TEXT - Fitch rates Citigroup Global Markets Limited
Feb 22 - Fitch Ratings has assigned Issuer Default Ratings (IDRs) of 'A/F1' to Citigroup Global Markets Limited (CGML), a wholly-owned subsidiary of Citigroup Inc. (Citi). A complete list of CGML's ratings follows this release. The Rating Outlook for CGML is Stable, in line with the Outlook for Citi. RATING ACTION RATIONALE The IDRs for CGML and Citi are equalized, which reflects Fitch's view that CGML is core and integral to Citi's business strategy and operations. Fitch believes Citi would fully support CGML in the event of need. CGML is Citi's international broker-dealer, based in London, and a critical part of Citi's global operations. CGML's activities cover the broad spectrum of investment banking and capital market activities including advisory and underwriting; market making in equities, fixed income, and commodities; investment management; and investing/lending activities. Fitch believes there is a high level of management/operational integration between CGML and other core Citi operations. CGML maintains comfortable liquidity and capitalization, which are augmented by the capacity to tap liquidity and additional capital from Citi in the event of need. RATING DRIVERS AND SENSITIVITIES - IDRS and Senior and Short-Term Debt Given Fitch's view that CGML is a core subsidiary of Citi, CGML's IDRs would change in conjunction with any changes to Citi's IDRs. In the unlikely event that Fitch no longer considers CGML to be a core part of Citi's operations, CGML's IDRs could be negatively affected. Citi's IDRs were affirmed on Oct. 10, 2012 with a Stable Outlook as part of Fitch's Global Trading and Universal Bank (GTUB) periodic review. The standalone Viability Rating continues to be supported by Citi's diverse revenue mix, conservative liquidity management, and improved capital position. Challenges include a still sizeable level of nonperforming loans and noncore assets, as well as modest levels of profitability. Citi's Long-term IDR, and consequently CGML's Long-term IDR, would be affected by a change in the Support Rating Floor. Citi's current 'A' Long-term IDR is above its standalone Viability Rating of 'a-', reflecting the fact that Citi's IDR benefits from support. The '1' Support Rating, and 'A' Support Rating Floor for Citi factors in government support in the event of need for Citi and other U.S. G-SIFIs. The ratings for CGML presume that any support that would be offered to Citi would also be extended to CGML. Citi's and CGML's ratings could be negatively pressured if Fitch's view of its support changes. For additional details, see 'Fitch Affirms Citigroup Inc's Ratings; Outlook Stable' dated Oct. 10, 2012, and available at www.fitchratings.com. RATING DRIVERS AND SENSITIVITIES - Subsidiary and Affiliated Company Rating The review of CGML factors in a high probability of support from its parent, Citi. It considers the high level of integration, brand, management, and financial and reputational incentives to avoid subsidiary defaults. Fitch assigns the following ratings with a Stable Outlook: Citigroup Global Markets Limited --Long-term IDR 'A'; --Short-term IDR 'F1'; --Senior unsecured long-term notes 'A'; --Short-term debt at 'F1'.