandliabilitiesareinitiallyrecognisedandsubsequentlymeasuredatfairvalueinthestatementoffinancial

positionwithtransactioncostsrecognisedinstatementofprofitorloss.Allchangesinfairvaluearerecognisedaspartofnet

tradingincomeinstatementofprofitorloss.

2.6.12 Loans and receivables

Loansandadvancesarenon-derivativefinancialassetswithfixedordeterminablepaymentsthatarenotquotedinanactive

marketandthattheGroupdoesnotintendtosellimmediatelyorinthenearterm.

When the Group is the lessor in a lease agreement that transfers substantially all of the risks and rewards incidental to

ownership of an asset to the lessee, the arrangement is classified as a finance lease and a receivable equal to the net

investmentintheleaseisrecognisedandpresentedaspartofloansandadvancestocustomers.

Loansandadvancesareinitiallymeasuredatfairvalueplusincrementaldirecttransactioncosts,andsubsequentlymeasured

attheiramortisedcostusingtheeffectiveinterestmethod.

2.6.13 Available-for-sale

Available-for-sale investments are non-derivative investments that are not designated as any other category of financial

assets.Allavailable-for-saleinvestmentsarecarriedatfairvalue.

Interestincomeisrecognisedinstatementofprofitorlossusingtheeffectiveinterestmethod.Dividendincomeisrecognised

instatementofprofitorlosswhentheGroupbecomesentitledtothedividend.Foreignexchangegainsorlossesonavailable-

for-saledebtinvestmentsecuritiesarereclassifiedinstatementofprofitorloss.

Other fairvaluechangesare recogniseddirectly inothercomprehensive incomeuntil the investment is soldor impaired

whereuponthecumulativegainsandlossespreviouslyrecognisedinothercomprehensiveincomearerecognisedtostatement

ofprofitorlossasareclassificationadjustmentfornon-equtysecurities,whiletherewillbenoreclassificationadjustmentto

profitorlossinthecaseofequitysecurities

Anon-derivativefinancialassetmaybereclassifiedfromtheavailable-for-salecategorytotheloansandreceivablecategory

ifitotherwisewouldhavemetthedefinitionofloansandreceivablesandiftheGrouphastheintentionandabilitytoholdthat

financialassetfortheforeseeablefutureoruntilmaturity.

2.6.14 Derivative financial instruments

Derivative financial instruments are recognised initially at fair value on the date which the derivative contract is entered

intoandsubsequentlyre-measuredattheirfairvalue.Fairvaluesareobtainedfromquotedmarketpricesinactivemarkets,

includingrecentmarkettransactionsandvaluationtechniques.Allderivativesarecarriedasassetswhenfairvalueispositive

andasliabilitieswhenfairvalueisnegative.Changesinfairvaluearerecognisedimmediatelyinthestatementofprofitorloss.

2.6.15 Non-derivative Financial liabilities

Financialliabilitiesareinitiallymeasuredatfairvaluenetoftransactioncostsattradedate.Subsequently,theyaremeasured

atamortizedcostusingtheeffectiveinterestratemethod.

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2.6.16 Reconciliation of Financials Statement line items to IAS 39 categories

ThetablebelowshowstheclassificationoftheGroup’sFinancialStatementlineitemstodifferentcategoriesinlinewithIAS

39provisions.

Category (as defined by IAS 39) Classes as determined by the Group

Financialassets

Financialassetsatfairvaluethroughprofitorloss

TradingAssets DebtSecurities

Derivativefinancialinstruments

Loansandreceivables

CashandbalanceswithCentralBankofNigeria

LoansandadvancestoBanks

Loansandadvancestocustomers

OtherAssets

AvailableforsaleInvestmentSecurites

DebtSecurities

ListedEquitysecurities

UnlistedEquitysecurities

Assetspledgedascollateral DebtSecurities

Financialliabilities

Financialliabilitiesatfairvaluethroughprofitandloss

Derivativefinancialinstruments

Financialliabilitiesatamortisedcost

DepositfromBanks

DepositsfromCustomers

Otherborrowedfunds

Otherliabilities

2.7 Revenue recognition

Interest income and expense

using theeffective interestmethod.Theeffective interest rate is the rate thatexactlydiscounts theexpectedestimated

futurecashpaymentsandreceiptsthroughtheexpectedlifeofthefinancialassetorliability.Feesanddirectcostsrelating

toloanorigination,refinancingorrestructuringandtoloancommitmentsaredeferredandamortisedtointerestearnedon

loansandadvancesusingtheeffectiveinterestmethod.

Fees and commission income

Feesandcommissionsaregenerallyrecognisedonanincurredbasiswhentherelatedservicesareprovidedoronexecution

ofasignificantact.Feesandcommissionsarisingfromnegotiatingorparticipatinginthenegotiationofatransactionfroma

thirdpartysuchaslettersofcredit,cashclearingarerecognisedonanaccrualbasisastheserviceisprovided.Portfolioand

othermanagementadvisoryandservicefeesarerecognisedbasedontheapplicableservicecontracts,usuallyonatime-

apportionatebasis.Custodyrelatedfeesarerecognizedovertheperiodinwhichtheserviceisprovided.

Net income from financial instruments held for trading at fair value through profit and loss

Net incomeon itemsat fairvalue throughprofitand losscomprisesofallgains less lossesrelatedto tradingassetsand

liabilities and financial instruments designated at fair value, and include all realized and unrealized fair value changes,

togetherwithrelatedinterestandforeignexchangedifferences.

Dividend income

Dividends are recognised in Net Investment income in the statement of profit or loss when the entity’s right to receive

paymentisestablished.

2.8 Property, plant and equipment

Landandbuildingscomprisemainlyheadofficeandbranchoffices.Allproperty,plantandequipmentusedbytheparentor

itssubsidiaryisstatedathistoricalcostlessdepreciation.Historicalcostincludesexpenditurethatisdirectlyattributableto

theacquisitionoftheitems.Subsequentcostsareincludedintheasset’scarryingamountorarerecognisedasaseparate

asset,asappropriate,onlywhenitisprobablethatfutureeconomicbenefitsassociatedwiththeassetwillflowtotheGroup

andthecostoftheassetcanbemeasuredreliably.Allotherrepairsandmaintenancearechargedtothestatementofprofit

orlossduringthefinancialperiodinwhichtheyareincurred.

Landisnotdepreciated.Depreciationofassetsiscalculatedusingthestraight-linemethodtoallocatethecostofproperty

andequipmenttotheirresidualvaluesovertheirestimatedusefullives,asfollows:

-Leaseholdimprovements: Overtheleaseperiodorusefullifewhicheverisshorter

-Building 50years

-Furnitureandequipment 5years

-Computerequipment 3years

-Motorvehicles 4years

Depreciationbeginswhenanassetisavailableforuseandceasesattheearlierofthedatethattheassetisderecognized

orclassifiedasheldforsaleinaccordancewithIFRS5.Anon-currentassetordisposalgroupisnotdepreciatedwhileitis

classifiedasheldforsale

Capitalwork-in-progressisnotdepreciated.Uponcompletionitistransferredtotherelevantassetcategory.

Theassets’residualvaluesandusefullivesarereviewed,andadjustedifappropriate,attheendofeachreportingperiod.

Assetsarereviewedforimpairmentwhenevereventsorchangesincircumstancesindicatethatthecarryingamountmaynot

berecoverable.

Gainsand lossesondisposalsaredeterminedbycomparingproceedswithcarryingamount.Theseare included in ‘other

operatingincome’inthestatementofprofitorloss.

2.9 Intangible assets

Computer software is treated as an intangible asset when the purchased software is not an integral part of the related

hardware.Costsassociatedwithmaintainingcomputersoftwareprogrammesarerecognisedasanexpenseasincurred.The

costsincurredtoacquireandbringtousespecificcomputersoftwarearecapitalised.Thecostsareamortisedonastraight

linebasisovertheexpectedusefullives,whichdoesnotexceedthreeyears.

Computerdevelopmentcoststhataredirectlyassociatedwiththeproductionofidentifiableanduniquesoftwareproducts

thatwillprobablygenerateeconomicbenefitsinexcessofitscostsarecapitalised.Thecostsareamortisedonastraightline

basisovertheexpectedusefullives,whichdoesnotexceedthreeyears.

Othercostsassociatedwithmaintainingsoftwarearerecognisedasanexpenseasincurredinthestatementofprofitorloss.

2.10 Impairment of non-financial assets

Impairmentlossesarerecognisedinthestatementofprofitorloss.Impairmentlossesrecognisedinrespectofassetsare

allocatedtoreducethecarryingamountoftheassets.

Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has

decreasedornolongerexists.Animpairmentlossisreversediftherehasbeenachangeintheestimatesusedtodetermine

therecoverableamount.Animpairmentlossisreversedonlytotheextentthattheasset’scarryingamountdoesnotexceed

thecarryingamountthatwouldhavebeendetermined,netofdepreciationoramortisation,ifnoimpairmentlosshadbeen

recognised.

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2.11 Provisions

Aprovisionisrecognisedif,asaresultofapastevent,theGrouphasapresentlegalorconstructiveobligationthatcanbe

estimatedreliablyanditisprobablethatanoutflowofeconomicbenefitswillberequiredtosettletheobligation.Provisions

aredeterminedbythepresentvalueoftheexpendituresexpectedtosettletheobligationusingapre-taxratethatreflects

currentmarketassessmentsofthetimevalueofmoneyand,whereappropriate,therisksspecifictotheliability.

2.12 Income taxation

Current income tax

Thetaxexpensefortheperiodcomprisescurrentanddeferredincometax.Taxisrecognisedinstatementofprofitorloss,

excepttotheextentthatitrelatestoitemsrecognisedinothercomprehensiveincomeordirectlyinequity.Inthiscase,the

taxisalsorecognisedinothercomprehensiveincomeordirectlyinequityrespectively.

Thecurrentincometaxchargeiscalculatedonthebasisoftaxlawsenactedorsubstantivelyenactedatthereportingdate.

Thedirectorsperiodicallyevaluatepositionstakenintaxreturnswithrespecttosituationsinwhichapplicabletaxregulation

issubjecttointerpretation.Theyestablishprovisionswhereappropriate,onthebasisofamountsexpectedtobepaidtothe

taxauthorities.

Deferred income tax

Deferredtaxarisesfromtemporarydifferencesintherecognitionofitemsforaccountingandtaxpurposesandiscalculated

usingtheliabilitymethod.Deferredtaxisprovidedontimingdifferences,whichareexpectedtoreverseintheforeseeable

futureattheratesoftaxlikelytobeinforceatthetimeofreversal.Deferredincometaxisdeterminedusingtaxrates(and

laws) thathavebeenenactedorsubstantiallyenactedby thereportingdateandareexpectedtoapplywhentherelated

deferredincometaxassetisrealisedorthedeferredincometaxliabilityissettled.

Deferredincometaxassetisrecognisedonlytotheextentthatitisprobablethatfuturetaxableprofitwillbeavailableagainst

whichthetemporarydifferencescanbeutilised.

Deferredincometaxassetsandliabilitiesareoffsetwhenthereisalegallyenforceablerighttooffsetcurrentincometax

assetsagainstcurrentincometaxliabiltitesandwhenthedeferredincometaxesassetsandliabilitiesrelatetoincometaxes

leviedbythesametaxationauthorityoneitherthesameentityordifferenttaxableentitieswherethereisanintentionto

settlethebalancesonanetbasis.

Deferredtaxrelatedtofairvaluemeasurement,afterinitialrecognition,ofavailable-for-salesecurities,isrecognisedinother

comprehensiveincome.

2.13 Employee benefits

Defined contribution scheme

TheGroupoperatesadefinedcontributorypensionscheme.TheschemeisfullyfundedandismanagedbylicensedPension

FundAdministrators.MembershipoftheschemeisautomaticforanemployeeuponcommencementofdutiesattheGroup.

TheemployeeandtheGroupcontribute7.5%eachoftheemployee’sannualbasicsalaryaswellashousingandtransport

allowancestothescheme.TheGroup’scontributionstothisschemearechargedtothestatementofprofitor loss inthe

periodtowhichtheyrelate.

2.14 Share Capital

Dividend on ordinary shares

DividendonordinarysharesisappropriatedfromretainedearningsintheyearitisapprovedbytheGroup’sshareholders.

Dividendpershareiscalculatedbasedonthedeclareddividendduringtheyearandthenumberofsharesinissueatthedate

ofthedeclarationandqualifyingfordividend.

DividendforthecurrentyearthatisapprovedbytheDirectorsafterthestatementoffinancialpositiondateisdisclosedin

thesubsequenteventsnotetothefinancialstatements.

DividendproposedbyDirectors’butnotyetapprovedbymembersisdisclosedinthefinancialstatementsinaccordance

withtherequirementsoftheCompaniesandAlliedMattersActofNigeria.

Treasury shares

WheretheBankoranymemberoftheGrouppurchasestheBank’ssharecapital,theconsiderationpaid,ifany,isdeducted

fromtheshareholdersequityastreasurysharesuntiltheyarecancelledordisposed,asdisclosedinnote35.2.Wheresuch

sharesaresubsequentlysoldorreissued,anyconsiderationreceivedisincludedinshareholdersequity

2.15 Contingent assets and liabilities

Contingentassets

Contingentassetisapossibleassetthatarisesfrompasteventsandwhoseexistencewillbeconfirmedonlybytheoccurrence

ornonoccurrenceofoneormoreuncertainfutureeventsnotwhollywithinthecontroloftheGroup.Contingentassetsare

disclosedinthefinancialstatementswhentheyarise.

Contingentliabilities

Contingentliabilityisaprobableobligationthatarisesfrompasteventsandwhoseexistencewillbeconfirmedonlybythe

occurrenceornon-occurrenceofoneormoreuncertainfutureeventsnotwhollywithinthecontroloftheGroup.Contingent

liabilitiesaredisclosedinthefinancialstatements.Howevertheyarerecognized,ifitisprobablethatanoutflowofeconomic

resourceswillberequiredtosettletheobligationandtheamountcanbereliablyestimated.

Financialguarantees

FinancialguaranteesarecontractsthatrequiretheGrouptomakespecifiedpaymentstoreimbursetheholderfora loss

it incursbecauseaspecifieddebtor fails tomakepaymentwhendue inaccordancewith the termsofadebt instrument.

Financialguaranteeliabilitiesarerecognisedinitiallyattheirfairvalue,andtheinitialfairvalueisamortisedoverthelifeof

thefinancialguarantee.Thefinancialguaranteeliabilityissubsequentlycarriedatthehigherofthisamortisedamountand

thepresentvalueofanyexpectedpaymentwhenapaymentundertheguaranteehasbecomeprobable.Financialguarantees

areincludedwithinotherliabilities.Thefeeincomeearnedisrecognisedonastraight-linebasisoverthelifeoftheguarantee.

2.16 Comparatives

Except when a standard or an interpretation permits or requires otherwise, all amounts are reported or disclosed with

comparativeWhereIAS8applies,comparativefigureshavebeenadjustedtoconformwithchangesinpresentationinthe

currentyear.

3 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including

expectationsoffutureeventsthatarebelievedtobereasonableunderthecircumstances.

Thegroupmakesestimatesandassumptionsconcerningthefuture.Theresultingaccountingestimateswill,bydefinition,

seldomequal therelatedactual results.Theestimatesandassumptionsthathaveasignificantriskofcausingamaterial

adjustmenttothecarryingamountsofassetsandliabilitieswithinthenextfinancialyearareaddressedbelow.

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3.1. Impairment losses on loans and advances

TheGroupreviewsitsloanportfoliostoassessimpairmentperiodically.Indeterminingwhetheranimpairmentlossshouldbe

recordedinstatementofprofitorloss,theGroupmakesjudgementsastowhetherthereisanyobservabledataindicatingan

impairmenttrigger,followedbymeasurabledecreaseintheestimatedfuturecashflowsfromtheportfolioofloans,beforethe

decreasecanbeidentifiedwiththatportfolio.Thisevidencemayincludeobservabledatathatindicatessignificantfinancial

difficulty,defaultonthefacilityorprobabilitythattheobligorwillenterbankruptcy,orotherobservabledatarelatingtoa

groupofassetssuchasadversechangesinthepaymentstatusofborrowersorissuersinthegroup,oreconomicconditions

thatcorrelatewithdefaultsinthegroup.TheGroupusesestimatesbasedonhistoricallossexperienceforassetswithcredit

riskcharacteristicsandobjectiveevidenceofimpairmentsimilartothoseintheportfolio.Theloanimpairmentprovisionwas

basedonriskratingofobligorandlossnormsattachedtoeachriskrating.Thelossnormsarestatistisicallyderivedfrom

historicaldataandwerethesetodifferby+/-1basispoint,theimpairmentlosswouldbeN9,424,533higherorlower.Note18.3

detailsthemovementintheimpairmentprovisiononloansandadvancesfortheyear.

3.2. Impairment losses of available-for-sale equity investments

TheGroupdeterminesthatavailable-for-saleequityinvestmentsareimpairedwhentherehasbeenasignificantorprolonged

declineinthefairvaluebelowitscost.Thisdeterminationofwhatissignificantorprolongedrequiresjudgement.Inmaking

thisjudgement,theGroupevaluatesamongotherfactors,thedeteriorationinthefinancialhealthoftheinvestee,industry

andsectorperformance,changesintechnology,andoperationalandfinancingcashflows.

Had all the declines in fair value below cost for all equity investments been recognised in total, the Group would have

recognisedanadditionalN10,403,346lossinits31December2013financialstatements.

3.3. Fair value of financial instruments

Thefairvalueoffinancialinstrumentswherenoactivemarketexistsorwherequotedpricesarenototherwiseavailableare

determinedbyusingvaluationtechniques.Inthesecases,thefairvaluesareestimatedfromobservabledatainrespectof

similarfinancialinstrumentsorusingvaluationmodels.Wheremarketobservableinputsarenotavailable,theyareestimated

based on appropriate assumptions. Where valuation techniques (for example, models) are used to determine fair values,

theyarevalidatedandperiodicallyreviewedbyqualifiedpersonnelindependentofthosethatsourcedthem.Allmodelsare

certifiedbeforetheyareused,andmodelsarecalibratedtoensurethatoutputsreflectactualdataandcomparativemarket

prices.Totheextentpractical,modelsuseonlyobservabledata;however,areassuchascreditrisk(bothowncreditriskand

counterpartyrisk),volatilitiesandcorrelationsrequiremanagementtomakeestimates.Note4.2.2detailsfurthersensitivity

analysisonthenon-tradingportfolio.

Thefairvalueofinvestmentsecuritiesinnon-quotedequitysecuritiesisbasedonamodelthattakesobservabledatawith

significant unobservable adjustments or assumptions required. Were these unobservable adjustments or assumptions to

differby+/-100basispoints,thechangeinfairvaluewouldbeN14,171,000higherorlower.Note4.5.2detailsthemovement

inInvestmentsecuritiesunder.Level3thatrepresentthefairvalueofnon-quotedequitysecuritiesfortheyear.

4. FINANCIAL RISK MANAGEMENT

Theriskmanagementframeworkhasasitsfoundationonarobustsetofpolicies,proceduresandprocessescoveringthe

followingbroadcategoriesofrisk:Creditrisk,MarketriskandLiquidityrisk.

Theriskmanagementpoliciesserveasthebasisforriskidentificationandanalysisinherentintheproductofferingaswellas

operatingenvironment,settingofappropriaterisklimitsandcontrolsandmonitoringadherencetolimits.Riskmanagement

policiesandsystemsarereviewedregularlytoreflectchangesinmarketconditions,productsandservicesoffered.Business

managersandfunctionalheadsareacountableforrisksintheirbusinessesandfunctions.TheGroup,throughitstraining,

managementstandardsandprocedures,aims todevelopadisciplinedandconstructivecontrolenvironment, inwhichall

employeesunderstandtheirrolesandobligations.

Enterprise risk review

Thediversityofcustomers,products,andbusinessstrategiesatCitibankNigeriaLimitedrequiresthatwehaveawell-defined,

riskmanagementframeworktoidentify,analyze,originate,monitorandreportonacceptablerisktakingactivitieswithinpre-

definedthresholds.

The Group’s risk management function works with the business towards the goal of taking intelligent risk with shared

responsibility, without forsaking individual accountability and mitigating the potential of losses in risk activities under 3

broad categories: Credit risk, Liquidity and Market risk. Senior Business Management‘s objectives (budgets, portfolios

and investments) must be prudent, reflecting their view of risks and rewards arising from market conditions and should

dynamicallyadjustthesestrategiesandbudgetstofitchangingenvironments.

Governance structure

ThekeygovernancestructureincludestheBoardofDirectors,CreditCommittees,RiskManagementcommitteeandsenior

managementcommitteeswhichspecificallyfocusonthebroadriskcategoriesstatedabove.

The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management

framework.

TheBoardCreditCommitteehastheresponsibilityforapprovalofcreditfacilities,delegationofapprovallimitsandratification

ofManagementCredit committee limitsas recommendedby theCountryRiskManager.AllBoardcommitteeshaveboth

executiveandnon-executivemembersandreportregularlytotheboardofdirectorsontheiractivities.

AssetandLiabilityCommittee(ALCO)isresponsibleforthemarketriskmanagementandoversightforthebank.TheALCO

establishesandimplementsliquidityandpriceriskmanagementpolicies;approvestheannualliquidityandfundingplans;

approves and reviews the liquidity and price risk limits; monitors compliance with regulatory risk capital and the capital

managementproces.

Excessive risk concentration

Concentrationsarisewhenanumberofcounterpartiesareengagedinsimilarbusinessactivities,oractivitiesinthesame

geographicalregion,orhavesimilareconomicfeaturesthatwouldcausetheirabilitytomeetcontractualobligationstobe

similarlyaffectedbychangesineconomic,politicalorotherconditions.Concentrationsindicatetherelativesensitivityofthe

Group’sperformancetodevelopmentsaffectingaparticularindustryorgeographicallocation.Inordertoavoidexcessive

concentrationsofrisk,theGroup’spoliciesandproceduresincludespecificconcentrationlimitsbasedontheGroup’soveral

riskcapacity,capitalconsiderationsandevaluationofinternalandexternalenvironments.Identifiedconcentrationsofcredit

risksaremonitored,controlledandmanagedaccordingly.

4.1 Credit Risk

CreditriskistheriskoffinanciallosstotheGroupifacustomerorcounterpartytoafinancialinstrumentfailstomeetits

contractualobligations.ThisarisesprincipallyfromtheGroup’sloansandadvancestocustomersandbanks,andinvestment

debt securities. For risk management reporting purposes the bank considers and consolidates all elements of credit risk

exposure.

4.1.1 Management of Credit Risk

ThecreditpolicyisthebedrockofthecreditriskmanagementandispredicatedontheGroup’sbusinessstrategyandreturn

objective through well predefined target market, risk acceptance criteria and stress testing. Based on Board approval,

independentriskinconjuctionwiththebusinessunitsetandmonitorlimits.

Tomanagethecreditprocesswithpredictableresults,theGrouphasadyamicandinteractivethreephasedapproach:

i.Portfoliostrategyandplanning:WheretheGroupdefinesdesiredfinancialresultsandstrategiesrequiredtoachievethose

results.TargetmarketispartofthestrategythatidentifiestheacceptableprofileofcustomersandtheproductstheGroup

proposetooffer;

6766

ii)CreditOriginationandMaintenance:WheretheGroupcreatesandmaintainstransactionsandportfolioswithcharacteristics

thatareconsistentwithinstitutionalstrategies;and

iii)PerformanceAssessmentandReporting:WheretheGroupmonitorstheperformanceforcontinualimprovement.System

captureofcredit informationanddocumentationreview isanothercriticalattributeoffinancialanalysiswhichfacilitates

creditmonitoringdonebothonobligorandportfoliobasis.

Methodology for risk rating

TheRiskRatingProcessistheend-to-endprocessforderivingObligorRiskRating(ORR’s)andFacilityRiskRating(FRR’s).

Theseratingsarederivedaspartoftheoverallriskratingprocessthatinvolvestheuseofriskratingmodels,supplemental

guidelines,supportadjustments,collateraladjustments,processcontrols,aswellasanyotherdefinedprocessesthatthe

GroupundertakesinordertoarriveatORR’sandFRR’s.Therequiredinputsintothemodelforderivingtheriskratingare

theobligor’sfinancialstatements.Themodelsarestatisticalmodels,whicharerevalidatedperiodicallybytheCreditand

Operational Risk Analytics Group of Citigroup, which is based in New York. The revalidation had no impact but ensured

consistencyoftheratingprocess.

TheObligorRiskRating (ORR)represents theprobability thatanobligorwilldefaultwithinaone-year timehorizon.Risk

ratingsforobligorsareassignedonascaleof1to10,withsub-grades,where‘1’isthebestqualityriskand‘7’istheworstfor

performingandaccruingobligorsthatarenotindefault.ORR“9”and“10”ratingcategoriesindicatethattheobligorisin

default(ORR“8”isapplicableonlytoadverseclassificationsresultingsolelyfromcross-borderevents).

TheFacilityRiskRating(FRR)approximatesa‘LossNorm’foreachfacility,andistheproductoftwocomponents:theDefault

ProbabilityoftheObligor,i.e.thefinalORR,andtheLossGivenDefault(‘LGD’).FRR’sareassignedonascaleof1to10,with

sub-grades,where ‘1’ isthebestqualityriskand‘7’ istheworstforperformingoraccruingfacilities.The9and10rating

categoriesindicatefacilitiesthathavebeenplacedonnon-accrualstatus.

TheObligorLimitRating(OLR)representsalonger-term(beyondoneyear)viewofanobligor’screditquality.TheOLRis

derivedfromthefinalORRandconsidersarangeoffactors,suchasqualityofmanagementandstrategy,natureofindustry,

andregulatoryenvironment,amongotherfactors.

Aspartoftheriskmanagementprocess,theGroupassignsnumericriskratingstoitsObligorsbasedonquantitativeand

qualitativeassessmentoftheobligorandfacility.Theseriskratingsarereviewedatleastannuallyormoreoftenifmaterial

eventsrelatedtotheobligororfacilitywarrant.

4.1.2 Credit Risk Measurement

TheGroup’screditfacilitiesreflectthepotentialmaximumcreditexposureorlosstocounter-partyforaparticularproduct

and exposure type. In furtherance of this objective, we consistently ensure the Group’s business strategy and exposure

appetitearealigned.ThekeyattributesofourcreditpolicyarealsoconsistentwiththeCitigroupInstitutionalClientsGroup

(ICG) Principles and Policy Framework. This policy framework dictates best international practices in Risk Management,

includingcreditrisk.

Toenableconsistentmonitoringofexposureandrisk:

i)Allcreditexposuresmustbecapturedinthecreditsystems-irrespectiveofabsolutesizeofexposure,duration,location,

counterparty,authorizationlevelobtainedorperceivedeconomicrisk.

ii) Credit facility amounts must capture exposure (the maximum potential for loss to an obligor or counterparty). Risk

adjustmentsarereflectedforobligorlimitsandinotherreporting.

iii)Allpotentialcreditrelationshipsshouldhaveaproperaccountopenedinthenameoftheobligor.Forcurrentcreditsystem

integration,theclientshouldhaveaGlobalFinanceCustomerIdentifier(GFCID)created

iv)Everybusinessunitmustmaintainadequatecontrolstoensurecompliancewithallfacilitytermsandconditionsestablished

inconjunctionwithIndependentRisk.

v)Singlenametriggerspreventexcessiveconcentrationsoflosstoasinglename,andtogetherformthebasisforcompliance

withregulatoryrulessuchaslegallendinglimits.

vi)Obligorlimitsarethebasisforcreditportfoliomanagerstopreventconcentrationsoflosstoanyoneobligororrelationship.

BusinessunitsmustescalateanypotentialbreachofalimitasprovidedforintheCitigroupICGRiskManual.

vii)Creditfacilitiesandtheabilitytomanagetheexposureshouldbeinplacepriortoexecutinganynewbusiness.

viii)Allcreditrelationshipsshouldbereviewedannually,ataminimum,unlessotherwisedulyextended,whereappropriate.

ix)RiskratingsmustbeestablishedforallobligorsandfacilitiesusingtheCitigroupapprovedriskratingmethodology.

Credit exposure

Creditriskismeasuredbythetotalfacilitiesandexposuretotheobligorwhichconsistofoutstandingandunusedcommitted

facilityamounts.FinancialassetsandotherfinancialfacilitiesconstitutetheprimaryofferingoftheGroup.Theofferingis

basedonadetailedcreditreviewprocesswhichinvolvesanalysisofbothquantitativeandqualitativefactors.Thisincludes

riskratingoftheobligorandmatchingoftheobligor’squalitativeandquantitativeattributestopredefinedTargetMarketand

RiskAcceptanceCriteria,todeterminetheoptimalproductandcreditexposure.

Basedonthecreditreview,eachobligorisassignedanORR.TheORRratingisanassessmentoftheprobabilityofdefaultofa

specificobligorwithinaoneyearhorizonandisderivedfromeithertheDebtRatingModelorScorecard.TheScorecardisused

iftheobligordoesnothaveenoughfinancialinformation.ThebaselineORRfactorsbothquantitativeandqualitativeinputs.

TheFRRratingisanassessmentofthelikelylosscharacteristicsforanindividualfacility,giventheprobabilityofdefaultofa

specificobligor(productofthefinalORRandtheLossGivenDefault(LGD)).

TheGroup’sinternalratingsscaleandmappingtoexternalratingsarelistedbelow:

Theinternalratingsareassignedonascaleof1-10(withsub-grades),definedasfollows:

•1isthebestqualityriskforobligorsnotindefault

•7-istheworstqualityforobligorsnotindefault

•9and10areratingsassignedtoobligorsthatareindefaultandhavenon-performingfacilities

The internal rating classifications reflect the risk profile, which dictates approval level, exposure appetite and level of

monitoring required. Based on this, the investment grade represents the lowest risk profile while the speculative grade

reflectsthehighestriskofaperformingobligor.Defaultisaremedialnonperformingexposure.Allinternalratingsarecross

referencedtoS&PandMoody’sasaneffectivecalibrationtoexternalmarketdata.

Internal Rating Description of the grade External rating: External rating:

Standard & Poor’s equivalent Moody’s equivalent

1-4 InvestmentGrade AAAtoBBB- AaatoBaa3

5-6 NonInvestmentGrade BB+toB- Ba1toB3

7 SpeculativeGrade CCC+toCCC- Caa1toCaa3

9-10 Default Unrated* Unrated

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Monitoring

Once the credit transactions have been approved, there is an established process for monitoring the risk exposure and

maintainingitatacceptablelevels.

Theseriskmanagementprocessesinclude:

• Annualreviewoffacilitieswhichwillinvolverevalidationofexposurelimits,reviewofriskratingsandgeneralaccount

performanceduringthereviewperiod;

• Ataminimum,quarterlycreditcustomercallsincludingapprovingcreditofficers;

• Reviewofthemonthlyandquarterlyportfoliotrends;and

• Documentationreviewtoensureallrequireddocumentationisinplace.

4.1.3 Risk limit control and mitigation policies

TheGroupaspartofitsportfoliomonitoringfunctionsroutinelydefinesconcentrationlimits,withthegoalofestablishinga

well-diversifiedportfoliowhereexpectedreturnonriskcapitalshouldbecommensuratewiththeinherentrisktherein.Single

nametriggerspreventexcessiveconcentrationsoflosstoasinglename,andtogetherformthebasisforcompliancewith

regulatoryrulessuchaslegallendinglimits.Concentrationlimitsaremonitoredonamonthlybasis.

Someotherspecificcontrolandmitigationmeasuresareoutlinedbelow.

Authorizing level approval limit

TheGroup’sinternalcreditapprovallimitsareafunctionofexperienceandcreditexposureinlinewiththeCitigroupICGRisk

Manualrequirementandtheauthoritiesdelegatedbytheboard.However,theboardapprovedlimitsarelistedbelow:

Authorizing Level Approval Limit

Board N5billionandabovefornoncashcollateralizedfacilities(forratification)

BoardCreditCommittee(seenotebelow) 1.N800million–N2.2billionfornoncash-collateralisedfacilities(fornoting).

2.N2.2billion-N5billionfornoncash-collateralisedfacilities.

3.OverN5billionsubjecttofinalratificationbytheBoard,afterboardreviewof

thefullcredit

ManagementCredit 1.Allfullycash-collateralisedfacilities.

Committee 2.UptoN2.2billionfornoncashcollateralizedfacilities

Note:WheretheBoardCreditCommittee’sapprovalforanoncash-collateralisedfacilityisrequired,whichisoverandabove

anycashcollateralised facilities to thesameobligor, theBoardCreditCommitteemustbe informedof the total facilities

granted,i.e.inclusiveofcashcollateralisedfacilities.

ThekeyfeatureofcreditapprovalintheGroupisthefactthatnoonepersoncansinglyapproveacredit,irrespectiveofthe

limit.

Exposuretocreditriskisalsomanagedthroughperiodiccallsontheborrowerstoascertainoperatingperformanceand

determinetheircontinuedabilitytomeetallobligationsasandwhendue.

Collateral

TheGroupfocusesprimarilyonthecash-flowsoftheborrowerforitsrepayments.Thegeneralprincipleisthatrepayment

shouldcomefromthetransactionsfinancedorotheroperatingcash-flows.TheGroupmaintainsapolicyofnotlendinginan

inferiorposition,withoutproperapprovals(andonlyinexceptionalcircumstances),orwhereitisatadisadvantagetoother

lendersasregardsseniorityofclaiminadefaultscenario.

Duringtheannualcreditreviewprocess,searchesareconductedtoverifythattheGroupisnotlendinginaninferiorposition.

Ininstanceswherepre-existingchargesexistonthecustomer’sassets,theGroupgenerallydemandsapari-passuranking

withotherlenders.However,basedonthecreditprofileassessmentonacasebycasebasis,theBoardCreditCommitteemay

alsorequestforadditionalcollateralforcreditenhancement.

Fortermloansfortheacquisitionofspecificassets,theGroupgenerallytakesachargeovertheassetsfinancedbytheterm

loan.

Asageneralprinciple,allcreditsarereviewedandapprovedbasedbroadlyontheunderlistedkeyfactors:

- TheoperationsoftheBorrower/Obligorfallingwithintheapprovedtargetmarket

- Strongfinancialprofilewithemphasisonpresentandfuturecashflowwhichdeterminesthecapacityoftheoperations

tomeetdebtobligations.

- ReviewandassessmentofBorrower/Obligormanagementandsponsors.

- Credithistorytrackrecord.

- Economic/industrytrends

- ForaninternationalcompanywheretheGrouphasrecoursetobranchesorsubsidiariesofCitibankoutsideNigeria,or

wheretheexposureissecuredagainstguarantees,cashorothertypesofcollateral,theBankmayreservetheright

nottoinsistonobtainingalocalsecurityrankingpari-passuwithotherlocallenders,inviewofthesuperioraccessit

maintainsthroughitsglobalaffiliatestotheparentcompanyseniors.

TheGroupimplementstheaboveguidelinesontheacceptabilityofspecificclassesofcollateralorcreditriskmitigation.The

principalcollateraltypesforloansandadvancesare:

- Forsecuredlendingandreverserepurchasetransactions,cashorsecurities;

- Forcommerciallending,cashorchargesoverrealestateproperties,inventoryandtradereceivables;

- Chargesoverfinancialinstrumentssuchasdebtsecurities.

TheGroupalsoobtainsguaranteesfromparentcompaniesforloanstotheirsubsidiariesinNigeria.

Thetotalcollateralheldforloansandadvancesandotherfinancialfacilitiesasat31December2013wasN4,708,150,000

(2012:N11,253,284,503).

Master netting arrangements

The Group restricts its exposure to credit losses by entering into Master netting arrangements with counterparties with

whichitundertakesasignificantvolumeoftransactions.Masternettingarrangementsdonotgenerallyresultinanoffsetof

balancesheetassetsandliabilities,astransactionsareusuallysettledonagrossbasis.However,thecreditriskassociated

withfavourablecontractsisreducedbyamasternettingarrangementtotheextentthatifadefaultoccurs,allamountswith

thecounterpartyareterminatedandsettledonanetbasis.

4.1.4 Impairment and provisioning policies

The internal ratingsystemsdescribedabovefocusmoreoncredit-qualitymappingfromthe inceptionof the lendingand

investmentactivities.Incontrast,impairmentallowancesarerecognisedforfinancialreportingpurposesonlyforlossesthat

havebeenincurredatthebalancesheetdatebasedonobjectiveevidenceofimpairment.Duetodifferentmethodologies

appliedtheamountofincurredcreditlossesmaydifferfromthecriteriasetoutinthePrudentialGuidelinesforlicensedbanks

andanyadditionalprovisionsaretakeninlinewiththePrudentialguidelines.

Theimpairmentallowanceshowninthestatementoffinancialpositionatyear-endisderivedfromeachoftheinternalrating

grades.However,thelargestcomponentoftheimpairmentallowancecomesfromthedefaultgrade.Thetablebelowshows

thepercentageoftheGroup’screditexposureitemsthatincludefinancialassets,financialguarantees,loancommitmentsand

othercreditrelatedobligationsandtheassociatedimpairmentallowanceforeachoftheGroup’sinternalratingcategories.

2013 2012

Group rating Description of the grade Credit Exposure Impairment Credit Exposure Impairment

(%) (%) (%) (%)

1 - 4 InvestmentGrade 21 0 6 0

5 - 6 NonInvestmentGrade 68 0 93 0

7 SpeculativeGrade 11 0 1 0

9 - 10 Default 0 100 0 100

100 100 100

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4.1.5 Maximum exposure to credit risk before collateral held or other credit enhancements

Creditriskexposuresrelatingtofinancialassetsareasfollows:

2013 2012

N’000 N’000

CashandbalanceswithCentralBankofNigeria 22,996,953 20,762,072

Loansandadvancestobanks 122,258,126 121,241,497

Loansandadvancestocustomers 81,538,729 61,168,214

Tradingsecurities

-Debtsecurities 14,466,556 10,962,881

Derivativefinancialinstruments 14,237 167,107

Investmentsecurities

-Debtsecurities 88,762,097 96,621,962

Assetspledgedascollateral 4,646,152 7,808,015

Otherassets 837,687 532,102

335,520,537 319,263,850

Creditriskexposuresrelatingtoothercreditcommitmentsatgrossamountsareasfollows:

Bondsandguarantees 30,252,402 36,394,389

Loancommitments 12,353,883 10,580,142

Othercreditrelatedobligations 13,583,313 15,303,388

56,189,598 62,277,919

At 31 December 391,710,135 381,541,769

ThetableaboveshowsaworsecasescenarioofcreditriskexposuretotheGroupat31December2013and2012,without

takingaccountofanycollateralheldorothercreditenhancementsattached.Forfinancialassets,theexposuressetoutabove

arebasedonamountsasreportedintheconsolidatedstatementoffinancialposition.

Asshownabove,52%(2012:48%)ofthetotalmaximumexposureisderivedfromloansandadvancestobanksandcustomers;

26%(2012:28%)representsexposuretoinvestmentsindebtsecurities.

ManagementisconfidentinitsabilitytocontinuetocontrolandsustainminimalexposureofcreditrisktotheGroupresulting

frombothitsloanandadvancesportfolioanddebtsecuritiesbasedonthefollowing:

- 89%oftheloansandadvancesportfolioiscategorisedinthetoptwogradesoftheinternalratingsystem

(2012:99%);

- 99.96%oftheloansandadvancesportfolioisconsideredtobeneitherpastduenorimpaired(2012:99.95%);and

- TheGrouphasstringentselectionprocessforgrantingloansandadvances.

2013 Nigeria Europe USA Total

N’000 N’000 N’000 N’000

CashandbalanceswithCentralBankofNigeria 22,996,953 - - 22,996,953

Loansandadvancestobanks 17,143,737 11,200,948 93,913,441 122,258,126

Loansandadvancestocustomers 81,538,729 - - 81,538,729

Tradingsecurities

-Debtsecurities 14,466,556 - - 14,466,556

Derivativefinancialinstruments 4,196 10,041 - 14,237

Investmentsecurities-

-Debtsecurities 88,762,097 - - 88,762,097

Assetspledgedascollateral 4,646,152 - - 4,646,152

Otherassets 837,687 - - 837,687

230,396,107 11,210,989 93,913,441 335,520,537

Bondsandguarantees 30,252,402 - - 30,252,402

Loancommitments 12,353,883 - - 12,353,883

Othercreditrelatedobligations 13,583,313 - - 13,583,313

56,189,598 - - 56,189,598

At31December2013 286,585,705 11,210,989 93,913,441 391,710,135

Collateralheldasat31December2013 4,708,150 - - 4,708,150

2012 Nigeria Europe USA Total

N’000 N’000 N’000 N’000

CashandbalanceswithCentralBankofNigeria 20,762,072 - - 20,762,072


Loansandadvancestocustomers 61,168,214 - - 61,168,214

Tradingsecurities

-Debtsecurities 10,962,881 - - 10,962,881

Derivativefinancialinstruments 137,945 29,162 - 167,107


-Debtsecurities 96,621,962 - - 96,621,962

Assetspledgedascollateral 7,808,015 - - 7,808,015

Otherassets 532,102 - - 532,102

203,440,399 12,115,679 103,707,773 319,263,851

Bondsandguarantees 36,394,389 - - 36,394,389

Loancommitments 10,580,142 - - 10,580,142

Othercreditrelatedobligations 15,303,388 - - 15,303,388

62,277,919 - - 62,277,919

At31December2012 265,718,318 12,115,679 103,707,773 381,541,770

Collateralheldasat31December2012 11,253,285 - - 11,253,285

4.1.6 Concentration of risks of financial assets with credit risk exposure

Geographical sectors

ThefollowingtableanalysestheGroup’screditexposure(withouttakingintoaccountanycollateralheldorothercredit

support),ascategorisedbygeographicalregionasat31December2013.Forthistable,theGrouphasallocatedexposures

toregionsbasedonthecountryofdomicileofitscounterparties.

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Industry sectors

ThefollowingtableanalysestheGroup’screditexposure(withouttakingintoaccountanycollateralheldorothercreditsupport),

ascategorisedbyindustrysectorsoftheGroup’scounterparties.

2013 Manufacturing Financial Government Transport and Other Total

Institutions Communication

Cashandbalanceswith

CentralBankofNigeria - 22,996,953 - - - 22,996,953

Loansandadvances

tobanks - 122,258,126 - - - 122,258,126

Loansandadvances

tocustomers 37,383,790 5,023,862 - 7,607,906 31,523,171 81,538,729

Tradingsecurities

-Debtsecurities - - 14,466,556 - - 14,466,556

Derivativefinancial

instruments 12,741 - - 1,496 14,237


-Debtsecurities - - 88,762,097 - - 88,762,097

Assetspledgedas

collateral - - 4,646,152 - - 4,646,152

Otherassets - - 596,580 - 241,108 837,687

37,383,790 150,291,682 108,471,385 7,607,906 31,765,775 335,520,537

Bondsandguarantees 1,831,026 - - 594,504 27,826,872 30,252,402

Loancommitments 3,216,661 6,643,320 - 449,878 2,044,024 12,353,883

Othercreditrelated

obligations 12,084,449 - - - 1,498,864 13,583,313

17,132,136 6,643,320 - 1,044,382 31,369,760 56,189,598

At31December2013 54,515,926 156,935,002 108,471,385 8,652,288 63,135,534 391,710,135

Collateralheldas

at31December2013 3,206,700 - - 120,000 1,181,450 4,508,150

2012 Manufacturing Financial Government Transport and Other Total

Institutions Communication

Cashandbalanceswith

CentralBankofNigeria - 20,762,072 - - - 20,762,072

Loansandadvances

tobanks - 121,241,497 - - - 121,241,497

Loansandadvances

tocustomers 33,238,452 - - 5,058,749 22,871,013 61,168,214

Tradingsecurities

-Debtsecurities - - 10,962,881 - - 10,962,881

Derivativefinancial

instruments 2 167,105 - - - 167,107


-Debtsecurities - - 96,621,962 - - 96,621,962

Assetspledgedas

collateral - - 7,808,015 - - 7,808,015

Otherassets - - 400,186 - 131,916 532,102

33,238,454 142,170,674 115,793,044 5,058,749 23,002,929 319,263,850

Bondsandguarantees 4,568,847 1,256,881 - 1,210,516 29,358,145 36,394,389

Loancommitments 856,410 4,684,500 - 5,039,232 - 10,580,142

Othercreditrelated

obligations 14,168,548 - - - 1,134,840 15,303,388

19,593,805 5,941,381 - 6,249,748 30,492,985 62,277,919

At31December2012 52,832,259 148,112,055 115,793,044 11,308,497 53,495,914 381,541,769

Collateralheldas

at31December2012 4,894,993 748,487 - 1,473,112 4,136,693 11,253,285

4.1.7 Loans and Advances

Loansandadvancesaresummarisedasfollows:

Analysisbyportfoliodistributionandriskrating

2013 2012

Loans and Loans and Loans and Loans and

advances to advances to advances to advances to

customers bank customers bank

Neitherpastdueorimpaired 82,940,321 122,328,311 62,260,052 121,277,472

Pastduebutnotimpaired - - - -

Individuallyimpaired 39,374 - 29,020 -

Gross 82,979,696 122,328,311 62,289,072 121,277,472

Less:Allowanceforimpairment (1,440,967) (70,185) (1,120,858) (35,975)

Net 81,538,729 122,258,126 61,168,214 121,241,497

Allowanceforimpairment:

Individualimpaired 39,374 - 29,020 -

Portfolioallowance 1,401,592 70,185 1,091,838 35,975

Total 1,440,967 70,185 1,120,858 35,975

ThetotalimpairmentforloansandadvancesisN1,511million(2012:N1,157million)ofwhichN39.4million(2012:29.0million)

representstheindividuallyimpairedloansandtheremainingamountofN1,472million(2012:N1,128million)representsthe

portfolioallowance.Furtherinformationoftheimpairmentallowanceforloansandadvancestobanksandtocustomersis

providedinNotes17and18respectively.

Objective evidence that financial assets are impaired can include significant financial difficulty, default on the facility or

probabilitythattheobligorwillenterbankruptcy,thedisappearanceofanactivemarketforasecurity,orotherobservable

datarelatingtoagroupofassetssuchasadversechangesinthepaymentstatusofborrowersorissuersinthegroup,or

economicconditionsthatcorrelatewithdefaultsinthegroup.

Loans and advances neither past due nor impaired

Thecreditqualityoftheportfolioofloansandadvancesthatwereneitherpastduenorimpairedcanbeassessedbyreference

totheinternalratingsystemadoptedbytheGroup. .

Loans and advances to customers: Corporate

2013 2012

Group’s rating Description of Overdraft Term loans Total Overdraft Term loans Total

the grade

1-4 InvestmentGrade 17,115,949 2,461,033 19,576,982 17,091,882 7,372,404 24,464,286

5-6 NonInvestmentGrade 5,424,822 47,282,459 52,707,281 13,563,539 19,031,349 32,594,888

7 SpeculativeGrade 3,565,673 5,688,793 9,254,466 1,941,164 2,167,877 4,109,041

26,106,444 55,432,285 81,538,729 32,596,585 28,571,630 61,168,215

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Loans and advances individually impaired

Thebreakdownofthegrossamountofindividuallyimpairedloansandadvancesbyclass,alongwiththefairvalueofrelated

collateralheldbytheGroupassecurity,areasfollows:

Loans and advances to customers: Corporate

2013 2012

Loans and Loans and Total Loans and Loans and Total

advances to advances to advances to advances to

customers banks customers banks

Grossamount 39,374 - 39,374 29,020 - 29,020

Impairment (39,374) - (39,374) (29,020) - (29,020)

Fairvalueofcollateral - - - - - -

- - - - - -

4.1.8 Analysis of financial assets by credit rating

2013

Group’s rating 1 - 4 5 - 6 7 9 -10 Total

Description of the grade Investment Non Investment Non Investment Default

Grade Grade Grade

CashandbalanceswithCentral

BankofNigeria - 22,996,953 - - 22,996,953

Loansandadvancestobanks 105,330,050 16,928,076 - - 122,258,126

Loansandadvancestocustomers 19,576,982 52,707,281 9,254,466 - 81,538,729

Tradingsecurities

-Debtsecurities - 14,466,556 - - 14,466,556

Derivativefinancialinstruments 10,041 4,196 - - 14,237


-Debtsecurities - 88,762,097 - - 88,762,097

Assetspledgedascollateral - 4,646,152 - - 4,646,152

OtherAssets - 837,687 - - 837,687

124,917,073 201,348,998 9,254,466 - 335,520,538

2012

Group’s rating 1 - 4 5 - 6 7 9 -10 Total

Description of the grade Investment Non Investment Non Investment Default

Grade Grade Grade


BankofNigeria - 20,762,072 - - 20,762,072

Loansandadvancestobanks - 121,241,497 - - 121,241,497

Loansandadvancestocustomers 24,464,286 32,594,888 4,109,040 - 61,168,214

Tradingsecurities

-Debtsecurities - 10,962,881 - - 10,962,881

Derivativefinancialinstruments - 167,107 - - 167,107


-Debtsecurities - 96,621,962 - - 96,621,962

Assetspledgedascollateral - 7,808,015 - - 7,808,015

OtherAssets - 532,102 - - 532,102

24,464,286 290,690,524 4,109,040 - 319,263,850

4.2 Market Risk

Marketriskistheriskthatthefairvalueoffuturecashflowsofafinancialinstrumentwillfluctuatebecauseofchangesin

marketprices.Marketriskcomprisesbothcurrencyriskandpricerisk.Currencyriskistheriskthatthefairvalueorfuture

cashflowsofafinancialinstrumentwillfluctuatebecauseofchangesinforeignexchangerates.Priceriskistheearnings

riskfromchangesininterestrates,andequityandcommodityprices.Priceriskarisesinnon-tradingportfolios,aswellasin

tradingportfolios.

Marketrisksaremeasuredinaccordancewithestablishedstandardstoensureconsistencyacrossbusinessesandtheability

toaggregaterisk.TheGroupisrequiredtoestablish,withapprovalfromindependentmarketriskmanagement,amarket

risklimitframeworkforidentifiedriskfactorsthatclearlydefinesapprovedriskprofileswhicharewithintheparametersof

Citigroup’soverallriskappetite.Inallcases,theGroup’sTreasurydepartmentisultimatelyresponsibleforthemarketrisks

oftheGroupandforremainingwithinitsdefinedlimits.

4.2.1 Foreign Exchange Risk

ForeignExchangeriskistheexposureoftheGroup’sfinancialconditiontoadversemovementsinexchangerates.TheGroup

isexposedtoforeignexchangeriskprimarilythroughitsassets,managingcustomers’depositsandthroughactingasan

intermediaryinforeignexchangetransactions.

Foreign Exchange Risk Management

TheGrouphasarobustriskmanagementsystemthatidentifies,measuresandmitigatestheforeigncurrencyexchangerate

riskonitsfinancialpositionandcashflows.Apartfromregulatoryimposedlimitssuchasthenetopenpositionlimit(OPL)

thathelpstolimittheseexposures,theGrouphasmarketrisklimitssuchas:

-Individualovernightpositionlimitsforindividualcurrencypositions,whichlimitsexchangerateriskinallcurrencies

thattheGrouphasexposures.

-Crosscurrencyfundinglimits(CCFL)thatrestrictstheproportionoflocalcurrencyassetsfundedbyforeigncurrency

liabilities.

-Dailymark-to-marketmechanismthatrevaluesallcurrencypositionsdaily,ensuringthatforeigncurrencypositions

arevaluedatcurrentmarketpriceandnotatcost.

-Trading Management Action Trigger (MAT): This limits, on a realized or mark–to-market basis, the maximum loss

thatyourtotalcurrencypositioncanmakebeforeescalationismadetotheGroup’smanagementandthepositions

liquidatedoreffectivelyhedged.

Where thereareavailable-for-sale securitiesdenominated incurrenciesother than the local currency (Naira), theGroup

couldmitigatethechangeinfairvalueattributabletoforeign-exchangeratemovementsinthosesecurities.Typically,the

instrumentemployedisaforwardforeign-exchangecontracts.

7776

ThetablebelowsummarizestheGroup’sexposuretoforeigncurrencyexchangerateriskat31December2012.Includedin

thetablearetheGroup’sfinancialassetsandliabilitiesatcarryingamounts,categorisedbycurrency.

At 31 December 2013 Naira Dollar GBP Euro Others Total

Assets N’000 N’000 N’000 N’000 N’000 N’000

Cashandbalanceswith

CentralbankofNigeria 22,851,368 90,771 22,648 32,166 - 22,996,953

Loansandadvancestobanks 6,097,936 114,705,968 403,716 429,055 621,451 122,258,126

Loansandadvances

tocustomers 49,047,603 29,750,429 27,415 2,680,055 33,227 81,538,729

Tradingsecurities 14,466,556 - - - - 14,466,556

Derivativefinancialinstruments - 1,496 - 12,741 - 14,237

Investmentsecurities 89,778,262 - - - - 89,778,262

Assetspledgedascollateral 4,646,152 - - - - 4,646,152

Otherassets 651,936 89,499 4,829 91,184 239 837,687

Total financial assets 187,539,813 144,638,163 458,608 3,245,201 654,917 336,536,703

Liabilities

Depositsfrombanks 217,141 73,295 42,098 924,891 5,818 1,263,243

Depositsfromcustomers 129,414,882 144,549,658 431,210 2,239,474 265,970 276,901,195

Derivativefinancial

instruments - 12,393 - - - 12,393

Otherborrowedfunds 700,000 - - - - 700,000

Otherliabilities 5,129,463 549,481 4,614 12,921 16 5,696,495

Total financial liabilities 135,461,487 145,184,827 477,922 3,177,286 271,804 284,573,326

Netfinancialposition 52,078,326 (546,664) (19,314) 67,915 383,114 51,963,377

Creditcommitmentsand

otherfinancialfacilities 22,345,100 26,896,808 57,043 6,793,273 97,375 56,189,598

At 31 December 2012 Naira Dollar GBP Euro Others Total

Assets N’000 N’000 N’000 N’000 N’000 N’000

Cashandbalanceswith

CentralbankofNigeria 20,503,289 227,670 16,342 14,771 - 20,762,072

Loansandadvancestobanks 545,382 117,559,854 1,126,657 1,495,387 514,217 121,241,497

Loansandadvances

tocustomers 39,254,081 17,817,411 65,137 3,970,788 60,797 61,168,214

Tradingsecurities 10,962,881 - - - - 10,962,881

Derivativefinancialinstruments - 135,361 10,587 11,073 10,086 167,107

Investmentsecurities 97,501,871 - - - - 97,501,871

Assetspledgedascollateral 7,808,015 - - - - 7,808,015

Otherassets 410,323 56,774 2,138 61,887 980 532,102

Total financial assets 176,985,842 135,797,070 1,220,861 5,553,906 586,080 320,143,759

Liabilities

Depositsfrombanks 10,379,462 38,684 21,443 - 537 10,440,126

Depositsfromcustomers 123,707,378 123,679,607 670,410 1,946,637 153,977 250,158,009

Derivativefinancial

instruments - 66,297 15,901 7,968 3,384 93,550

Otherborrowedfunds 2,285,714 - - - - 2,285,714

Otherliabilities 4,173,055 291,989 4,707 106,675 118 4,576,544

Total financial liabilities 140,545,609 124,076,577 712,461 2,061,280 158,016 267,553,944

Netfinancialposition 36,440,233 11,720,493 508,400 3,492,626 428,063 52,589,815

Creditcommitmentsand

otherfinancialfacilities 39,347,418 18,815,658 87,094 3,882,571 145,178 62,277,919

4.2.2 Price Risk

Priceriskistheriskthatthefairvalueoffuturecashflowsofafinancialinstrumentwillfluctuatebecauseofchangesinmarket

prices,whetherthosechangesarecausedbyfactorsspecifictotheindividualfinancialinstrumentoritsissuerorbyfactors

affectingallsimilarfinancialinstrumentstradedinthemarket.TheGroupassessthepotentialimpactthatfluctuationsof

idenfiedmarketriskfactorswouldhaveontheGroup’sincomeandthevalueofitsholdingsoffinancialinstruments.

Price Risk Management

Non Trading Portfolios

InterestRateRisk

OneofGroup’sprimarybusinessfunctionsisprovidingfinancialproductsthatmeettheneedsofitscustomers.Loansand

depositsaretailoredtothecustomers’requirementswithregardtotenor,index,andratetype.Netinterestrevenue(NIR)is

thedifferencebetweentheyieldearnedonthenon-tradingportfolioassets(includingcustomerloans)andtheratepaidon

theliabilities(includingcustomerdepositsorwholesaleborrowings).NIRisaffectedbychangesinthelevelofinterestrates.

Forexample:

-Atanygiventime,theremaybeanunequalamountofassetsandliabilitieswhicharesubjecttomarketratesdueto

maturationorrepricing.Whenevertheamountofliabilitiessubjecttorepricingexceedstheamountofassetssubject

torepricing,acompanyisconsidered“liabilitysensitive.”Inthiscase,acompany’sNIRwilldeteriorateinarisingrate

environment.

-Theassetsandliabilitiesofacompanymayrepriceatdifferentspeedsormatureatdifferenttimes,subjectingboth

“liability-sensitive”and“assetsensitive”companiestoNIRsensitivityfromchanginginterestrates.Forexample,a

companymayhavealargeamountofloansthataresubjecttorepricingataparticularperiod,butthemajorityof

depositsarenotscheduledforrepricinguntilthefollowingperiod.ThatcompanywouldsufferfromNIRdeterioration

ifinterestratesweretofall.

NIRinthecurrentperiodistheresultofcustomertransactionsandtherelatedcontractualratesoriginatedinpriorperiods

aswellasnewtransactionsinthecurrentperiod.Thoseprior-periodtransactionswillbeimpactedbychangesinrateson

floating-rateassetsandliabilitiesinthecurrentperiod.

Duetothelong-termnatureoftheportfolios,NIRwillvaryfromquartertoquarterevenassumingnochangeintheshapeor

leveloftheyieldcurveastheassetsandliabilitiesreprice.Theserepricingsareafunctionofimpliedforwardinterestrates,

which represent the overall market’s unbiased estimate of future interest rates and incorporate possible changes in the

overnightrateaswellastheshapeoftheyieldcurve.

InterestRateRiskGovernance

TherisksintheGroup’snon-tradedportfoliosareestimatedusingacommonsetofstandardsthatdefine,measure,limitand

reportthemarketrisk.Eachbusinessisrequiredtoestablish,withapprovalfromindependentmarketriskmanagement,a

marketrisklimitframeworkthatclearlydefinesapprovedriskprofilesandiswithintheparametersoftheGroup’soverallrisk

appetite.

Inallcases,thebusinessesareultimatelyresponsibleforthemarketriskstheytakeandforremainingwithintheirdefined

limits.Theselimitsaremonitoredbyindependentmarketrisk,countryandbusinessALCOsandfinancialcontrol.

InterestRateRiskMeasurement

Theprincipalrisktowhichnon-tradingportfoliosareexposedistheriskoflossfromfluctuationsinthefuturecashflowsor

fairvaluesoffinancial instrumentsbecauseofachangeinmarketinterestrates.Interestrateriskismanagedprincipally

throughmonitoringinterestrategapsandbyhavingpre-approvedlimits.ALCOisthemonitoringbodyforcompliancewith

theselimitsandisassistedbyTreasuryinitsday-to-daymonitoringactivities.

TheGroup’sprincipalmeasureofrisktonet interestrevenue is interestrateexposure(IRE). IREmeasuresthechangein

expectednetinterestrevenueineachcurrencyresultingsolelyfromunanticipatedchangesininterestrates.Factorssuchas

changesinvolumes,spreads,marginsandtheimpactofprior-periodpricingdecisionsarenotcapturedbyIRE.IREassumes

thatbusinessesmakenoadditionalchangesinpricingorbalancesinresponsetotheunanticipatedratechanges.

7978

IREmesuresthepotentialimpactonnetinterestrevenueoveraspecifiedperiod,fortheaccrualpositions,fromadefined

parallelshiftintheyieldcurve.Itisaforward-lookingmeasure,analogoustofactorsensitivityonthetradingportfolios.The

IREmeasuresthepotentialchangeofinterestratemarginoftheBankfor100basispointsparallelchangeofinterestrate

curveinthehorizon.

Theimpactofchangingprepaymentratesonloanportfoliosisincorporatedintotheresults.Forexample,inthedeclining

interestratescenarios,itisassumedthatmortgageportfoliosprepayfasterandincomeisreduced.Inaddition,inarising

interestratescenario,portionsofthedepositportfolioareassumedtoexperiencerateincreasesthatmaybelessthanthe

changeinmarketinterestrates.

Sensitivityanalysisinterestraterisk

Themanagementofinterestrateriskagainstinterestrategaplimitsissupplementedbymonitoringthesensitivityofthe

Group’sfinancialassetsandliabilitiestospecificinterestratescenarios.Thesensitivityanalysisistheeffectoftheassumed

changes in interestratesontheprofitor loss fortheperiod,basedonthefloatingratenon–tradingfinancialassetsand

financialliabilitiesheldat31December2013.Thesensitivityanalysisonthenon-tradingportfolioismeasuredbythechange

inDV01(Dollarvalueof01)thatmeasuresthechangeinvalueofthenon-tradingaccrualportfolioduetoa1basispointparallel

moveintheinterestrates.At31December2013,a1basispointparallelincreaseintheinterestrateswithallothervariables

heldconstantwouldhaveresultedtoatotal lossofN7,475,736(2012:N19,081,530).Ontheavailable-for-sale investment

securities,a1basispointparallelincreaseintheinterestrateswithallothervariablesheldconstant,asat31December2013,

wouldhaveresultedtoanothercomprehensiveincomelossofN12,678,336(2012:N23,200,000).

MitigationofRisk

Allfinancialinstitutions’financialperformanceissubjecttosomedegreeofriskduetochangesininterestrates.Inorderto

managetheseriskseffectively,theGroupmaymodifypricingonnewcustomerloansanddeposits,enterintotransactions

withotherinstitutionsorenterintoforwardexchangecontractsthathavetheoppositeriskexposures.Therefore,theGroup

regularlyassessestheviabilityofstrategiestoreduceunacceptableriskstoearningsandimplementssuchstrategieswhen

theGroupbelievesthoseactionsareprudent.Asinformationbecomesavailable,theGroupformulatesstrategiesaimedat

protectingearningsfromthepotentialnegativeeffectsofchangesininterestrates.

TheGroupemploysadditionalmeasurements,includingstresstestingontheimpactofnon-linearinterestratemovements

onthevalueofthebalancesheet;theanalysisofportfolioduration,volatilityandthepotentialimpactofthechangeinthe

spreadbetweendifferentmarketindices.

Trading Portfolios

Priceriskintradingportfoliosismonitoredusingaseriesofmeasures,including:

-Factorsensitivities

-Value-at-Risk(VAR)

-Stresstesting

i) Factor sensitivities

Factorsensitivitiesareexpressedasthechangeinthevalueofapositionforadefinedchangeinamarketriskfactor,such

asachangeinthepriceofatreasurybillforaone-basis-pointchangeininterestrates.TheGroupindependentmarketrisk

managementensuresthatfactorsensitivitiesarecalculated,monitoredand,inmostcases,limited,forallrelevantriskstaken

inatradingportfolio.

ii) Value-at-Risk (VAR)

TheGroupappliesaValueatRisk(VAR)methodologytoitstradingportfoliostoestimatethemarketriskofpositionsheld

andthemaximumlossesexpected,baseduponanumberofassumptions forvariouschanges inmarketconditions.VAR

isastatisticallybasedestimateof thepotential lossonthecurrentportfolio fromadversemarketmovements.TheVAR

methodincorporatesthefactorsensitivitiesofthetradingportfoliowiththevolatilitiesandcorrelationsofthosefactorsand

isexpressedasthe‘maximum’amounttheBankmightloseoveraone-dayholdingperiod,ata99%confidencelevel.The

Group’sVARisbasedonthevolatilitiesofandcorrelationsamongamultitudeofmarketriskfactorsaswellasfactorsthat

trackthespecificissuerriskindebtsecurities.

AsVARconstitutesanintegralpartoftheGroup’smarketriskcontrolregime,VARlimitsaresetbytheGroup’sALCO,after

consultationswithCitigroupIndependentRiskManagement.Actualexposureagainstlimits,togetherwithabank-wideVAR,

is revieweddailybyTreasury.The following table summarises tradingprice riskbydisclosing theVaRexposureasat31

December:

VAR Analysis 2013 2012

N’000 N’000

Interestraterisk 244,122 395,528

Foreigncurrencyrisk 3,490 4,216

Overallportfoliorisk 243,610 395,996

TheGroupperiodicallyperformsextensiveback-testingofmanyhypotheticaltestportfoliosasonecheckoftheaccuracy

ofitsVAR.Back-testingistheprocessinwhichthedailyVARofaportfolioiscomparedtotheactualdailychangeinthe

marketvalueofitstransactions.Back-testingisconductedtoconfirmthatthedailymarketvaluelossesinexcessofa99%

confidenceleveloccur,onaverage,only1%ofthetime.TheVARcalculationforthehypotheticaltestportfolios,withdifferent

degreesofriskconcentration,meetsthesestatisticalcriteria.

iii) Stress testing

Stresstestingisperformedontradingportfoliosonaregularbasistoestimatetheimpactofextrememarketmovements.

Itisperformedonbothindividualtradingportfolios,andonaggregationsofportfoliosandbusinesses.Independentmarket

riskmanagement,inconjunctionwiththebusinesses,developsstressscenarios,reviewstheoutputofperiodicstresstesting

exercises,andusestheinformationtomakejudgmentsastotheongoingappropriatenessofexposurelevelsandlimits

Eachtradingportfoliohasitsownmarketrisklimitframeworkencompassingthesemeasuresandothercontrols,including

permittedproductlistsandanewproductapprovalprocessforcomplexproducts.

Thelevelofpriceriskexposureatanygivenpointintimedependsonthemarketenvironmentandexpectationsoffuture

priceandmarketmovements,andwillvaryfromperiodtoperiod.

4.3 Liquidity Risk

LiquidityriskistheriskthattheGroupisunabletomeetitsobligationsasandwhentheyfallduewithoutaffectingitsdaily

operations or its financial condition. The Group’s approach to managing liquidity is to ensure, as far as possible, that it

alwayshassufficientliquiditytomeetitsliabilitieswhendue,underbothnormalandstressedconditions,withoutincurring

unacceptablelossesorriskingdamagetothebank’sreputation.

Liquidity Risk Management

ManagementofliquidityattheGroupistheresponsibilityoftheRiskTreasurer.Thereisauniformliquidityriskmanagement

policyforCitigroup.Underthispolicy, there isasinglesetofstandardsforthemeasurementof liquidityrisk inorderto

ensureconsistencyacrossbusinesses,stabilityinmethodologiesandtransparencyofrisk.Managementofliquidityriskis

performedonadailybasisandismonitoredbytheCountryTreasurerandindependentriskmanagement,combinedwithan

activecorporateoversightfunction.

TheGroup’sALCOundertakesthisoversightresponsibilityalongwiththeCountryTreasurer.OneoftheobjectivesofALCO

istomonitorandreviewtheoverall liquidityandbalancesheetpositionsof theGroup.TheRiskTreasurermustprepare

anannualfundingandliquidityplanforreviewbytheCountryTreasurerandapprovedbyindependentriskmanagement.

Thefundingandliquidityplanincludesanalysisofthestatementoffinancialposition,aswellastheeconomicandbusiness

conditions impacting the liquidityof theGroup.Aspartof the fundingand liquidityplan, liquidity limits, liquidity ratios,

markettriggers,andassumptionsforperiodicstresstestsareestablishedandapproved.Ataminimum,theseparameters

arereviewedonanannualbasis.

8180

Liquiditylimits

Liquiditylimitsestablishboundariesformarketaccessinbusiness-as-usualconditionsandaremonitoredagainsttheliquidity

positiononadailybasis.Theselimitsareestablishedbasedonthesizeofthestatementoffinancialposition,depthofthe

market,experience levelof localmanagement,stabilityof the liabilitiesand liquidityof theassets.Finally, the limitsare

subject toevaluationof theGroup’sstress testresult.Generally, limitsareestablishedsuchthat instressscenarios, the

entitiesareself-fundedornetprovidersofliquidity.Thus,therisktoleranceoftheliquiditypositionislimitedbasedonthe

capacitytocoverthepositioninastressedenvironment.TheselimitsarethekeydailyriskmanagementtoolsforTreasury

management.

Liquiditysources

TheGroupmaintainscashandaportfolioofhighlyliquidgovernmentsecuritiesthatcouldbesoldorfinancedonasecured

basis.

Liquidityratios

Aseriesofstandardcorporate-wideliquidityratioshavebeenestablishedtomonitorthestructuralelementsoftheGroup’s

liquidity. Ratios are established for liquid assets against short-term obligations. Key liquidity ratios include cash capital

(definedascoredeposits,long-termdebt,andcapitalcomparedwithilliquidassets),liquidassetsagainstliquiditygaps,core

depositstoloans,anddepositstoloans.Severalmeasuresexisttoreviewpotentialconcentrationsoffundingbyindividual

name,product,industry,orgeography.Triggersformanagementdiscussion,whichmayresultinotheractions,havebeen

establishedagainsttheseratios.

TheCentralBankofNigeriarequiresbankstomaintainastatutoryminimumliquidityratioof30%ofliquidassetstoallits

localcurrencydeposit liabilities.Forthispurpose, liquidassetscomprisecashandbalanceswithCentralBankofNigeria

andotherlocalbanks,treasurybills,FGNBonds,placementandmoneyatcallwithotherbanks.Depositliabilitiescomprise

depositsfromcustomers,depositsfrombanks.TheliquidityratioatthereportingdateDecember312013was91.73%(2012:

86.07%).

Market triggers:

Markettriggersareinternal,externalmarketoreconomicfactorsthatmayimplyachangetomarketliquidityorCitigroup’s

accesstothemarkets.CitibankNigeria’smarkettriggersaremonitoredonaweeklybasisbytheCountryTreasurerandthe

headofRiskandarepresentedtotheALCOatthemonthlymeeting.

Stress testing:

Simulated liquidity stress testing is periodically performed by the Group. A variety of firm-specific and market related

scenarios are used at the consolidated level and in individual businesses. These scenarios include assumptions about

significantchangesinkeyfundingsources,creditratings,contingentusesoffunding,andpoliticalandeconomicconditions

inspecificcountries.Theresultsofthestresstestsarereviewedtoensurethatthebankiseitheraself-fundedornetprovider

ofliquidity.Inaddition,aContingencyFundingPlanispreparedonaperiodicbasisforCitigroup.Theplanincludesdetailed

policies,procedures,rolesandresponsibilities,andtheresultsofcorporatestresstests.Theproductofthesestresstestsis

aseriesofalternativesthatcanbeusedbytheTreasurerinaliquidityevent.

4.3.1 Analysis of financial assets and liabilities by remaining contractual maturities

Thetablebelowsummarisesthematurityprofileofthefinancialassetsandliabilities:

31 December 2013 Up to 1 1 – 3 3 – 12 1 – 5 Over 5 Total

month months months years years

N’000 N’000 N’000 N’000 N’000 N’000

Assets:


BankofNigeria 22,996,953 - - - - 22,996,953

Loansandadvancestobanks 111,551,102 - - 10,707,024 - 122,258,126

Loansandadvancestocustomers 48,202,315 11,887,119 1,798,028 15,088,137 4,563,129 81,538,729

Tradingsecurities 1,996,769 93,332 6,495,415 2,176,611 3,704,429 14,466,556

Derivativefinancialinstruments 6,817 - 7,420 - - 14,237

Investmentsecurities 10,247,634 21,979,248 2,361,316 41,602,611 13,587,452 89,778,262

Assetspledgedascollateral 118,864 4,527,288 - - - 4,646,152

Otherassets 123,858 275,932 437,897 - - 837,687

Total financial assets 195,244,312 38,762,919 11,100,076 69,574,383 21,855,010 336,536,702

Liabilities:

Depositsfrombanks 1,263,243 - - - - 1,263,243

Depositsfromcustomers 276,901,195 - - - - 276,901,195

Derivativefinancialinstruments 6,540 1 5,853 - - 12,393

Otherborrowedfunds - 700,000 - - - 700,000

Otherliabilities 1,492,636 366,365 1,191,399 2,646,095 - 5,696,495

Total financial liabilities 279,663,614 1,066,366 1,197,252 2,646,095 - 284,573,326

Net financial assets (liabilities) 84,419,302 (37,696,553) (9,902,826) (66,928,288) (21,855,010) (51,963,377)



N’000 N’000 N’000 N’000 N’000 N’000

Assets:


BankofNigeria 20,762,072 - - - - 20,762,072

Loansandadvancestobanks 117,532,954 - - 3,708,543 - 121,241,497

Loansandadvancestocustomers 36,448,810 11,696,260 6,556,361 6,008,097 458,686 61,168,214

Tradingsecurities 729,603 1,525,902 258,155 598,676 7,850,545 10,962,881

Derivativefinancialinstruments 14,964 146,147 5,996 - - 167,107

Investmentsecurities 8,971,033 14,033,972 4,964,118 46,783,086 22,749,661 97,501,871

Assetspledgedascollateral - - 6,426,820 1,381,195 - 7,808,015

Otherassets 20,784 511,318 - - - 532,102

Total financial assets 184,480,220 27,913,598 18,211,451 58,479,598 31,058,892 320,143,759

Liabilities:

Depositsfrombanks 10,440,127 - - - - 10,440,127

Depositsfromcustomers 247,016,524 3,123,624 17,862 - - 250,158,010

Derivativefinancialinstruments 79,346 10,462 3,741 - - 93,550

Otherborrowedfunds 728,571 - 1,557,143 - - 2,285,714

Otherliabilities 632,506 1,950,961 - 1,993,077 - 4,576,544

Total financial liabilities 258,897,075 5,085,047 1,578,746 1,993,077 - 267,553,945

Net financial assets (liabilities) 74,416,855 (22,828,551) (16,632,705) (56,486,521) (31,058,892) (52,589,814)

8382

Credit commitments and other financial facilities



N’000 N’000 N’000 N’000 N’000 N’000

Loancommitments - - - 7,332,666 5,021,217 12,353,883

Guarantees,acceptancesandother

financialfacilities 12,615,768 773,093 5,123,993 972,981 24,349,880 43,835,715

Total 12,615,768 773,093 5,123,993 8,305,647 29,371,097 56,189,598



N’000 N’000 N’000 N’000 N’000 N’000

Loancommitments - - - 9,773,155 806,987 10,580,142


financialfacilities 2,026,846 4,276,725 16,884,461 297,339 28,212,406 51,697,777

Total 2,026,846 4,276,725 16,884,461 10,070,494 29,019,393 62,277,919

4.4 Capital Management

TheGroup’scapitalmanagementprocessisdesignedtoensuremaintenanceofsufficientcapitalconsistentwiththeGroup’s

riskprofile,allapplicableregulatorystandardsandguidelines.ItistheGroup’sobjectivetomaintainastrongcapitalbaseto

supportthebusinessandregulatorycapitalrequirementsatalltimes.Thecapitalmanagementprocessiscentrallyoverseen

byseniormanagementandisreviewedattheconsolidated,legalentity,andcountrylevel.

Regulatory Capital

TheGroup’sprimaryregulator,CentralBankofNigeria,setsandmonitorscapitalrequirementsforthebank.Itprescribes

theminimumratioforcapitaladequacyandminimumcapitalrequirements.TheBankmustatalltimesmeettherelevant

minimumcapitalrequirementsoftheCentralBankofNigeria.TheBankhasestablishedprocessesandcontrolsinplaceto

monitorandmanageitscapitalrequirementsandremainedincompliancewiththeserequirementsthroughouttheyear.

Thecapitaladequacyrequirementsassetout in theCentralBankofNigeria,prescribesaminimumratioof totalcapital

tototalrisk-weightedassets.TheriskweightedassetsarearrivedatusingtheBasel1framework,asdefinedintheCentral

BankofNigeriaguidelines,onbothbalancesheetpositionandcreditcommitmentsandotherfinancialfacilitiestoreflectthe

relativeriskofeachassetandcounterparty.

TheBank’sregulatorycapitalcomprisesoftwotiersasfollows:

Tier1capital: sharecapital,statutoryreserve,retainedearningsandreservescreatedbyappropriationsofretained

earnings;and

Tier2capital: collective impairment allowances and the change in the fair value of available-for-sale investment

securities.

TheregulatorycapitalismanagedbyTreasury.

Further,ALCOmonitorstheRegulatoryandCitigroupcapitalratiorequirementstoensurecompliance.Asat31December

2013,theBankwasincompliancewithalltheapplicablecapitalratios.

ThetablebelowsummarisesthecompositionofregulatorycapitalandtheratiosoftheBankfortheyearsended31December

2013and2012.Duringthosetwoyears,theBankcompliedwithalloftheexternallyimposedcapitalrequirements

2013 2012

N’000 N’000

Tier 1 capital

Sharecapital 2,793,777 2,793,777

Sharepremium 11,643,995 11,643,995

Statutoryreserves 19,943,575 17,871,399


Total qualifying Tier 1 capital 51,202,274 48,423,192

Tier 2 capital

Collectiveportfolioimpairmentprovision 1,471,777 1,127,813

Fairvaluereserve (1,108,780) 749,278

Total qualifying Tier 2 capital 362,997 1,877,091

Total regulatory capital 51,565,271 50,300,283

Risk-weighted assets:

On-balancesheet 120,999,883 109,064,223

Off-balancesheet 30,586,913 60,775,828

Total risk-weighted assets 151,586,796 169,840,051

RiskweightedCapitalAdequacy

Ratio(RegulatoryMinimum10%) 34% 30%

8584

4.5 Fair value of financial assets and liabilities

4.5.1 Thetablebelowsummarisesthecarryingamountsandfairvaluesofthosefinancialassetsandliabilitiesnotmeasured

atfairvalueintheGroup’sconsolidatedstatementoffinancialposition

Carrying value Fair value

31 December 2013 2012 2013 2012

N’000 N’000 N’000 N’000

Financial assets


Loansandadvancestocustomers 81,538,729 61,168,214 82,940,321 62,260,052

Otherassets 837,687 532,102 837,687 532,102

204,634,542 182,941,813 206,106,320 184,069,626

Financial liabilities

Depositsfrombanks 1,263,243 10,440,127 1,263,243 10,440,127

Depositsfromcustomers 276,901,195 250,158,010 276,901,195 250,158,010

Otherborrowedfunds 700,000 2,285,714 700,000 2,285,714

Otherliabilities 5,696,494 4,576,544 5,696,494 4,576,544

284,560,932 267,460,395 284,560,932 267,460,395

Credit commitments and other financial facilities

Loancommitments 12,353,883 10,580,142 12,353,883 10,580,142


financialfacilities 56,189,598 51,697,778 56,189,598 51,697,778

68,543,481 62,277,920 68,543,481 62,277,920

Thetablesaboveshowtheclassificationoffinancialinstrumentsheldatfairvalueandcategorizedintothelevel3valuation

hierarchy.

i) Loans and advances to banks

Loansandadvancestobanksincludeinterbankplacements,loansanditemsinthecourseofcollection.

Thecarryingamountofthefloatingrateplacementsandovernightdepositsisareasonableapproximationoffairvalue.

ii) Loans and advances to customers

Loansandadvancestocustomersarenetofprovisionsforimpairment.Theestimatedfairvalueofloansandadvances

representsthediscountedamountoffuturecashflowsexpectedtobereceived,includingassumptionsrelatingtoprepayment

rates.Expectedcashflowsarediscountedatcurrentmarketratestodeterminefairvalue.Asubstantialproportionofloans

andadvancesrepricewithin12monthsandhencethegrosscarryingamountisagoodproxyofthefairvalue.

iii) Other Assets

Otherassetsrelatetoreceivablesthathaveashorttermmaturity(lessthanthreemonths)thereforeitisassumedthatthe

carryingamountsapproximatetheirfairvalue.

iv) Deposits from banks and customers and other liabilities

Theestimatedfairvalueofdepositswithnostatedmaturityistheamountrepayableondemand.Theestimatedfairvalueof

fixedinterestbearingdepositswithoutquotedmarketpricesisbasedondiscountingcashflowsusingtheprevailingmarket.

Asubstantialproportionofdepositsarewithin6monthsandhencethecarryingamountisagoodestimateofthefairvalue.

(v) Credit commitments and other financial facilities

Theestimatedfairvaluesofthecreditcommitmentsandotherfinancialfacilitiesarebasedonmarketpricesforsimilarfacil-

ities.Whenthisinformationisnotavailable,fairvalueisestimatedasthecarryingvalue.

4.5.2 Fair value hierarchy

TheGroupmeasuresfairvaluesusingthefollowingfairvaluehierarchythatreflectsthesignificanceoftheinputsusedin

makingthemeasurement.

Level1: Quotedmarketprice(unadjusted)inanactivemarketforanidenticalinstrument.

Level2: Valuationtechniquesbasedonobservableinputs,eitherdirectly(i.e.asprices)orindirectly(i.e.derivedfromprices).

Thiscategoryincludesinstrumentsvaluedusing:quotedmarketpricesinactivemarketsforsimilarinstruments;

quoted for identical or similar instruments in markets that are considered less than active; or other valuation

techniqueswhereallsignificantinputsaredirectlyorindirectlyobservablefrommarketdata.

Level3: Valuation techniques using significant unobservable inputs. This category includes all instruments where the

valuation technique includes inputs not based on observable data and the observable inputs have a significant

effectontheinstrument’svaluation.Thiscategoryincludesinstrumentsthatarevaluedbasedonquotedprices

for similar instruments where significant unobservable adjustments or assumptions are required to reflect the

differencebetweentheinstruments.

TheGroupusesthefollowingprocedurestodeterminethefairvalueoffinancialassetsandliabilities:

Trading securities

Whereavailable,theGroupusesthequotedmarketpricestodeterminethefairvalueoftradingassetsandsuchitemsare

classifiedasLevel1ofthefairvaluehierarchy.

Wheretherearesecuritiesthatarenotactivelytraded, theGroupuses internalvaluationtechniqueswhicharebasedon

observableinputsobtainedfromthequotedmarketpricesofsimiliaractivelytradedsecurities.

Derivatives

ThederivativesenteredintobytheGroupareexecutedoverthecounterandsoarevaluedusinginternalvaluationtechniques.

Thisderivativesconsistofforeignexchangeforwardcontractsandtheprincipaltechniqueusedtovaluetheseintrumentsis

basedonmarketobservableinputs.Thevaluationtechniquesincludeforwardpricingbasedoninterpolationofthecurrent

interestratesandforeignexchangerates.

Thekeyinputsdependuponthethetypeofderivativeandthenatureofunderlyinginstrumentandincludeinterestrateyield

curvesandforeignexchangerates,whicharebasedonobservableinputthereforeclassifiedasLevel2.

8786

31 December 2013 Level 1 Level 2 Level 3 Total

N’000 N’000 N’000 N’000

Assets

Tradingsecurities 10,140,019 4,326,536 - 14,466,556

Derivativefinancialinstruments - 14,237 - 14,237

Investmentsecurities 78,746,201 10,674,444 357,617 89,778,262

Total assets 88,886,220 15,015,217 357,617 104,259,055

Liabilities


Total liabilities - 12,393 - 12,393

31 December 2012 Level 1 Level 2 Level 3 Total

N’000 N’000 N’000 N’000

Assets

Tradingsecurities 10,409,514 553,367 - 10,962,881


Investmentsecurities 67,070,217 30,171,244 260,410 97,501,871

Total assets 77,479,730 30,891,719 260,410 108,631,859

Liabilities


Total liabilities - 93,550 - 93,550

ThefollowingtablepresentsthechangesinLevel3instrumentsfortheyearend31December2013.

2013 2012

N’000 N’000

At1January 260,410 201,347

Disposalofinvestmentsecurities (17,812) (62,537)

Netchangeinfairvalueofavailable-for-salesecurities 115,019 133,319

Impairment of equity securities - (11,719)

At 31 December 357,617 260,410

Investment securities

Investmentsecuritiesclassifiedasavailable-for-salearemeasuredatfairvaluebyreferencetoquotedmarketpriceswhen

availableandthereforeareclassifiedasLevel1.

Ifquotedmarketpricesarenotavailable,thefairvaluesareestimatedbasedoninternalvaluationtechniques.Thekeyinputs

dependuponthetypeofinvestmentsecurityandthenatureofinputstothevaluationtechnique.Theitemisplacedineither

Level2orLevel3dependingontheobservabilityofthesignificantinputstothemodel.

Thetablebelowshowstheclassificationoffinancialinstrumentsheldatfairvalueintothevaluationhierarchysetoutbelowasat31December:

Level3financialinstrumentsrelatestoavailable-for-saleunlistedequitysecuritiesandsincequotedmarketpricesarenot

available,thefairvaluesareestimatedbasedoninternalvaluationtechniquesasfollows:

i)InvestmentinSMEIIPartnershipfundwhichinturnhasequityinvestmentinvarioussmallandmediumenterprises.The

investmentvaluationisbasedontheportfoliovaluationdonebytheSMEfundManagers.

ii)OtherequityinvestmentrelatetoCentralSecuritiesClearingSystemLimited,NigerianInterbankSettlementSystemPlc

andUnifiedPaymentsServicesLimited.Thevaluationisbasedonamarketapproachvaluationwheretheadjustedprice/

earningsmultipleofcomparablecompaniesisutilised.

Therewasnotransferofsecuritiesbetweenlevelsin2013(2012:Nil)

Thenotesbelowrepresent“GroupandBank”withexceptionofwherethesearedifferentandthereforeseparatedisclosureis

madefor“Group”andfor“Bank”.

5. INTEREST INCOME

Interestincomecomprises:

2013 2012

N’000 N’000

CashandbalanceswithCentralBankofNigeria 1,164,299 292,446

Loansandadvancestobanks 1,673,497 2,019,173

Loansandadvancestocustomers 6,514,313 7,953,763

Tradingsecurities 506,986 2,714,433

Investmentsecurities 10,469,605 8,614,246

20,328,700 21,594,061

Investmentandtradingsecuritiescompriseofdebtsecurities

6. INTEREST EXPENSE

Interestexpensecomprises:

2013 2012

N’000 N’000

Depositsfrombanks 522,255 1,209,271

Depositsfromcustomers 4,275,067 4,974,789

Otherborrowedfunds 10,974 3,469

4,808,296 6,187,529

7. FEE AND COMMISSION INCOME AND EXPENSE

Feeandcommissionincome:

2013 2012

N’000 N’000

Advisoryrelatedfeesandcommissions 207,841 5,115

Custody&Clearingfees 597,924 372,184

Transactionalservicesfees 3,385,857 3,732,136

Otherfeesandcommissions 13,515 74,735

4,205,137 4,184,170

Fee and commission expense:

Otherfeespaid 34,160 20,435

34,160 20,435

8. NET GAINS / (LOSSES) FROM FINANCIAL INSTRUMENTS HELD FOR TRADING

2013 2012

N’000 N’000

Foreignexchangeincome 3,527,310 4,407,577

Tradingincomeonsecurities 1,546,817 1,845,858

5,074,127 6,253,435

8988

9. NET INVESTMENT INCOME

Group Group Bank Bank

2013 2012 2013 2012

N’000 N’000 N’000 N’000

Profitsonsaleofavailableforsale

investmentsecurities 3,589,060 2,152,967 3,589,060 2,152,967

Dividendonequitysecurities 33,939 16,037 45,034 24,913

Impairmentchargeonequity

investment(Note9.1) - (11,720) - (11,720)

3,622,999 2,157,284 3,634,094 2,166,160

10. OTHER OPERATING INCOME

Group Group

2013 2012

N’000 N’000

RentalIncome 168,721 166,900

Gainondisposalofproperty,plantandequipment 16,225 2,264

Otherincome - 7,162

184,946 176,326

11. PERSONNEL EXPENSES


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Wagesandsalaries 3,923,722 3,795,794 3,923,722 3,795,794

Pensioncosts(Note29) 172,406 171,059 172,406 171,059

Executivecompensation(Note38.2) 161,100 190,002 161,100 190,002

Otherindirectemployeecosts(Note11.1) 1,077,636 999,412 838,990 821,182

5,334,864 5,156,267 5,096,218 4,978,037

11.1 DividendpaidtostaffbasedontheTreasurysharesheldbythestaffparticipationschemeofN238,645,831(2012:

N178,229,313)whichwassubjecttowith-holdingtax,isincludedwithintheindirectemployeecostsincurredbytheGroup

12. OTHER OPERATING EXPENSES


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Generaladminstrativeexpenses 1,473,521 1,368,959 1,473,770 1,369,195

AMCONcharge(seenote12.1) 1,617,930 1,114,000 1,617,930 1,114,000

Depositinsurancepremium1,193,191 1,465,487 1,193,191 1,465,487

Communicationsandpostages 321,155 235,845 321,155 235,845

Travelandentertainment 228,930 318,558 228,930 318,558

Premises,furnitureandequipment 560,830 519,243 560,830 519,243

Informationtechnologylevy 169,586 172,079 169,586 172,079

Directorsfeesandallowances(Note38.2) 51,750 37,400 51,750 37,400

5,616,893 5,231,571 5,617,142 5,231,807

IncludedwithintheGeneraladministrativeexpensesisauditors’remunerationasfollows:

2013 2012 2013 2012

N’000 N’000 N’000 N’000

Auditor’sremuneration 55,500 65,500 54,000 64,000

12.1 AMCON charge

The Asset Management Corporation of Nigeria (AMCON) acquired Eligible Bank Assets from banks to resolve the non-

performingloanscrisis inthebankingindustry.TheGroupdidnotsellEligibleBankAssetstoAMCON.AllNigerianbanks

arerequiredtoparticipate inpartial fundingofthebankingsectorresolutioncoststhroughaprescribedAMCONcharge.

IncompliancewiththeMemorandumofUnderstandinginrelationtotheEstablishmentandfundingoftheBankingSector

resolutioncostsinkingfund,the2013AMCONchargecontributionwasN1.617billionrepresenting0.5%(2012:N1.114billion

representing0.3%)ofthebank’stotalbalancesheetassetsfortheprecedingyear.

13. NET CREDIT LOSSES

Group Group

2013 2012

N’000 N’000

Loans and advances to banks:

Increaseinimpairment(Note17.2) (34,210) (2,714)

Loans and advances to Customers:

Increaseinimpairment(Note18.3) (402,843) (243,388)

Recoveriesonloanspreviouslywrittenoff 517 4,131

(436,537) (241,971)

9190

14. TAXATION

14.1 The tax charge for the year comprises:


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Corporateincometax 3,630,633 3,389,112 3,630,553 3,389,037

Educationtax 142,707 222,472 142,707 222,472

Adjustmentsinrespectofprioryear(Note14.3) (160,090) 28,906 (160,090) 28,906

Currentincometaxcharge 3,613,250 3,640,490 3,613,170 3,640,414

Deferredtaxation(Note34) (346,158) 234,376 (346,158) 234,376

3,267,092 3,874,866 3,267,012 3,874,790

14.2ThetaxontheGroup’sprofitdiffersfromthetheoreticalamountusingthebasictaxrateasfollows:


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Profitbeforetax 16,910,222 16,899,258 17,081,517 17,029,476

Computedtaxusingtheapplicable

corporatetaxrateat30% 5,073,067 5,069,778 5,124,455 5,108,843

Educationtax 142,707 222,471 142,707 222,471

Taxeffectonassociate’sshareofprofit

reportednetoftax (23,459) (16,996) - -

Taxeffectofnon-deductibleexpenses 573,980 253,148 502,307 199,604

Taxeffectofnon-taxableincome (2,339,113) (1,682,441) (2,342,367) (1,685,033

3,427,182 3,845,960 3,427,102 3,845,885

Adjustmentsinrespectofprioryear(Note14.3) (160,090) 28,906 (160,090) 28,906

Income tax expense 3,267,092 3,874,866 3,267,012 3,874,791

Thecurrenttaxchargehasbeencomputedattheapplicablerateof30%(2012:30%)ontheprofitfortheyearafteradjusting

forcertainitemsofincomeandexpenditure,whicharenotdeductibleorchargeablefortaxpurposes.Thisresultedtoan

effectivetaxrateof19%(2012:23%).Inaddition,itincludes2%(2012:2%)educationtaxchargefortheyear.

14.3 Theadjustmentinrespectofprioryearreflectsthedefferencebetweentheestimatedtaxliabilityrecognisedinthe

financialstatementsandthefinaltaxreturnssubmittedtothetaxauthorityforthatyear.

14.4 Thetax(charge)/creditrelatingtocomponentsofothercomprehensiveincomeisasfollows:

2013 Before tax Tax (charge) After tax

/credit

N’000 N’000 N’000

Fair value gains/(losses) on availablefor-sale assets (2,654,369) 796,311 (1,858,058)

2012 Before tax Tax (charge) After tax

/credit

N’000 N’000 N’000

Fair value gains/(losses) on availablefor-sale assets 6,840,822 (2,052,247) 4,788,575

15. EARNINGS PER SHARE

15.1 Basic

Basicearningspershare iscalculatedbydividing theprofitattributable toordinaryshareholdersof thecompanyby the

weightedaveragenumberofordinarysharesinissueduringtheyearexcludingtheaveragenumberofordinarysharesheld

bytheGroupastreasuryshares.


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Profitattributabletoordinary

shareholders(N’000) 13,643,130 13,024,392 13,814,505 13,154,684

Weightedaveragenumberofordinary

sharesinissue(N’000) 2,793,777 2,793,777 2,793,777 2,793,777

LessTreasuryshares(N’000) (60,417) (60,417) - -

Adjustedweightedaveragenumberof

ordinarysharesinissue 2,733,360 2,733,360 2,793,777 2,793,777

Basicearningspershare

(expressedinNairapershare) 4.99 4.76 4.94 4.71

15.2 Diluted

TheGroupdoesnothavepotentialordinaryshareswithconvertibleoptionandthereforethereisnodilutiveimpactonthe

profitattributtabletotheordinaryshareholdersoftheGroup(2012:Nil).

16. CASH AND BALANCES WITH CENTRAL BANK OF NIGERIA:

16.1 Cash and balances with Central Bank of Nigeria:

2013 2012

N’000 N’000

Cash 791,606 913,539

Balances held with Central Bank of Nigeria:

Currentaccounts 4,283,533 5,158,827

Totalincludedincashandcashequivalents(Note40) 5 ,075,139 6,072,366

Mandatoryreservedeposit(see(16.2)below) 17,921,814 14,689,706

22,996,953 20,762,072

16.2 Thisrepresents12%ofcustomerdepositsand50%ofpublicsectordeposits(2012: 12%-alldeposits)ofmonthly

averagedailybalancesofdepositliabilities.MandatoryreservedepositsarenotavailableforuseintheGroup’sdaytoday

operations.

9392

17. LOANS AND ADVANCES TO BANKS

2013 2012

N’000 N’000

In Nigeria:

Currentaccounts 666,311 651,142

Securedplacements 5,501,506 -

Outside Nigeria:

Currentaccounts 103,975,840 101,978,959

PlacementswithotherCitigroupbranches - 12,146,741

Placementsheldonaccountofcustomers’obligations(Note17.1) 1,354,210 2,756,112

Totalincludedincashandcashequivalents(Note40) 111,497,867 117,532,954

Loanstobanks 10,830,444 3,744,518

Lessallowanceforimpairment(Note17.2) (70,185) (35,975)

122,258,126 121,241,497

Current 111,551,102 117,532,954

Non-current 10,707,024 3,708,543

122,258,126 121,241,49

17.1 This represents the Naira value of foreign currencies held on behalf of customers in respect of letter of credit

transactions.Thecorrespondingliabilityforthisamountisincludedincustomerdeposits(seenote28).

17.2 Themovementontheallowanceforloanstobanksduringtheyearwasasfollows:

2013 2012

N’000 N’000

Collective Collective

Allowance Allowance

At1January 35,975 33,261

Chargeagainstprofits(Note13) 34,210 2,714

At 31 December 70,185 35,975

18. LOANS AND ADVANCES TO CUSTOMERS

18.1 Theclassificationofloansandadvancesisasfollows:

N’000

Specific Collective

2013 Gross allowance for allowance for Total Carrying

Amount Impairment Impairment Impairment Amount

Loansandadvances 80,277,684 39,374 1,387,918 1,427,292 78,850,392

Advancesunderfinancelease 2,702,012 - 13,675 13,675 2,688,337

82,979,696 39,374 1,401,592 1,440,967 81,538,729

N’000

Specific Collective

2012 Gross allowance for allowance for Total Carrying

Amount Impairment Impairment Impairment Amount

Loansandadvances 62,140,845 29,020 1,091,768 1,120,788 61,020,057

Advancesunderfinancelease 148,227 - 70 70 148,157

62,289,072 29,020 1,091,838 1,120,858 61,168,214

2013 2012

N’000 N’000

Current(Gross) 63,491,639 55,822,290

Non-current(Gross) 19,488,056 6,466,782

82,979,695 62,289,072

2013 2012

N’000 N’000

Grossinvestmentinfinanceleases

nolaterthanoneyear 95,492 38,450

laterthanoneyearandnolaterthanfiveyears 2,694,133 144,780

2,789,625 183,230

Unearnedincome (87,613) (35,003)

Net investment in finance leases 2 ,702,012 148,227

Thenetinvestmentinfinanceleasesmaybeanalysedasfollows:

Expiring:

nolaterthanoneyear 10,878 3,446

laterthanoneyearandnolaterthanfiveyears 2,691,134 144,781

2,702,012 148,227

18.2 Loansandadvancestocustomersincludefinanceleasereceivables

9594

18.3 Themovementontheallowanceforloansandadvancesduringtheyearwasasfollows:

2013 2013 2013

N’000 N’000 N’000

Specific Collective Total

Movement of allowance for loans Allowance Allowance Allowance

At1January 29,020 1,091,838 1,120,858

Chargeagainstprofits(Note13) 10,355 392,489 402,844

Provisionsnolongerrequired - (82,735) (82,735)

At31December 39,374 1,401,592 1,440,967

Allowanceforloansbyclass -

Loansandadvances 39,374 1,387,918 1,427,292

Advancesunderfinancelease - 13,675 13,675

39,374 1,401,592 1,440,967

2012 2012 2012

N’000 N’000 N’000

Specific Collective Total

Movement of allowance for loans Allowance Allowance Allowance

At1January 15,536 861,934 877,470

Chargeagainstprofits(Note13) 13,484 229,904 243,388

At31December 29,020 1,091,838 1,120,858

Allowanceforloansbyclass -

Loansandadvances 29,020 1,091,768 1,120,788

Advancesunderfinancelease - 70 70

29,020 1,091,838 1,120,858

19. TRADING SECURITIES

Thesecomprise:

2013 2012

N’000 N’000

Treasurybills 8,462,237 2,532,554

FederalGovernmentofNigeriaBonds 6,004,319 8,430,327

14,466,556 10,962,881

Current 8,585,517 2,513,660

Noncurrent 5,881,039 8,449,221

14,466,556 10,962,881

Asofreportingdate,noneofthelistedtreasurybillswerepledgedtothirdpartiesundersecuredborrowingandassecurity

deposittoclearinghouseandpaymentagencies(2012:N6,426,820,000).

20. DERIVATIVE FINANCIAL INSTRUMENTS

Derivativesarefinancial instrumentsthatderivetheirvalueinresponsetochangesininterestrates,financial instrument

prices,commodityprices,foreignexchangerates,creditriskandindices.ThetypesofderivativesusedbytheGroupareset

outbelow.

All derivatives are initially recognised at fair value and subsequently measured at fair value, with all fair value changes

recognisedinthestatementofcomprehensive

Thetablebelowanalysesthenotionalprincipalamountsandthepositive(assets)andnegative(liabilities)fairvaluesofthe

Group’sderivativefinancialinstruments.Notionalprincipalamountsaretheamountsofprincipalunderlyingthecontractat

thereportingdate.

2013

Notional principal Assets Liabilities

N’000 N’000 N’000

Foreign exchange forward contracts 2,347,626 14,237 12,393

2012

Notional principal Assets Liabilities

N’000 N’000 N’000

Foreign exchange forward contracts 33,757,591 167,107 93,550

21. INVESTMENT SECURITIES

Availableforsaleinvestments:

2013 2012

N’000 N’000

Debtsecurities-atfairvalue

Unlisted 88,762,097 96,621,962

Equitysecurities-atfairvalue:

Listed 658,548 619,499

Unlisted 357,617 260,410

Total Available-for-sale investment securities 89,778,262 97,501,871

Current 34,588,199 28,075,863

Non-current 55,190,063 69,426,008

89,778,262 97,501,871

Alldebtsecuritieshavefixedcoupons.ListeddebtsecuritiesavailableforsaleatfairvalueofN4,646,152,378werepledgedto

thirdpartiesundersecuredborrowingandassecuritydeposittoclearinghouseandpaymentagencies(2012:N1,381,195,385),

andaredisclosedunderAssetspledgedascollateralinnote22.

9796

21.1 Movementininvestmentsecuritiescanbesummarisedasfollows:

2013 Debt securities - at Equity securities

fair value: at fair value: Total

N’000 N’000 N’000

At1January 96,621,962 879,909 97,501,871

Purchaseofinvestmentsecurities 53,516,111 - 53,516,111

Disposalofinvestmentsecurities (58,567,539) (17,812) (58,585,352)

Impairmentofequitysecurities - - -

Netchangeinfairvalue (910,750) 154,068 (756,683)

Netamounttransferredtoprofitorloss(Note21.2) (1,897,686) - (1,897,686)

At 31 December 88,762,098 1,016,165 89,778,262

2012 Debt securities - at Equity securities

fair value: at fair value: Total

N’000 N’000 N’000

At1January 63,248,090 768,741 64,016,831

Purchaseofinvestmentsecurities 45,828,781 - 45,828,781

Disposalofinvestmentsecurities (19,110,307) (62,537) (19,172,844)

Impairmentofequitysecurities - (11,719) (11,719)

Netchangeinfairvalue 6,701,315 185,424 6,886,739

Netamounttransferredtoprofitorloss(Note21.2) (45,917) - (45,917)

At31December 96,621,962 879,909 97,501,871

21.2 Thisrelatestoreclassificationadjustmentsforrealisednetgainsonavailable-for-salesecuritiesondisposalor

maturitythathavebeenrecognisedthroughstatementofcomprehensiveincome.

22. ASSETS PLEDGED AS COLLATERAL

2013 2013

N’000 N’000

Tradingsecurities - 6,426,820

Investmentsecurities 4,646,152 1,381,195

4,646,152 7,808,015

Therelatedliabilityforassetspledgedascollateralinclude

BankofIndustry(Note31) 1,336,995 785,714

Depositsfrombanks - 4,000,000

1,336,995 4,785,714

Current 4,646,152 7,808,015

Noncurrent - -

4,646,152 7,808,015

N1,337billionwaspledgedtoBankof Industryundersecuredborrowingarrangementswiththerelated liabilitydisclosed

above.Inaddition,N3,309,157,605(2012:N3,126,445,637),forwhichtherewasnorelatedliability,waspledgedassecurity

deposittoclearinghouseandpaymentagencies.TheGroupcannottradeonthesepledgedassetsduringtheperiodthatsuch

assetsarecommittedaspledged.

23. OTHER ASSETS

2013 2012

N’000 N’000

Prepayments 253,388 318,590

Receivables 837,687 532,102

1,091,075 850,692

Current 1,060,852 371,652

Non-current 30,223 479,040

1,091,075 850,692

24. INVESTMENTS IN ASSOCIATE

AssociatesarethoseentitiesoverwhichtheGrouphassignificantinfluencebutnotcontrol,generallyaccompanyingashare-

holdingbetween20%and50%ofthevotingrights.Inaddition,itincludesentitieswheretheshareholdingislessthan20%

butsuchsignificantinfluencecanbedemonstratedwiththeexistenceofrepresentationontheboardofdirectorsorequiv-

alentgoverningbodyofthe investee.TheGrouphasdeterminedthat its investment inAccionMicrofinanceBankLimited

shouldbetreatedasaninvestmentinassociatebasedonit’sboardrepresentationinthecompany.


2013 2012 2013 2012

N’000 N’000 N’000 N’000

At1January 497,762 449,986 398,020 398,020

Shareofprofitaftertax 78,197 56,652 - -

Dividendsreceived (11,095) (8,876) - -

At 31 December 564,864 497,762 398,020 398,020

TheGrouphasaninvestment inoneAssociate,AccionMicrofinanceBankLimited,withan19.9%equityparticipationand

representationon theboardof the investee.Thishasbeenaccounted forusing theequitymethodunder theGroupand

carriedatcostintheBank’sseperatefinancialstatements.

ApartfromtheinformationdisclosedabovetherewerenoothertransactionswiththeAssociates.

SummarisedfinancialinformationoftheGroup’sassociateaccountedforusingtheequitymethodareasfollows:

2013 2013

N’000 N’000

TotalAssets 3,935,482 2,673,435

TotalLiabilities (1,902,916) (970,013)

Net Assets 2,032,566 1,703,422

Revenues 1,709,376 1,196,921

Profit 392,948 284,683

Totalcomprehensiveincome 392,948 284,683

GroupShareofProfit 78,197 56,652

Group Share of Total comprehensive income 78,197 56,652

TherewerenopublishedpricequotationsfortheassociateoftheGroup.Furthermore,therearenosignificantrestrictionson

theabilityoftheassociatetotransferfundstotheGroupintheformofcashdividends,orrepaymentofloansoradvances.

9998

25. PROPERTY, PLANT AND EQUIPMENT

Themovementontheseaccountsduringtheyearwasasfollows:

Computer

Leasehold Equipment, Work in Total

improvements Furniture & Motor Progress

Year ended 31 December 2013 Land and buildings Equipment Vehicles (WIP)

N’000 N’000 N’000 N’000 N’000 N’000

COST

At1January 596,385 1,416,429 3,398,697 734,924 8,483 6,154,918

Additions - - 202,979 146,175 33,525 382,679

Disposals - - (292,897) (199,142) - (492,039)

At31December 596,385 1,416,429 3,308,779 681,957 42,008 6,045,558

ACCUMULATED DEPRECIATION

At1January - 152,750 2,974,027 409,436 - 3,536,213

Chargefortheyear - 39,010 158,782 147,835 - 345,628

Disposals - - (279,996) (163,220) - (443,216)

At31December - 191,760 2,852,813 394,051 - 3,438,625

NET BOOK VALUE

At 31 December 596,385 1,224,668 455,966 287,905 42,008 2,606,933

Computer

Leasehold Equipment, Work in Total

improvements Furniture & Motor Progress

Year ended 31 December 2012 Land and buildings Equipment Vehicles (WIP)

N’000 N’000 N’000 N’000 N’000 N’000

COST

At1January 596,385 1,314,697 3,160,684 728,914 106,199 5,906,879

Additions - 19,919 275,449 220,372 7,080 522,820

Disposals - - (60,419) (214,362) - (274,781)

TransferstofixedassetsfromWIP - 81,813 22,983 - (104,796) -

At31December 596,385 1,416,429 3,398,697 734,924 8,483 6,154,918

ACCUMULATED DEPRECIATION

At1January - 121,158 2,552,072 406,162 - 3,079,392

Chargefortheyear - 31,592 466,237 178,879 - 676,708

Disposals - - (44,282) (175,605) - (219,886)

At31December - 152,750 2,974,028 409,436 - 3,536,213

NET BOOK VALUE

At 31 December 596,385 1,263,679 424,670 325,488 8,483 2,618,705

26. INTANGIBLE ASSETS

ComprisesofPurchasedsoftware:

2013 2012

N’000 N’000

Cost:

At1January 24,568 24,568

Additions - -

Disposals - -

24,568 24,568

Amortization:

At1January 17,060 8,871

Chargefortheyear 7,507 8,189

Disposals - -

24,567 17,060

December 31 Net value - 7,508

27. DEPOSITS FROM BANKS

2013 2012

N’000 N’000

Currentaccounts 1,263,243 439,007

Termdeposits - 10,001,120

1,263,243 10,440,127

Current 1,263,243 10,440,127

Non-current - -

1,263,243 10,440,127

Depositfrombanksonlyincludefinancialinstrumentsclassifedasliabilitiesatamortisedcost.

Depositsfrombankshavefixedorvariableinterestrates.

101100

28. DEPOSITS FROM CUSTOMERS

Depositsandotheraccountscomprise:


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Demand 247,540,961 226,502,666 247,542,186 226,503,664

Term 29,360,234 23,655,344 29,360,234 23,655,344

276,901,195 250,158,010 276,902,420 250,159,008

Current 276,901,195 250,158,010 276,902,420 250,159,008

Non-current - - - -

276,901,195 250,158,010 276,902,420 250,159,008

Depositfromcustomersonlyincludefinancialinstrumentsclassifedasliabilitiesatamortisedcost.

28.1 IncludedinthisbalanceistheNairavalueofforeigncurrenciesamountingtoN1,354,209,844(2012:N2,756,112,000)

heldonbehalfofcustomersascashcollateralinrespectofletterofcredittransactions.

28.2 IncludedindepositsfromcustomersisanamountofN136,338,876,764(2012:N132,240,563,085)offixedorvariable

interestrateandallotherdepositsarenon-interestbearingdeposits.

29. RETIREMENT BENEFIT OBLIGATION

Themovementonretirementbenefitobligationaccountduringtheyearwasasfollows:

2013 2012

N’000 N’000

At1January 13,054 10,894

Employeecontribution 173,413 183,055

Chargetoprofitandloss(Note11) 172,406 171,059

Remittancesduringtheyear (350,810) (351,954)

At 31 December 8,063 13,054

TheGroupanditsemployeesmakeajointcontributionof15%(7.5%each)ofbasicsalary,housingandtransportallowance

toeachemployee’sretirementsavingsaccountmaintainedwiththeirrespectivenominatedPensionFundAdministratorsin

compliancewiththePensionReformActof2004.

30. CURRENT INCOME TAX LIABILITIES

ThemovementinIncometaxpayableduringtheyearisasfollows:


2013 2012 2013 2012

N’000 N’000 N’000 N’000

At1January 3,551,266 2,497,527 3,551,191 2,497,527

Paymentsduringtheyear (3,423,668) (2,586,750) (3,423,644) (2,586,750)

Currentyeartaxcharge(Note14.1) 3,613,250 3,640,489 3,613,170 3,640,414

At 31 December 3,740,849 3,551,266 3,740,717 3,551,191

31. OTHER BORROWED FUNDS

2013 2012

N’000 N’000

BankofIndustry(Note31.1) 700,000 785,714

CentralBankofNigeria(CACS)(Note31.2) - 1,500,000

700,000 2,285,714

Current 700,000 2,285,714

Non-current - -

700,000 2,285,714

31.1 On-lending liabilityfromBankof Industry(BOI)forwhichamanagementfeeof 1%ischargedand issecuredwith

NigerianTreasurybillswithfacevaluenotlessthan100%ofthefacilityandisrepayablequarterlyexpiringinMarch2014.

31.2 On-lendingliabilityfromCentralBankofNigeriaundertheCommercialAgriculturalCreditScheme(CACS)wasrepaid

inSeptember2013.

32. OTHER LIABILITIES

Otherliabilitiescomprise:


2013 2012 2013 2012

N’000 N’000 N’000 N’000

Unearnedincome 282,010 240,411 282,010 240,411

Managers’cheques 3,318,749 3,268,226 3,318,749 3,268,226

Payables 1,386,980 675,811 1,386,980 675,811

Sundryaccounts 708,755 392,096 708,755 392,096

Financial liabilities 5,696,494 4,576,544 5,696,494 4,576,544

Accruals 1,510,434 1,405,439 1,510,690 1,405,697

Bankingsectorresolutioncost - 776,737 - 776,737

Technologylevy 169,586 172,079 169,586 172,079

Non financial liabilities 1,680,020 2,354,255 1,680,276 2,354,513

7,376,514 6,930,799 7,376,770 6,931,057

Current 5,084,723 4,937,722 5,084,979 4,937,980

Non-current 2,291,791 1,993,077 2,291,791 1,993,077

7,376,514 6,930,799 7,376,770 6,931,057

103102

33. PROVISIONS

Provisionscomprise:

2013 2012

N’000 N’000

At1January 58,488 58,488

At 31 December 58,488 58,488

Current - -

Non-current 58,488 58,488

58,488 58,488

TheamountrepresenttheaggregateprovisionsforcertainlegalclaimsbroughtagainsttheGroup,inwhichitisprobablethat

therewouldbefutureoutflowofeconomicbenefitstosettlesuchlegalobligationsandwhosevaluescanbereliablyestimated

asat31December2013.Theprovisionchargeisrecognisedinthestatementofprofitorlosswithinotheroperatingexpenses.

Thebalanceasat31December2013representsareasonableestimateofwhatwouldberequiredtosettlethelegalclaims

eventhoughsomeofthemattersarestillinprogressasatreportingdate

34. DEFERRED TAXATION

Movementondeferredtaxaccountduringtheyearwasasfollows:

2013

At 1 January Recognized in Recognized in At 31 December

Deffered tax asset/(liability) 2013 income statement equity 2013

N’000 N’000 N’000 N’000

Propertyandequipment (403,453) (165,539) - (568,992)

Loanimpairmentreserve (58,352) 511,697 - 453,345

Fairvaluereserve (321,119) - 796,311 475,192

(782,924) 346,158 796,311 359,545

2012

At 1 January Recognized in Recognized in At 31 December

Deffered tax asset/(liability) 2012 income statement equity 2012

N’000 N’000 N’000 N’000

Propertyandequipment (493,475) 90,022 - (403,453)

Loanimpairmentreserve 266,046 (324,398) - (58,352)

Fairvaluereserve 1,731,128 - (2,052,247) (321,119)

1,503,699 (234,376) (2,052,247) (782,924)

RecognitionofdeferredtaxassetsofN359,545,000(2012:Nil)isbasedonmanagement’sprofitforecasts(whicharebased

onavailableevidence,includinghistoricallevelsofprofitability),whichindicatesthatitisprobablethattheGroup’sentitywill

havefuturetaxableprofitsagainstwhichtheseassetscanbeutilised.

IAS12statesthatthedeferredtaxassetsandliabilitiesshouldbemeasuredatthetaxratesthatareexpectedtoapplytothe

periodwhentheassetisrealizedortheliabilitysettledbasedontaxratesthathavebeenenactedorsubstantivelyenacted

bythebalancesheetdate.

35. SHARE CAPITAL

Sharecapitalcomprises:

2013 2012

N’000 N’000

Authorised:

3.0billionOrdinarysharesofN1.00each 3,000,000 3,000,000

Issued and fully paid

2.794billionOrdinarysharesofN1.00each 2,793,777 2,793,777

Otherreservesinclude:

35.1 Share premium

Premiumsfromtheissueofsharesarereportedinthesharepremium.

35.2 Treasury shares reserve

Treasurysharesreserveholds60,416,666unitsoftheBank’sshareswhichwereputasideforemployeesandheldintrustby

thestaffparticipationscheme(31December2012:60,416,666).

35.3 Statutory reserve

Statutoryreservesincludei)themandatoryannualappropriationasrequiredbytheBanksandOtherFinancialInstitution

ActofNigeriaandii)theSmallandMediumScaleIndustriesReserve(SMEEIS)reservemaintainedtocomplywiththeCentral

BankofNigeriarequirement.

35.4 Fair value reserve

Thefairvaluereserveincludesthenetcumulativechangeinthefairvalueofavailable-for-saleinvestmentsecuritiesuntilthe

investmentisderecognisedorimpaired.

Themovementonfairvaluereserveaccountduringtheyearwasasfollows:

2013 2012

N’000 N’000

At1January 749,278 (4,039,297)

Netchangeinfairvalueofavailable-for-salesecurities(Note21.1) (756,683) 6,886,739

Reclassificationadjustmentsforrealisednetgainsonavailable-for-

salesecurities(Note21.1) (1,897,686) (45,917)

Nettaxchargeonfairvaluechanges(Note14.3) 796,311 (2,052,247)

At 31 December (1,108,780) 749,278

105104

35.5 Regulatory risk reserve

Theregulatoryriskreservewouldbereflectedwheretheimpairmentlossesrequiredbyprudentialregulationsexceedthose

computedunderIFRS.Suchexcessisrecognisedasastatutorycreditreserveandisaccountedforasanappropriationof

retainedearnings.

StatementofPrudentialadjustments

2013 2012

N’000 N’000

IFRSimpairmentlosses

-Loansandadvancestobanks(Note17) 70,185 35,975

-Loansandadvancestocustomers(Note18) 1,440,967 1,120,858

Total 1,511,152 1,156,833

Loananalysisbyperformance

Performing:

-GrossLoansandadvancestobanks(Note17) 10,830,444 3,744,518

-GrossLoansandadvancestocustomers(Note18) 82,940,321 62,260,052

Non-performing:

-Grossnonperformingloansandadvancestocustomers(Note18) 39,374 29,020

93,810,140 66,033,590

PrudentialProvisions

-Specific 39,374 29,020

-General 937,708 660,045

Total 977,082 689,065

Surplus/(deficit) of IFRS provisions over prudential provisions 534,070 467,768

As IFRS provisions are greater than Prudential provisions therefore no transfer was required to the non-distributable

statutorycreditreserve.

36. CONTINGENT LIABILITIES AND COMMITMENTS

36.1 Litigations and claims

Therewere31 litigationsandclaimsagainst theGroupasat31December2013.These litigationsandclaimsarose in the

normalcourseofbusinessandarebeingcontestedbytheGroup.Thedirectors,havingsoughtprofessionallegalcounsel,

areoftheopinionthatnosignificantliabilitywillcrystallizefromtheselitigationsandthereforenoprovisionsaredeemed

necessarytobemadeinthefinancialstatements.

2013 2013

N’000 N’000

Acceptances 1,171,373 2,095,311

Lettersofcredit 12,411,940 13,208,077

Bondsandguarantees 30,252,402 36,394,389

Loancommitments 12,353,883 10,580,142

56,189,598 62,277,919

CertainbondsandguaranteesarecashcollateralizedandsecuredwithatotalsumofN94,192,244(2012:N716,597,937).

36.3 Capital commitments

Thegrouphasacapitalcommitmentasat31December:

2013 2012

N’000 N’000

NotLaterthan1year 16,350 -

Laterthan1yearbutnotlaterthan5years - -

16,350 -

37. RELATED PARTY TRANSACTIONS

Partiesareconsideredtoberelatedifonepartyhastheabilitytocontroltheotherpartyorexercisesignificantinfluenceover

theotherpartyinmakingfinancialandoperationaldecisions,oranotherpartycontrolsbothentities.TheGroupdefinitionof

relatedpartiesincludessubsidiary,associatesandkeymanagementpersonnel.

Transactionswithkeymanagementpersonnel

The Group’s key management personnel, and persons connected with them, are also considered to be related parties.

Thedefinitionofkeymanagement includes theclosemembersof familyofkeypersonnelandanyentityoverwhichkey

management exercise control. The key management personnel have been identified as the executive and non-executive

directorsoftheGroup.Closemembersoffamilyarethosefamilymemberswhomaybeexpectedtoinfluence,orbeinfluenced

bythatindividualintheirdealingswithGroup.

37.1 Parent and ultimate controlling party

81.9%oftheBank’ssharecapitalisheldbyCitibankOverseasInvestmentCorporation.TheultimateparentoftheGroupis

CitigroupInc.whichisincorporatedintheUnitedStatesofAmerica.Inthenormalcourseofthebank’sbusiness,theGroup

entersintobusinesstransactionswithotherCitigroupoffices.

BalanceswithotherCitigroupofficesasat31December

2013 2012

N’000 N’000

Assets

LoansandadvancestoBanks 105,114,389 116,881,738

Loansandadvancestocustomers - 8


105,124,429 116,910,908

Liabilities

Depositsfrombanks 1,112,167 348,466

DepositsfromCustomers 8,276,943 2,489,493


9,391,787 2,851,148

IncomeandexpensesfromotherCitigroupofficesduringtheyear

Interestandsimilarincome 247,113 139,974

Interestandsimilarexpense (213,285) (64,849)

Netinterestincome 33,828 75,125

Feeandcommissionincome 537,702 26,015

571,530 101,140

107106

37.2 KeymanagementpersonnelandtheirimmediaterelativesengagedinthefollowingtransactionswiththeGroupasat

31December2013

2013 2012

N’000 N’000

Loans and advances 7,143 3,328

Deposits 62,714 54,261

Loans and advances granted to key management personnnel are loans extended to employees under the employment

schemeofservice.Noimpairmentlosseshavebeenrecordedagainstbalancesoutstandingattheendoftheperiod.

Therewerenoothertransactionsinwhichadirectorhadaninterestasatreportingdatein2013.

KeymanagementpersonnelcompensationfortheperiodisdisclosedunderNote38.2.

37.3 TransactionsbetweenCitibankNigeriaLimitedanditssubsidiaryalsomeetthedefinitionofrelatedpartytransactions.

Thesetransactionsareeliminatedonconsolidation,andarenotdisclosedintheconsolidatedfinancialstatements.

Depositsoutstandingasat31December

Name of company Relationship Type of deposit 2013 2012

N’000 N’000

NigeriaInternationalBankNomineesLimited Subsidiary Deposit 1,225 998

1,225 998

TheinvestmentinassociateisdisclosedunderNote24.

38. EMPLOYEES AND DIRECTORS

38.1 Employees:

Thenumberofpersonsemployedasattheendoftheyearisasfollows:

2013 2012

ExecutiveDirectors 4 4

Management 195 195

Non-management 44 45

243 244

Costofemployees,excludingexecutivedirectors,duringtheyearisasfollows:

Name of company Group Group Bank Bank

2013 2012 2013 2012

N’000 N’000 N’000 N’000

Wagesandsalaries 4,084,822 3,985,796 4,084,822 3,985,796

Pensioncosts 172,406 171,059 172,406 171,059

4,257,228 4,156,855 4,257,228 4,156,855

Otherindirectemployeecosts 1,077,636 999,412 838,990 821,182

Totalpersonnelexpenses(Note11) 5,334,864 5,156,267 5,096,218 4,978,037

ExecutiveCompensation (161,100) (190,002) (161,100) (190,002)

5,173,764 4,966,265 4,935,118 4,788,035

The number of persons employed by the Group, who received emoluments in the following ranges (excluding pension

contribution),were:

2013 2012

N2,000,001 - N3,000,000 4 10

N3,000,001 - N4,000,000 17 20

N4,000,001 - N5,000,000 14 7

N5,000,001 - N6,000,000 13 13

N6,000,001 - N7,000,000 8 18

AboveN7,000,000 186 176

243 244

38.2 Directors

Directors’remunerationwaspaidasfollows:

2013 2012

N’000 N’000

Feesandsittingallowances(Note12) 51,750 37,400

Executivecompensation(Note11) 161,100 190,00

212,850 227,402

Thedirectors’remunerationshownaboveincludes:

2013 2012

N’000 N’000

Chairman 11,500 8,400

Highestpaiddirector 55,000 39,250

Thenumberofotherdirectorswhoreceivedfeesandotheremoluments(excludingpensioncontributions)inthefollowing

rangeswere:

2013 2012

Number Number

AboveN2,000,000 10 9

Oneforeigndirectorandonelocalnon-executivedirectordidnotreceiveanyfeesorotheremoluments.

109108

39. DIVIDEND

The dividend paid in 2013 and 2012 were N11,035,420,055 (N3.95k per share) and N8,241,642,826 (N2.95k per share)

respectively.Adividendinrespectoftheyearended31December2013ofN4.20kpershare,amountingtoatotaldividend

ofN11,733,864,362, is tobeproposedatthenextannualgeneralmeeting.Thesefinancialstatementsdonotreflectthis

dividendpayable.

40. CASH AND CASH EQUIVALENTS

Forthepurposesofthecashflowstatement,cashandcashequivalentsincludecashandnonrestrictedbalanceswiththe

CentralBankofNigeria,treasurybillsandothereligiblebills,operatingaccountbalanceswithotherbanks,amountduefrom

otherbanks:

2013 2012

N’000 N’000

CashandbalanceswithCentralBankofNigeria(Note16.1) 5,075,139 6,072,366

Tradingsecurities-Treasurybills 1,966,822 1,747,822

Loansandadvancestobanks(Note17) 111,497,867 117,532,954

118,539,828 125,353,142

41. GROUP ENTITIES

41.1 Investments in subsidiaries comprises:

2013 2012

N’000 N’000

NigeriaInternationalBankNomineesLimited 1,000 1,000

TherewasnomovementintheBank’sinvestmentinthesharecapitalofitsfullyownedsubsidiaryduringtheyear.

41.2 InvestmentinAssociatescomprisesofAccionMicrofinanceBankasdisclosedinNote24.

41.3 TreasurysharescomprisesofthestaffparticipationschemeasdisclosedinNote35.2.

41.4 Condensedresultsoftheconsolidatedentitiesareasfollows:

31 December 2013 Bank NIB Accion Staff Elimination Group

In N’000 Nominees Microfinance participation Entities

Scheme

OperatingIncome 28,584,549 2,731 (11,095) - (2,731) 28,573,454

OperatingExpenses (11,503,032) (2,482) - (238,646) 2,731 (11,741,429)

17,081,517 249 (11,095) (238,646) - 16,832,025

Shareofprofitofassociates

accountedforusingequitymethod - - 78,197 - - 78,197

Profitbeforetax 17,081,517 249 67,102 (238,646) - 16,910,222

Tax (3,267,012) (80) - - - (3,267,092)

Profit after tax 13,814,505 169 67,102 (238,646) - 13,643,130

TotalAssets 340,155,588 3,955 166,844 60,417 (65,372) 340,321,432

Liabilities 290,062,094 2,606 - - (3,955) 290,060,745

NetAssets 50,093,494 1,349 166,844 60,417 (61,417) 50,260,687

Equity 50,093,494 1,349 166,844 60,417 (61,417) 50,260,687

31 December 2012 Bank NIB Accion Staff Elimination Group

In N’000 Nominees Microfinance participation Entities

Scheme

OperatingIncome 28,166,188 2,587 (8,876) - (2,587) 28,157,313

OperatingExpenses (11,136,712) (2,352) - (178,229) 2,587 (11,314,706)

17,029,476 235 (8,876) (178,229) - 16,842,606


accountedforusingequitymethod - - 56,652 - - 56,652

Profitbeforetax 17,029,476 235 47,776 (178,229) - 16,899,258

Tax (3,874,791) (75) - - - (3,874,867)

Profit after tax 13,154,685 160 47,776 (178,229) - 13,024,392

TotalAssets 323,487,582 3,585 99,742 60,417 (65,002) 323,586,324

Liabilities 274,315,112 2,404 - - (3,585) 274,313,932

NetAssets 49,172,470 1,180 99,742 60,417 (61,417) 49,272,392

Equity 49,172,470 1,180 99,742 60,417 (61,417) 49,272,392

111110

42. COMPLIANCE WITH BANKING REGULATIONS

TheBankdidnotcontraveneanyprovisionsoftheBanksandOtherFinancialInstitutionsAct(BOFIA).TheBankcontravened

theprovisionsofCentralBankofNigeriacircularrefFPR/DIR/CIR/GEN/01/016andwasfinedatotalsumofN372,000,000for

failingtoseekpriorCBNapprovalforthehireandpromotionofstaffofAssistantGeneralManagerlevelandabove.

43. POST BALANCE SHEET EVENTS

TherewerenopostreportingdateeventswhichcouldhaveamaterialeffectonthefinancialpositionoftheGroupandBank

asat31December2013ortheprofitfortheyearendedonthatdatethathavenotbeenadequatelyprovidedforordisclosed.

Group Bank

2013 2012 2013 2012

N’000 % N’000 % N’000 % N’000 %

GrossOperating

income 33,381,749 34,344,841 33,392,845 34,353,717

Interestexpense

-Foreign (67,342) (64,849) (67,342) (64,849)

-Local (4,740,954) (6,122,680) (4,743,447) (6,122,680

28,573,453 28,157,312 28,582,056 28,166,188

Netcreditlosses (436,536) (241,971) (436,536) (241,971)

Adminstrative

overheads (5,616,893) (5,231,571) (5,617,142) (5,231,807)

Shareofprofitof

associatesaccountedfor

usingequitymethod 78,197 56,652 - -

22,598,221 100% 22,740,422 100% 22,528,378 100% 22,692,411 100%

Distribution:

Employees

-Salariesandbenefits 5,334,864 24% 5,156,267 23% 5,096,218 23% 4,978,037 22%

Government

-Taxation 3,267,092 14% 3,874,866 17% 3,267,012 14% 3,874,791 17%

Future

-Assetreplacement

(depreciation) 353,135 2% 684,897 3% 353,135 2% 684,897 3%

-Expansion

(transfertoequity) 13,643,130 60% 13,024,392 57% 13,814,505 61% 13,154,684 58%

22,598,221 100% 22,740,422 100% 22,530,870 100% 22,692,410 100%

UNAUDITED STATEMENT OF VALUE ADDEDFOR THE YEAR ENDED 31 DECEMBER 2013

IFRS IFRS IFRS NGAAP NGAAP

2013 2012 2011 2010 2009

N’000 N’000 N’000 N’000 N’000

ASSETS

Cashandbalanceswith

CentralBankofNigeria 22,996,953 20,762,072 13,420,668 2,983,740 24,539,219

Loansandadvancestobanks 122,258,126 121,241,497 215,295,404 - -

Loansandadvancestocustomers 81,538,729 61,168,214 55,422,672 43,833,016 44,856,319

Tradingsecurities 14,466,556 10,962,881 7,226,690 - -

Derivativefinancialinstruments 14,237 167,107 383,387 - -

Investmentsecurities 89,778,262 97,501,871 64,016,831 55,654,073 18,022,956

Assetspledgedascollateral 4,646,152 7,808,015 6,231,282 - -

Otherassets 1,091,075 850,692 342,820 4,939,766 854,044

Investmentsinassociates 564,864 497,762 449,986 - -

Property,plantandequipment 2,606,933 2,618,705 2,827,488 3,106,370 3,138,001

IntangibleAssets - 7,508 15,697 - -

Deferredtaxasset 359,545 - 1,503,699 - -

Treasurybillsandothereligiblebills - - - 3,012,113 5,894,955

Duefromotherbanks - - - 144,998,390 84,493,142

On-lendingfacilities - - - 322,500 -

Advancesunderfinanceleases - - - 62,376 67,761

Total assets 340,321,432 323,586,324 367,136,624 258,912,344 181,866,397

LIABILITIES

Depositsfrombanks 1,263,243 10,440,127 248,008 - -

Depositsfromcustomers 276,901,195 250,158,010 315,733,569 206,134,576 125,113,021

Derivativefinancialinstruments 12,393 93,550 248,926 - -

Retirementbenefitobligations 8,063 13,054 10,894 37,592 45,384

Currentincometaxliabilities 3,740,849 3,551,266 2,497,527 2,525,410 3,600,987

Otherborrowedfunds 700,000 2,285,714 2,486,000 - -

Otherliabilities 7,376,514 6,930,799 6,330,374 7,208,701 10,234,124

Provisions 58,488 58,488 58,488 8,488 10,734

Deferredincometaxliability - 782,923.62 - 537,740 400,406

Totalequity 50,260,687 49,272,392 39,522,838 41,737,733 42,461,727

Duetootherbanks - - - 3 78,104 14

On-lendingliabilities - - - 344,000 -

Total equity and liabilities 340,321,432 323,586,324 367,136,624 258,912,344 181,866,397

Creditcommitmentsandother

financialfacilties 56,189,598 62,277,919 54,837,495 53,150,071 59,949,539

CONSOLIDATED UNAUDITED FIVE YEAR FINANCIAL SUMMARYFOR THE YEAR ENDED 31 DECEMBER 2013

113112

Netoperatingincome 28,573,453 28,157,312 21,547,410 18,496,841 23,105,344

Operatingexpenses (11,304,892) (11,072,735) (9,588,588) (7,872,421) (7,454,962)

Netcreditlosses (436,536) (241,971) 375,477.77 - -

Write-back/(allowance)

onriskassets - - - 1,103,881 18,890


accountedforusingequitymethod 78,197 56,652 42,063.23 - -

Profitbeforetax 16,910,222 16,899,258 11,625,408 11,728,301 15,669,272

Incometaxexpense (3,267,092) (3,874,866) (2,243,804) (2,674,075) (3,778,797)

Profitfortheyear 13,643,130 13,024,392 9,381,604 9,054,226 11,890,475

Othercomprehensiveincomefor

theyear,netoftax (1,858,058) 4,788,575 2,025,917.27 - -

Totalcomprehensiveincome

attributabletoshareholders 11,785,072 17,812,967 7,355,686.71 - -

Earningspershare 495k 476k 343k 324k 426k

Declareddividendpershare 395k 295k 275k 350k 255k

NumberofordinarysharesofN1.00 2,793,777 2,793,777 2,793,777 2,793,777 2,793,777

IFRS IFRS IFRS NGAAP NGAAP

2013 2012 2011 2010 2009

N’000 N’000 N’000 N’000 N’000

STATEMENT OF COMPREHENSIVE INCOME

2013 IN PICTURES

financial reports - citigroup.com · mr. michael murray-bruce has an indirect shareholding through...

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