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Public Meeting Regarding Citicorp and Travelers Group
Thursday, June 25, 1998
Transcript of Panel Twelve

  22               Next panel will be panel 12, Patricia

  23     O'Neill Galin, Raymond C. Bowen, Amalia

  24     Betanzos, Sue Bastian and Peter Barnett.

  25               Ms. Galin, you're first on my list.


   2               MS. GALIN:  Ladies and gentlemen,

   3     thank you for the opportunity to speak to you

   4     regarding the acquisition of Citibank.  My name

   5     is Patricia O'Neil Galin, and I am the

   6     executive director of the These Our Treasures

   7     in the Bronx.  We are a not-for-profit agency

   8     serving youngsters and families for the past

   9     twenty-five years.

  10               Twenty-five years ago there were many

  11     banks to choose from regarding loans, credit

  12     lines, et cetera.  Citibank was the only

  13     banking institution who considered loans and

  14     the credit line for this Bronx organization.

  15               Citibank continues twenty-five years

  16     later to be a major influence in the Bronx

  17     community, and more particularly has helped

  18     These Our Treasures with our vision and mission

  19     to provide services to young disabled children

  20     and their families.

  21               As we have grown since 1973 with

  22     children and families and a budget of $288,000

  23     to a budget of over three and a half million

  24     dollars, Citibank has influenced our growth and

  25     has truly been a friend to TOTS.


   2               Thank you.

   3               MR. LONEY:  Mr. Bowen.

   4               MR. BOWEN:  Good afternoon, members

   5     of the Federal Reserve Board, ladies and

   6     gentlemen.  My name is Raymond C.  Bowen,

   7     president of the LaGuardia Community College of

   8     the City University Of New York.  I am here

   9     today to speak on behalf of LaGuardia and its

  10     long-standing relationship with Citibank.

  11               LaGuardia Community College, the

  12     youngest institution in the City University,

  13     enrolls about 33,000 students, 11,000 in the

  14     degree programs and 22,000 in noncredit

  15     programs.

  16               Our student body is comprised of

  17     individuals who are 37 percent Hispanic, 20

  18     percent black, 15 percent white, 13 percent

  19     Asian, 2 percent native American and 4 percent

  20     other, making us one of the most diverse higher

  21     educational institutions in America.

  22               Also noteworthy is the fact that 66

  23     percent of our students are women.  About 75

  24     percent of our new students reported family

  25     incomes under $20,000.  Most are on their own


   2     and in need of work in order to support

   3     themselves.  Many of our students work while

   4     they are enrolled at LaGuardia, 46 percent

   5     part-time and 54 percent full-time.

   6               We have the fifth largest foreign

   7     student enrollment of any Community College in

   8     the country.  Our students are drawn from over

   9     135 countries speak 85 languages other than

  10     English.  For several consecutive years

  11     LaGuardia Community College has ranked among

  12     the top community colleges in the country in

  13     graduating minority students.

  14               In 1977 LaGuardia ranked fifth among

  15     the nations two-year institutions in awarding

  16     degrees to minorities.  Priority initiatives

  17     for the college include cultural pluralism,

  18     economic development, and international

  19     education.

  20               LaGuardia has also been recognized by

  21     the US Department of Education as a model

  22     Community College both nationally and

  23     internationally.  As a collaborative

  24     partnership between the college and the New

  25     York City Board of Education LaGuardia hosts


   2     three model high schools on its campus; the

   3     Middle College High School creates a unique

   4     educational opportunity for students who are at

   5     risk of dropping out; the International High

   6     School serves recent immigrants from numerous

   7     countries by offering a comprehensive secondary

   8     curriculum while developing students oral and

   9     written English language competence, and the

  10     Robert F.  Wagner Institute for Arts and

  11     Technology, a New Visions school that takes the

  12     standard core curriculum and melds art and

  13     technology into every phase.

  14               From its inception LaGuardia

  15     Community College has been a cooperative

  16     education institution based on the premise that

  17     learning should take place in a variety of

  18     settings both inside and outside the classroom.

  19               The cooperative program is designed

  20     to help students determine their individual

  21     goals, explore various career options, apply

  22     classroom learning to real work situations, and

  23     strengthen interpersonal and technical skills.

  24               LaGuardia Community College has the

  25     largest cooperative education program of all


   2     two-year institutions.  This collaboration will

   3     have a dynamic impact on the lives of the

   4     students and families that LaGuardia serves and

   5     we look forward to many new positive ventures.

   6               Needless to say that we at the

   7     college are extremely excited to learn that

   8     Citicorp and the Travelers Group have made a

   9     ten year commitment of $115 billion to lending

  10     and investing in low and moderate income

  11     communities and small businesses.

  12               In addition to providing special

  13     pricing to low and moderate income consumers

  14     interested in commercial and homeowner

  15     insurance coverage, I was particularly

  16     interested in the financial and technological

  17     literacy program proposed in this merger.

  18               As an urban educator I also agree

  19     along with both Citicorp and Travelers Group,

  20     that consumers need financial and technical

  21     skills, as well as access to superior products

  22     and services, if they are to achieve financial

  23     well being.

  24               The opportunity for educators to join

  25     an advisory panel on financial literacy who


   2     will assist the bank in understanding the

   3     problems of this diverse population, and to

   4     ultimately develop effective solutions to meet

   5     their needs is critical and warranted endeavor.

   6               Citibank is no stranger to LaGuardia

   7     Community College.  Whether supporting programs

   8     for our older adults on wellness and consumer

   9     education, or providing funding for our college

  10     for childrens programs, over the years,

  11     Citibank grants have helped all segments of our

  12     population.

  13               In our high schools, Citibank has

  14     been a responsive partner in addressing the

  15     need for SAT test preparation, in preparing our

  16     students to enter the world of finance, and in

  17     understanding the responsibilities associated

  18     with savings, credit and money management.

  19     Citibank has provided our students with hands

  20     on exposure to financial curricula that the

  21     college was unable to offer.

  22               They have also supported many

  23     cultural events through our Academic Excellence

  24     Program.  Citibank has also been involved in

  25     our Talent Search Program which is a


   2     comprehensive support service program designed

   3     to facilitate access to post-secondary

   4     institutions for low income and first

   5     generation college students from Western

   6     Queens.

   7               I am proud to say that during this

   8     academic year nineteen LaGuardia students have

   9     been hired as interns at various Citibank

  10     locations, including Court Square, Wall Street

  11     and Citicorp Center, and five LaGuardia

  12     graduates have accepted permanent employment.

  13               Three students have been hired as

  14     interns in a partnership between Citibank and

  15     Cushman & Wakefield for this summer.  In

  16     addition, a permanent annual donation of $3,000

  17     has been given to LaGuardia's Partners in

  18     Cooperative Education for scholarships.

  19               Citibank administrators and staff

  20     have worked hand in hand with LaGuardia

  21     Community College over the past 25 years as a

  22     mentor, sponsor and a friend.

  23               On behalf of LaGuardia Community

  24     College, its faculty, staff and students and

  25     alumni, I am proud to support the merger of


   2     Citibank and Travelers Group and look forward

   3     to benefits of this merger which will bring to

   4     many of our students and various programs who

   5     depend upon us and Citibank to help them to

   6     fulfill their dreams.

   7               Thank you for this opportunity to

   8     speak on behalf of LaGuardia Community College

   9     for the proposed merger between Citibank and

  10     the Travelers Group.

  11               MR. LONEY:  Thank you, Mr. Bowen.

  12               Ms. Betanzos.

  13               MS. BETANZOS:  Thank you.  Good

  14     afternoon.  My name is Amalia Betanzos, and I

  15     offer this testimony in support of the proposed

  16     acquisition by Travelers Group with Citicorp.

  17     I am the president and CEO of the Wildcat

  18     Service Corporation, a not-for-profit human

  19     service agency which has provided training and

  20     employment opportunities to more than 70,000

  21     New Yorkers since 1972.

  22               Our agency assists the most

  23     disadvantaged and underserved populations in

  24     the city, including ex-offenders, ex-addicts,

  25     long-term welfare recipients and at-risk youth.


   2               Travelers group's illustrious history

   3     has been punctuated by providing continuing and

   4     generous support to a growing number of diverse

   5     communities and their residents throughout the

   6     country.  Travelers' commitment to increasing

   7     the capacity and well being of the

   8     disadvantaged and its commitment to community

   9     is unsurpassed.

  10               This commitment permeates throughout

  11     the Travelers organization's staff and its

  12     subsidiaries.  Our own experience at Wildcat is

  13     demonstrative.  This year, Salomon Smith

  14     Barney's MIS staff contributed furniture and

  15     computer equipment and volunteered hundreds of

  16     hours of time to help Wildcat fill the computer

  17     training lab at a shelter for battered women on

  18     the lower east side of Manhattan.

  19               This one of a kind effort has become

  20     a model for enabling shelter-bound residents to

  21     receive much needed job skill training without

  22     the cost or the risk of traveling throughout

  23     the city to attend school, and serves as an

  24     example of what private industry can do to help

  25     those with multiple barriers to employment.


   2               In addition, three years ago, two

   3     years prior to the enactment of the historic

   4     new federal welfare reform legislation, Smith

   5     Barney, now Salomon Smith Barney a Travelers'

   6     subsidiary pioneered with Wildcat in an

   7     innovative training and employment program for

   8     single mothers receiving welfare.

   9               Approximately one year ago Travelers

  10     lent its full support to begin that program

  11     with two other subsidiaries, Commercial Credit

  12     Company in Baltimore and Primerica Financial

  13     Services in Atlanta, Georgia.  These welfare

  14     women after six months training, three months

  15     with Wildcat and three months of internship

  16     with Travelers Smith Barney, get jobs that

  17     average $24,000.  It really is wonderful to

  18     contemplate that these women who were on

  19     welfare and had no hope of getting off welfare

  20     after one year now own Travelers stock in

  21     addition.

  22               Despite these accomplishments,

  23     Travelers was not content to see the program

  24     nourish only with within its own corporate

  25     sphere, and so the senior management has


   2     recently reached out to sister companies and

   3     competitors in the financial services industry,

   4     and has brought five additional Wall Street

   5     giants together to develop similar programs

   6     with Wildcat.  This is as unique and unselfish

   7     and undertaking as I've seen in my thirty years

   8     in public office and private enterprise.

   9               Travelers has demonstrated time and

  10     time again as it expands, so do the benefits

  11     and opportunities that accrue to every member

  12     of the community in which it develops roots,

  13     and in particular to the most disadvantaged and

  14     marginalized youth and adult residents of these

  15     communities.

  16               I am confident that this merger with

  17     Citi will bring the strength of Travelers and

  18     the strength of Citicorp together.  Citicorp

  19     also has had a wonderful record of dealing with

  20     nonprofit organizations and helping to employ

  21     welfare recipients in their banks, and we are

  22     currently working on a program that started way

  23     before merger talk, to make sure that more

  24     Wildcatters who will be fully trained by

  25     Citibank and by Wildcat, will have the


   2     opportunity to really remake their lives.

   3               I'm certain that consistent with both

   4     their long history of expanding assistance to

   5     the needy as they expand their only commercial

   6     activities, the acquisition of Citicorp by

   7     Travelers will provide a new generation of

   8     support and an extended commitment to assist

   9     those most in need and, therefore, I urge the

  10     acquisition be approved.

  11               Thank you.

  12               MR. LONEY:  Thank you.  Ms. Bastian.

  13               MS. BASTIAN:  Yes.  Good afternoon

  14     Federal Reserve Board members, ladies and

  15     gentlemen.

  16               I am here as the president of

  17     Teaching Matters Inc. to describe our

  18     relationship with the Citicorp Foundation.

  19     Teaching Matters Inc., CMI is a New York City

  20     based nonprofit organization founded four years

  21     ago by Elizabeth Ruletin.

  22               Our mission is to help teachers in

  23     the New York City public schools learn to use

  24     the technology that is everywhere in a creative

  25     and effective way to strengthen student


   2     performance.

   3               To date we've served over 350 schools

   4     and this year we're working in 190 schools.  We

   5     send approximately 35 to 40 teacher trainers in

   6     technology into the five boroughs everyday.

   7               Our recent accomplishments were to

   8     work with the Board of Ed to write their

   9     strategic development plan for technology.

  10     We're funded, proud to say, by Annenberg and

  11     J.P. Morgan, and Seagram's, and we are

  12     partnership in the Department of Education

  13     challenge grant.

  14               We have at TMI a three year history

  15     of collaboration with Citibank which began in

  16     1995 with their support of $140,000 for the

  17     first CitiTech series gateway to technology

  18     planning for high school educators.  We felt

  19     that the principals of the schools were being

  20     left out of the education everyone needs about

  21     what to do with this puzzling phenomenon called

  22     technology, telecommunications and the

  23     computer.

  24               The series provided a leadership

  25     institute for staff and for leaders in the


   2     metropolitan area, including Westchester and

   3     Long Island.

   4               We followed that kind of initial

   5     exposure up with very regular visits to those

   6     schools.  Because of the attendees enthusiasm

   7     for the quality of training they received,

   8     Citibank funded us for a second year.  The

   9     second series reached 30 high schools, the

  10     first one I believe approximately 35.

  11               The bank's commitment again was

  12     approximately $140,000.  Last year we were

  13     pleased to receive a third grant from Citibank

  14     foundation for new thinking, new teaching,

  15     technology across the curriculum in order to

  16     bring the curriculum into subject matter area,

  17     and not have technology be an end in itself.

  18               We target the mayor's project smart

  19     principals this year and the teachers.  We're

  20     working with 110 teachers in two districts.

  21     Through their banking on education programs

  22     Citibank's contribution has been significant.

  23               The Foundation's ongoing commitment

  24     is evident time and time again to the public

  25     school.  Their contributions have been careful,


   2     informed and comprehensive.  They focused both

   3     on the principal and the classroom teacher many

   4     of whom are in underserved neighborhoods.  It

   5     is our belief that the Citicorp Foundation has

   6     helped establish the standard of what good

   7     corporate philanthropy is all about.

   8               Thank you.

   9               MR. LONEY:  Thank you, Ms. Bastian.

  10     Mr. Barnett.

  11               MR. BARNETT:  That was the cry of the

  12     poor.  A lot of people don't want to hear it.

  13     A lot of people can't hear it, and Glenn, Scott

  14     and James and Barbara, I want to tell you that

  15     Citibank is one of the few places that hears

  16     the cry of the poor and the needy and does

  17     something about it.

  18               I can remember a very poor community

  19     out on Long Island called Wyandanch and on that

  20     community there are many poor and homeless

  21     families.  On Long Island if you're a mother

  22     with three children you need to have about

  23     $30,000 a year to come in to survive on Long

  24     Island to have a decent house, food and a junk

  25     car to get around in.


   2               What Citibank does is care about

   3     other people.  I really don't know the

   4     corporation, but I know what Citibank has in

   5     one person.

   6               I've been working with a woman named

   7     Michelle Debenedetto who is an employee of

   8     Citibank and her main job is to look around at

   9     the communities of Long Island and say, what is

  10     needed?  What can the not-for-profit groups do

  11     to help the poor and needy of Long Island?  And

  12     she does it.

  13               She is a mother with a great heart

  14     and she represents what I feel is what's needed

  15     in America today with corporations, to help

  16     those who are in need, and Citibank is one of

  17     those groups that does that.

  18               (Continued on next page)









   2               MR. BARNETT:  Wynandach Homes &

   3     Properties is my nonprofit that builds and

   4     renovates houses for homeless women.  We take

   5     them out of the shelter, we take them out of

   6     their cars, we take them out of tents that they

   7     are living in and we give them a clean, decent

   8     place to live.  Then we help them get educated.

   9     We help them get into GED programs.  We help

  10     them get their AA degree at Suffolk Community

  11     College.  We help them get a decent job where

  12     they are on the road to making that $30,000.

  13               Citibank over ten years ago -- when I

  14     was just starting, just starting to get some

  15     money to do funding -- gave us the money to

  16     hire a summer intern, a woman that later we

  17     were able to hire full time; again, with help

  18     from Citibank, to work with these mothers to

  19     bring them from welfare to being

  20     self-sufficient women taking care of their

  21     families, with their degrees, getting a chance

  22     to make their AA degree.

  23               One of the things I find that with

  24     these mergers -- and we are not going to stop

  25     it; I was reading today another AT&T and


   2     Cablevision merging -- they are happening.  It

   3     is the way companies are stabilizing these

   4     days.  And what I am hoping to see with

   5     Citibank's merger is that they are going to

   6     create a very strong bank and they are going to

   7     create a very strong corporation that is going

   8     to have a heart, it is going to have the heart

   9     of Michelle DiBenedetto, because she's there

  10     and she's going to tell the banks and tell

  11     Travelers, you've got to stay committed to

  12     helping the poor and the needy.  I think that

  13     is what is going to happen.

  14               The Federal Reserve Bank two years

  15     ago started a program called LIHPPI.  It was

  16     called the Long Island Home Purchasing Process

  17     Initiative.  They helped bring together all

  18     sorts of banks and nonprofits on Long Island,

  19     saying how can we help people in minority

  20     communities, people who are just making that

  21     $30,000 buy a house on Long Island.  Citibank

  22     through its funding and its creative work with

  23     Michelle and other people that she brought in

  24     from Citibank created pamphlets, that we are

  25     getting into every library, every school on


   2     Long Island, "Breaking the Barriers to Home

   3     Ownership, Guides to Purchasing a Home."  These

   4     are things that are needed.  These were worked

   5     out with not-for-profit groups like myself to

   6     help them make a difference.

   7               One of the things I find is that many

   8     corporations need to hear the poor.  They need

   9     to hear the voice of the needy.  And one of the

  10     things that Citibank will do is help bring that

  11     about.  As they grow and develop, I have no

  12     doubt that they are going to help people hear

  13     that voice, people to care about the needy.

  14               There was a speech given by Carl

  15     Messenger to the United Nations in 1981 -- I

  16     will just end with this -- where he spoke to

  17     corporate America and said:  In corporate

  18     America, as you prosper, you can't just get up

  19     there all by yourself, but you have to help

  20     those rise with you, and we have to learn that

  21     we all have to rise together.  If one segment

  22     of our society gets up there all by itself, it

  23     will tackle.  It can't handle the attitude.

  24     You have to bring everybody else up with you.

  25               Carl Messenger said it this way, and


   2     I believe that Citicorp believes in this:

   3     People are unreasonable, illogical,

   4     self-centered; love them anyway.  If you do

   5     good, people will accuse you of selfish

   6     ulterior motives; do good anyway.  If you are

   7     successful, you will win false friends and true

   8     enemies; try to be successful anyway.  The good

   9     you do today will be forgotten tomorrow; do it

  10     anyway.  Honesty and frankness make you

  11     vulnerable; be honest and frank anyway.  People

  12     favor underdogs, but I notice they follow the

  13     top dogs; fight for some underdogs anyway.

  14     What you spend years building may be destroyed

  15     overnight; build anyway.  People really need

  16     help, but they may attack you if you help them;

  17     try to help people anyway.  Give the world the

  18     best you have and you'll get kicked in the

  19     teeth; give the world the best you have anyway.

  20               Thank you.

  21               MR. LONEY:  Thank you.  I like that.

  22               Any questions from the panel?  If

  23     not, then I will thank you for coming and

  24     sharing your experiences with us.

  25               We are going to take a 15-minute


   2     break and be back at 4:25.


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