In 1998, Citicorp and Travelers Group made history when they announced their merger, creating the largest financial services company in the world. This merger had a huge impact on the financial system, as it allowed Citicorp to create a global retail franchise and global corporate banking business, while Travelers Group was an investment and insurance conglomerate that had recently acquired Salomon Brothers Inc. The merger also meant that Citigroup had to part with Travelers' property and accident business due to its lower growth rate than other Citigroup units, which put a strain on its stock price. The merger between Citicorp and Travelers Group was the largest corporate combination in history at the time. It allowed the newly formed company to offer banking, insurance, and investment operations in 100 countries.
Travelers Group was the owner of Salomon Smith Barney, the Travelers life, property and accident insurers, and Primerica, a financial services firm. In order to make the largest U. S. financial services company more competitive, President Sanford Weill decided to divide its Travelers Property accident insurance unit as an independent company. The merger between Citicorp and Travelers Group had a huge impact on the financial system.
It allowed Citigroup to create a global retail franchise and global corporate banking business, while also allowing them to offer banking, insurance, and investment operations in 100 countries. The decision to divide its Travelers Property accident insurance unit as an independent company also made the largest U. financial services company more competitive.
