DBRS, Inc. (Morningstar DBRS) confirmed the credit ratings of Citigroup Inc. (Citi or the Company), including the Company's Long-Term Issuer Rating of A (high).

At the same time, Morningstar DBRS confirmed the credit ratings of its primary banking subsidiary, Citibank, N.A. (the Bank). The trend for all credit ratings is Stable. The Intrinsic Assessment (IA) for the Bank is AA (low), while its Support Assessment remains SA1, reflecting the internal support provided by the Company. The Company's Support Assessment is SA3 meaning that timely systemic support is not expected. The Company's Long-Term Issuer Rating is positioned one notch below the Bank's IA.

KEY CREDIT RATING CONSIDERATIONS

The credit ratings and Stable trend reflect the scale, quality and diversity of Citi's franchise. The Company's strong balance sheet fundamentals also provide key support to the credit ratings. The challenges Citi is facing with improving profitability, while rectifying its regulatory Consent Orders and executing its strategy transformation are also factored into the credit ratings. The credit ratings also consider the significant progress Citi has achieved to date in executing on its strategic priorities. Citi's susceptibility to various geopolitical political uncertainties, given its unique global positioning is also taken into consideration. Additionally, Citi is exposed to a wide range of capital markets activities, which support the franchise value, but elevate risk levels.

CREDIT RATING DRIVERS

If Citi delivers on its strategic priorities and consistently generates returns that are more in line with higher-rated peers, the credit ratings would be upgraded. Conversely, a sustained deterioration of earnings or a significant weakening of balance sheet fundamentals would result in a credit ratings downgrade. Any indications of meaningful franchise impairment because of risk management deficiencies or operational missteps would also result in a credit ratings downgrade.

CREDIT RATING RATIONALE

Franchise Combined Building Block (BB) Assessment: Very Strong

With $2.7 trillion in total assets, Citi is the third-largest bank in the U.S. The most global of U.S. banking organizations, Citi is one of only a few banking organizations worldwide with the brand and infrastructure to provide a full range of banking services to multi-national corporations globally. Indeed, the Company's Services segment, which includes its powerful Treasury and Trade Solutions and Securities Services businesses, operates in 180 different markets, serving 85% of the Fortune 500 companies, and processes nearly $5 trillion in payments daily. Additionally, Citi is the third-largest credit card issuer in the U.S. and maintains top-tier global market share positions across investment banking and trading activities.

Earnings Combined Building Block (BB) Assessment: Good/Moderate

Citi's top line has proven resilient, with $85 billion in net revenues in 2025, up 6% year-on-year, including record revenues across all five business lines. Meanwhile, total operating expenses increased 3% primarily due to higher compensation and higher technology / communication expenses. Excluding the impact of the Russia held for sale accounting treatment and the Banamex closing, Citi reported an adjusted return on tangible common equity of 8.8% in 2025, up 180 basis points compared with 2024. While improved, this remains at the bottom of the peer group and a credit ratings constraint. Citi is currently targeting a return on tangible common equity of 10% to 11%, which we view as achievable.

Risk Combined Building Block (BB) Assessment: Strong/Good

While Citi's size and scale provide many benefits, managing risk across such a large, complex organization is a critical challenge. The Company has made steady progress addressing deficiencies cited by regulators, having already closed out a few long-standing consent orders; although more work around data and regulatory reporting remains. Positively, the Company's credit performance remains favorable across regions, with asset quality metrics stable to improved compared with the prior year. Additionally, the allowance for credit losses remains substantial at $19.2 billion, or 2.58% of total loans.

Funding and Liquidity Combined Building Block (BB) Assessment: Very Strong/Strong

Citi's sizable deposit base of $1.4 trillion, which is sourced through various channels, including its retail bank, Treasury and Trade Solutions and Wealth businesses, anchors the Company's sound funding profile. Citi's reliance on wholesale funds primarily reflects its capital markets businesses and is well diversified by geography and investor. Moreover, long-term debt is well-laddered by maturity. Secured funding is done shorter-term, presenting potentially an overnight funding risk, though funding for less liquid assets is typically done on a term basis. Liquidity remains robust, with cash and securities totaling $794 billion at the end of Q4 2025, representing 30% of total assets.

Capitalization Combined Building Block (BB) Assessment: Strong/Good

Citi's capital metrics and internal capital generation provide a sound cushion to absorb unexpected losses. Even after returning approximately $17.6 billion to shareholders in common share repurchases and common dividends during 2025, the Company's Standardized CET1 ratio of 13.2% at year-end, was approximately 160 basis points above its regulatory requirement.

Further details on the Scorecard Indicators and Building Block Assessments can be found at https://www.dbrsmorningstar.com/research/473611.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS

There were no Environmental/Social factor(s) that had a significant or relevant effect on the credit analysis.

Governance (G) Factors

The following Governance factor(s) had a relevant effect on the credit analysis: Morningstar DBRS views the Governance Impact of Corporate/ Transaction Governance ESG subfactor as relevant to the credit rating, but it does not affect the current assigned credit ratings or trends. In October 2020, the Federal Reserve and OCC issued Consent Orders against the Company that cited 'significant ongoing deficiencies', criticizing Citi's systems and controls, and requiring demonstrated progress for remediation. Remediation efforts are ongoing, and the Company continues to incorporate regulatory feedback into these efforts. In December 2025, the OCC removed the July 2024 amendment to the 2020 Consent Order.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (May 16, 2025) https://dbrs.morningstar.com/research/454196.

Notes:

All figures are in U.S. dollars unless otherwise noted.

The principal methodology is the Global Methodology for Rating Banks and Banking Organisations (May 23, 2025) https://dbrs.morningstar.com/research/454637. In addition Morningstar DBRS uses the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (May 16, 2025) https://dbrs.morningstar.com/research/454196 in its consideration of ESG factors.

The following methodology has also been applied:

Morningstar DBRS Global Corporate Criteria (December 19, 2025)

https://dbrs.morningstar.com/research/470156

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

The primary sources of information used for these credit ratings include Morningstar, Inc. and company documents. Other sources include Morningstar Inc., Company Documents. Morningstar DBRS considers the information available to it for the purposes of providing these credit ratings was of satisfactory quality.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

For more information on Morningstar DBRS' policy regarding the solicitation status of credit ratings, please refer to the Credit Ratings Global Policy, which can be found in the Morningstar DBRS Understanding Ratings section of the website https://dbrs.morningstar.com/understanding-ratings

These credit ratings are endorsed by DBRS Ratings Limited for use in the United Kingdom, and by DBRS Ratings GmbH for use in the European Union, respectively. The following additional regulatory disclosures apply to endorsed credit ratings:

The last credit rating action on this issuer took place on February 05, 2025.

The conditions that lead to the assignment of a Negative or Positive trend are generally resolved within a 12-month period. Morningstar DBRS's trends and credit ratings are monitored.

For further information on Morningstar DBRS historical default rates published by the European Securities and Markets Authority (ESMA) in a central repository, see: https://registers.esma.europa.eu/cerep-publication. For further information on Morningstar DBRS historical default rates published by the Financial Conduct Authority (FCA) in a central repository, see https://data.fca.org.uk/#/ceres/craStats.

Lead Analyst: Michael McTamney, Senior Vice President,

Rating Committee Chair: Michael Driscoll, Credit Rating Officer,

Initial Rating Date: March 31, 1978

For more information on this credit or on this industry, visit dbrs.morningstar.com.

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