A top executive of Citigroup Inc. said the company is committed to keeping the headquarters of its sprawling consumer credit division in Baltimore, despite its recent agreement to buy Associates First Capital Corp., a large consumer finance company.
CitiFinancial, the consumer credit division previously known as Commercial Credit Co., employs 1,200 people in Maryland - 500 at its headquarters at 300 St. Paul St. Another 500 people work in offices near Baltimore-Washington International Airport and in Owings Mills. Two hundred employees work in 28 CitiFinancial consumer lending branches throughout the state.
"Citigroup remains committed to keeping the headquarters of CitiFinancial in Baltimore," said Robert B. Willumstad, vice chairman of Citigroup's global consumer business. "While it is too early to be able to detail specifics, the acquisition of Associates can only have a positive effect on our business in Baltimore."
Citigroup, a New York-based global financial services giant with $791 billion in assets and 100 million customers, agreed this week to buy Irving, Texas-based Associates in a $31.1 billion stock swap.
Associates is the largest publicly traded finance company in the United States, with managed assets of more than $100 billion and 2,750 offices in this and 13 other countries.
Citigroup expects to take a charge against earnings of $600 million to $700 million as it integrates the two companies.
After the deal closes, Associates' North American consumer finance operations will merge with CitiFinancial. The two companies specialize in lending to middle-income families that need to finance everything from refrigerators to homes.
CitiFinancial has 1,200 branches across the country while Associates has 1,155.
Company officials said Citigroup and Associates are assembling an "integration team" that will make recommendations on how to merge the companies. It is unclear if there will be layoffs, a Citigroup spokeswoman said.
"It is a too early to speculate as to what will happen until the integration team is assembled and makes their decisions," she said.
David Sandor, a spokesman for Associates, said it should take four to six weeks before changes in the structure to the companies are made.
Associates has a small presence in the Baltimore region with about 15 employees, he said. An office in Baltimore rents tractor trailers to independent trucking operators. The company also operates a branch in Glen Burnie and another at Seabrook in Prince George's County that make consumer loans.
Citigroup is headed by Sanford I. Weill, who took over Commercial Credit in late 1986, and used it as the springboard to the helm of Travelers Insurance Co. In April 1998, Travelers merged with Citicorp to form the world's largest financial services company.