The Citibank Acquisition Of Confia In Mexico

6001 words - 24 pages

Citibank--The Confia Acquisition in Mexico

Focus: Organizational Integration, Products, Human Resources, and Global Strategy after Acquisition

Introduction

On August 12, 1998, Citibank took full ownership and control of the medium-sized Mexican banking group, Confía, dropping the latter's name and logo from the 280 branches throughout Mexico, and from that point on operating it as part of Citibank Mexico. The road that led to this outcome was rocky to say the least, and the fit of the Mexican bank into Citicorp's global organization and strategy was quite different from what would have been expected only months earlier. This discussion describes the sequence of events involved and the ways in which the process was linked to the organizations and people involved. Before starting into the banks' situations and characteristics, an orientation to the time and place is useful.

The Economic Situation in Mexico during 1994-95

Mexico was one of Citibank's main emerging market customer bases in the early 1990s. After a very rocky relationship through the 1980s, when Mexico's government declared an inability to pay its foreign commercial bank debt, including more than $US 3 billion owed to Citibank, the country had finally returned to a positive growth path and was delivering solid profits to Citibank in both corporate/institutional banking and retail banking. Mexico's economy grew at an annual rate of more than 5% during the 1990-1994 periods. However, the problems of an overvalued currency, heavy inflow of financial investments into high-yield Mexican securities, and political events in 1994 produced a dramatic decline of confidence in Mexico. Mexican and foreign investors saw the January uprising in Chiapas against Mexico's central government, and then the March assassination of the designated presidential candidate (Luis Donaldo Colosio) of the main political party (PRI), as bad news sufficient to cause a massive capital outflow from the country. The Central Bank was forced to use up most of its official foreign exchange reserves during 1994, such that by December there were less than two months' worth of reserves left to cover imports. This situation, coupled with the policy of keeping the peso in a controlled and slow decline in value relative to the dollar, produced the infamous decision to devalue on December 20, 1994. The newly elected government of Ernesto Zedillo shifted the peso/dollar band 15% lower, touching off another huge speculative outflow of funds. A subsequent decision to let the peso float freely against the

dollar complicated matters and the peso dropped from 3.4 pesos per dollar to more than 7 pesos per

dollar, where it remained for most of 1995.

2 A07-00-0020

This preceding series of events, called the Tequila Crisis, affected Citibank and all other banks in

Mexico very directly and very negatively in 1995. Obviously, for foreign banks such as Citibank, the

devaluation of the peso meant that...

Find Another Essay On The Citibank Acquisition of Confia in Mexico

The effect of Repetition in the acquisition of Knowledge

1269 words - 5 pages "What I tell you three times is true." (Lewis Carroll). Might this formula- or a more sophisticated version of it- actually determine what we believe to be true?As we draw hypotheses and conclusions throughout our lives, we are bombarded and influenced by the perceptions, opinions, and accepted facts of other people. As we learn from a young age, we accept the opinions, findings, and discoveries of experts and professionals, who specialize in

The influence of Noam Chomsky in child language acquisition

2599 words - 10 pages The influence of Noam Chomsky in child language acquisitionNoam Chomsky dominated the world of linguistics like a colossus for decades after the late fifties. My main aim of this essay is to discuss his influence in the area of child language acquisition and inspect to see if his influence is waxing or waning. After that I will examine the reasons behind the increase or decrease of his influence. I will be relating back every so often to

The Deepwater Horizon Oil Spill in the Gulf of Mexico

622 words - 3 pages On April 20, 2010, the event of the Deepwater Horizon Oil Spill in the Gulf of Mexico caused 11 employees’ death, and around 35000 to 60000 barrels of oil were pouring into the ocean every day. Facts have been proven that any crisis must go along with the lack of risk management. Offshore oil drilling work is a high-risk occupation which requires strict obedience to the risk control management without any carelessness. In response to the

The Importance of Language Acquisition

2042 words - 8 pages The Importance of Language Acquisition *Missing Works Cited* It is known, even to a person to whom the entire study of language isn't familiar, that the language is the greatest factor on which most of the human activities depend. Without any form of language, any cooperation and communication would be almost, if not totally impossible (World Book Encyclopedia 62). This significance of language is what draws scientists to study origin

Deepwater Horizon Oil Spill in the Gulf of Mexico

1006 words - 4 pages and causing the largest offshore oil spill in United States history. While the deeply human tragedy is already readily apparent – 11 dead and 17 injured – the full ramifications of the Deepwater Horizon disaster have yet to be realized. Beyond the economic and environmental impact, the Deepwater Horizon spill is likely to be an unprecedented incident for public health. Millions of gallons of crude oil have gushed into the Gulf of Mexico since

Deepwater Horizon Oil Spill in the Gulf of Mexico

1211 words - 5 pages a spill fifty times larger than the one currently plaguing the Gulf of Mexico, yet they still have not shown any firm, pre-meditated plans for the cleanup of the coastal waters. So when Mr. McKay testified that the Transocean blowout preventer "failed to stop the leak", one must wonder how this is in any way significant to the situation at hand (Clayton, 2010, p. 1 par. 3). Rather than shifting the blame to a contractor in charge of the oil

The Tlatelolco Massacre in Mexico

538 words - 2 pages 1968 was an especially volatile year in many countries around the world. In France, the United States, and Mexico, youth and leftist rebellions escalated to previously unseen levels of violence. In the summer of 1968, Mexican students began to demonstrate against the government of President Diaz Ordaz, and were later joined in this movement by labor unions and the working class. The impending Summer Olympics provided the demonstrators with more

The Bourbon Reforms in Mexico

1451 words - 6 pages and trade, with so many restrictions and regulations it is no mystery why the masses revolted. Bourbon rule set the circumstances for the Independence of Mexico that occurred almost a hundred years later. The arrogance of the Bourbon Monarchy is shocking, the racial discrimination and exploitation of so many was no doubt reason enough for a revolution of such a magnitude that took place in Mexico.I believe that there Bubonic Reforms can be linked

An Examination of the Dogme Method of Language acquisition in English Language Teaching

1292 words - 5 pages Initially Dogme is a filmmaking technique established in 1995 by a group of Danish directors when they tried to create more successful films with fewer preparations. Meddings and Thornbury (2009, 104) state that “Dogme demands that no props are introduced to the authentic film location…and the sole use of hand-held camera”. Eventually this technique was obtained as a teaching method since sometimes teachers may face a lack of materials which can

Review Of "the City Of Mexico In The Age Of Diaz"

1074 words - 4 pages The Great Divide University of California-Berkley geographer and author Michael Johns argues in his novel, The City of Mexico in the Age of Diaz, that the central Zocalo of Mexico City does more than geographically segregate the East from the West, but Mexico’s national mentality as well. During the years of Diaz’s democratic façade, the upper classes thrived upon plantation exports, feudalist economics and the iron fist of Diaz’s rurales

Exploring the Role of Women in Mexico in Like Water For Chocolate

2655 words - 11 pages Like Water For Chocolate by Laura Esquivel explains women’s roles in northern Mexico during the turn of the nineteenth century. The novel takes place in northern Mexico on a family ranch where many family traditions are carried out. Also, the novel describes some of the typical foods that were prepared and fiestas that were celebrated in the Mexican culture around this time. However, the novel mainly focuses on the roles of females in Mexican

Similar Essays

The Process Of Language Acquisition In Childhood

2953 words - 12 pages the ability to learn the fictional language. Phonological Development In the first years of life children transcend from infancy, in which they cannot speak nor comprehend language, to age four in which they begin to be able to express themselves in their own language (Hoff, 2006). Overall, the language acquisition process has the same endpoint for all capable children. The only difference in the language acquisition process between children is

The Struggle Of Eznl In Modern Mexico

4655 words - 19 pages The Struggle of EZNL In Modern Mexico Introduction In so few words, the Zapatistas are a people united in the struggle for the rights and dignity of the indigenous people of Mexico. They are a group composed of the natives to the land of the state of Chiapas, the southernmost and poorest state in Mexico, which primarily consists of the tribes of the Mayan peoples. The conditions that these indigenous people live in are a testament to

The Annexation Of Mexico Essay

3751 words - 15 pages to give up certain freedoms because of how that society is set up. With the acquisition of Mexico, a lot, if not all people, will have to give up freedoms that they had at some point in time. Stability is only possible when all of the masses agrees and assimilates nicely into the new system. With more people, that means more power. More power means more stability if run properly. More stability is a greater chance at an opportunity. That

The History Of Mexico Essay

2408 words - 10 pages The History of Mexico Before the Spanish Mexico was occupied by a large number of Indian groups with very different social and economic systems. In general the tribes in the north were relatively small groups of hunters and gatherers who roamed large areas of sparsely vegetated deserts and dry lands. These people