(1)Goodwill impairment of $535 million (approximately $489 million after-tax) was incurred in the Asia Consumer reporting unit of Legacy Franchises due to the re-segmentation and timing of divestitures recorded in the first quarter.

(2)Primarily relates to Citi’s agreements to sell its consumer banking businesses in Malaysia, Thailand, Indonesia, Vietnam, Taiwan, India and Bahrain within Asia Consumer, during the first quarter of 2022 and reclassified as HFS as of March 31, 2022. See Note 2.

Citi tests goodwill for impairment annually as of July 1 (the annual test) and through interim assessments between annual tests if an event occurs or circumstances change that could more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. The results of the 2021 annual impairment test resulted in no impairment.

As discussed in Note 3, effective January 1, 2022, as part of its strategic refresh, Citi made changes to its management structure, which resulted in changes in its operating segments and reporting units to reflect how the CEO, who is the chief operating decision maker, intends to manage the Company, allocate resources and measure performance. Goodwill balances were reallocated across the new reporting units based on their relative fair values using the valuation performed as of the effective date of the reorganization. Further, the goodwill balances associated with certain Asia Consumer businesses within the Legacy Franchises operating segment were reclassified to HFS as of March 31, 2022. See Note 2 for a discussion of Citi’s divestiture activities.

The reorganization of Citi’s reporting structure and the announced sales of businesses within a reporting unit were identified as triggering events for purposes of goodwill impairment testing. Consistent with the requirements of ASC 350, interim goodwill impairment tests were performed that resulted in an impairment of $535 million to the Asia Consumer reporting unit within the Legacy Franchises operating segment, due to the implementation of Citi’s revised operating segments and reporting units, as well as the timing of mutual execution of sales agreements for Asia consumer banking businesses. This impairment was recorded in the first quarter of 2022 as an operating expense. The interim goodwill impairment tests were performed using a combination of the income approach, market approach and bids from buyers, where available, to determine the fair value of its reporting units.

During the second quarter of 2022, Citi’s Banking reporting unit within the ICG operating segment was negatively impacted by the industry-wide decline in investment banking activity and macroeconomic challenges

and uncertainties. These conditions resulted in a corresponding decline in the operating results of the Banking reporting unit as of June 30, 2022 and were identified as a triggering event for purposes of goodwill impairment testing. Consistent with the requirements of ASC 350, interim goodwill impairment tests were performed that resulted in no impairment of the Banking reporting unit within the ICG operating segment. The results of the impairment test showed that the fair value of the Banking reporting unit as a percentage of its carrying value was 102%, with the carrying value including approximately $1.5 billion of goodwill. No other events or circumstances were identified for any other reporting unit as a triggering event for purposes of goodwill impairment testing.

The interim goodwill impairment test was performed using a combination of the income approach and market approach to determine the fair value of its reporting units.

Under the market approach, Citi estimated fair value by comparing the business to similar businesses or guideline companies whose securities are actively traded in public markets. Under the income approach, Citi used a discounted cash flow (DCF) model in which cash flows anticipated over several periods, plus a terminal value at the end of that time horizon, are discounted to their present value using an appropriate rate that is commensurate with the risk inherent within the reporting unit.

The key assumptions used to determine the fair value of Citi’s reporting units consisted primarily of significant unobservable inputs (Level 3 fair value inputs), including discount rates, estimated cash flows, growth rates, earnings multiples and/or transaction multiples of similar businesses or guideline public companies, and bids from buyers. The DCF method employs a capital asset pricing model in estimating the discount rate based on several factors including market interest rates, and includes adjustments for market risk and company-specific risk. Estimated cash flows are based on internally developed estimates and the growth rates are based on industry knowledge and historical performance.

Based on the interim impairment tests, the fair values of all of Citi’s other reporting units as a percentage of their

allocated carrying values ranged from approximately 102% to 267%, resulting in no further impairment recognized as of June 30, 2022.

While the inherent risk of uncertainty is embedded in the key assumptions used in the valuations, the economic and business environments continue to evolve as management implements its strategic refresh. If management’s future estimate of key economic and market assumptions were to differ from its current assumptions, Citi could potentially experience material goodwill impairment charges in the future.

See Note 3 for a description of Citi’s operating segments. For additional information regarding Citi’s accounting policy for goodwill and its related goodwill impairment testing process, see Note 1 to the Consolidated Financial Statements in Citi’s 2021 Form 10-K.

Intangible Assets

The components of intangible assets were as follows:


	June 30, 2022						December 31, 2021
In millions of dollars	Gross carrying amount		Accumulated amortization		Net carrying amount		Gross carrying amount		Accumulated amortization		Net carrying amount
Purchased credit card relationships	$	5,514	$	4,357	$	1,157	$	5,579	$	4,348	$	1,231
Credit card contract-related intangibles(1)	3,903		1,440		2,463		3,912		1,372		2,540
Core deposit intangibles	37		37		—		39		39		—
Other customer relationships	362		267		95		429		305		124
Present value of future profits	32		30		2		31		29		2
Indefinite-lived intangible assets	186		—		186		183		—		183
Other	27		4		23		37		26		11
Intangible assets (excluding MSRs)	$	10,061	$	6,135	$	3,926	$	10,210	$	6,119	$	4,091
Mortgage servicing rights (MSRs)(2)	600		—		600		404		—		404
Total intangible assets	$	10,661	$	6,135	$	4,526	$	10,614	$	6,119	$	4,495

(1)Primarily reflects contract-related intangibles associated with the American Airlines, The Home Depot, Costco and AT&T credit card program agreements, which represented 98% and 97% of the aggregate net carrying amount at June 30, 2022 and December 31, 2021, respectively.

(2)See Note 18 for additional information on Citi’s MSRs.

The changes in intangible assets were as follows:


In millions of dollars	Net carrying amount at December 31, 2021		Acquisitions/renewals/ divestitures		Amortization		Impairments		FX translation and other		Net carrying amount at June 30, 2022
Purchased credit card relationships(1)	$	1,231	$	3	$	(70)	$	—	$	(7)	$	1,157
Credit card contract-related intangibles(2)	2,540		—		(77)		—		—		2,463
Core deposit intangibles	—		—		—		—		—		—
Other customer relationships	124		6		(13)		—		(22)		95
Present value of future profits	2		—		—		—		—		2
Indefinite-lived intangible assets	183		—		—		—		3		186
Other	11		30		(17)		—		(1)		23
Intangible assets (excluding MSRs)	$	4,091	$	39	$	(177)	$	—	$	(27)	$	3,926
Mortgage servicing rights (MSRs)(3)	404										600
Total intangible assets	$	4,495									$	4,526

(1)Reflects intangibles for the value of cardholder relationships, which are discrete from partner contract-related intangibles, and includes credit card accounts primarily in the Costco, Macy’s and Sears portfolios.

(2)Primarily reflects contract-related intangibles associated with the American Airlines, The Home Depot, Costco and AT&T credit card program agreements, which represented 98% and 97% of the aggregate net carrying amount at June 30, 2022 and December 31, 2021, respectively.

(3)See Note 18 for additional information on Citi’s MSRs, including the rollforward for the three and six months ended June 30, 2022.