Word: citibank
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Dates: during 1970-1979
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...early 1960s, banks further began to concentrate on "liability management"-the concept of borrowing money to relend it at a higher rate. Citibank developed the negotiable certificate of deposit-a security that offers higher-than-usual interest to a corporation or individual investor willing to leave money in the bank for a fixed period, such as one year. If an investor wants his money back sooner, he can sell the CD to someone else. Formally, the money is a deposit; actually, it is a loan to the bank. Banks also began borrowing from the huge pool of Eurodollars held abroad...
...economic growth than the legendary gimlet-eyed banker of old, who would grant a loan only to a borrower who could prove that he did not need one. That, at least, is the central argument of Walter Wriston, the strongest champion and exemplar of the new banking. Under Wriston, Citibank has led in international expansion, computerization and the use of large CDs, and it was one of the first to appreciate the diversification possibilities of holding companies. (Citibank today is officially a subsidiary of Citicorp, a holding company also headed by Wriston, which is involved in mortgage banking, leasing...
...Citibank is still innovating, currently most aggressively in electronic banking-a field that gives promise of eventually creating a "checkless society," in which funds are switched easily and automatically from one account to another. While that prospect is far in the future, the bank's Citicard system is spurring some interesting changes right...
...information about their accounts without bothering to walk up to a teller's window. Within months the terminals were set up in department stores and other retail outlets to enable bank customers to pay for their purchases with personal checks that the merchant could quickly verify. Today Citibank has terminals in more than 2,500 retail outlets, 120 of them across the state line in New Jersey, where it is legally forbidden to open a branch (federal law forbids interstate branching). About 60 banks around the country have followed Citibank's lead and established similar systems...
...enter the bank. Legal fights started by small banking interests in Illinois, Colorado and elsewhere will delay the spread of electronic banking, but probably not stop it. Currency Comptroller Smith has already ruled that terminals located within 50 miles of a bank should not legally be considered branches. Thus Citibank once again is in the forefront of expansion, this time riding what could be the most significant banking trend of the century...