[비즈한국] Citibank Korea continues its high-dividend management policy this year. Citibank has recorded a dividend payout ratio exceeding 100% for two consecutive years. Most of these dividends are received by Citibank's U.S. parent entity. Meanwhile, the bank appears to be gradually pulling out of the Korean market, such as by withdrawing from the consumer banking sector. As it reduces investments in the Korean market while paying massive dividends to its U.S. entity, it is facing criticism over the leakage of national wealth.
The Citibank branch of the Korean Financial Industry Union (KFIU) held a '2025 Rally for Victory in Collective Bargaining' on June 26. During the event, the union criticized Citibank's management policy. They argued that while the bank sets excessively high dividend amounts and executives receive massive compensation, the number of branches is being reduced, leading to heightened employment insecurity for staff.
In fact, Citibank has long been known for high dividends. After recording a loss in 2022, the bank skipped dividends, but in 2023 and 2024, it implemented dividend payout ratios around 50%. However, the dividend payout ratio for 2025 reached a staggering 178.46%. Citibank’s net profit for 2024 was 311.6 billion KRW, yet the total dividend payout was 556.1 billion KRW. The bank paid out more money in dividends than it actually earned in net profit.
- Dividend Payout Ratio
- The ratio of the total amount of dividends to net income. Also known as the dividend payment rate or payout percentage. For example, if net income is 10 billion KRW and 2 billion KRW is paid out as dividends, the dividend payout ratio is 20%.
The high-dividend policy was maintained again this year. Citibank's net profit last year was 307.1 billion KRW, and this year's total dividend payout is 383.8 billion KRW. This year, the total dividend once again exceeded net profit. When more money is paid out in dividends than is earned, it inevitably puts a strain on the bank's financial health.
Citibank's largest shareholder is Citibank Overseas Investment Corporation (COIC), which holds a 99.98% stake. COIC is 100% owned by the U.S. entity, Citibank, N.A. Therefore, most of Citibank's dividends are structured to go to the U.S. parent bank. The Korean financial sector criticizes this high-dividend policy as a 'leakage of national wealth.'
Furthermore, Citibank has been reducing investments in Korea since announcing its withdrawal from the consumer banking market in 2021. It is currently proceeding with a phased withdrawal, and in 2025, it signed an agreement with iM Bank to transfer its consumer banking customers to iM Bank.
The number of branches has decreased accordingly, leading to job insecurity. In fact, the number of Citibank employees has fallen compared to the past. According to business reports, the total number of employees at Citibank dropped from 3,494 at the end of 2020 to 1,498 at the end of 2025. While reducing investments and shrinking business in the Korean market, the bank is sending the profits it does manage to earn to the U.S. in the name of dividends.
Yoon Seok-gu, chairman of the KFIU, argued at the rally, "The disappearance of branches means the loss of workplaces for bank employees, which is a fundamental issue threatening the lives and survival of their families. There were 44 branches in the past, now only 9 remain, and there is talk of further closures this year and next." Lee Jang-ho, head of the Citibank branch of the KFIU, also pointed out, "Citibank has earned massive profits for a long time through the blood and sweat of its workers, but those profits are flowing out as high dividends to the overseas headquarters instead of being reinvested domestically."
Citibank maintains that there is no major issue with its high-dividend policy. In deciding this year's dividends, the bank explained, "We maintain an industry-leading level of capital adequacy and have decided to maintain the dividend payout ratio at last year's level after fully considering domestic and international regulatory standards and financial stability. Even after the dividends, our Bank for International Settlements (BIS) capital adequacy ratio significantly exceeds the requirements of supervisory authorities, and we will continue to maintain sufficient liquidity, loan loss provisions, and capital capacity."