Citigroup/Banamex Leads Financiera Compartamos Bond Issue in Mexico with a Partial IFC Credit Guarantee; Standard & Poor's, Fitch Assign Investment-Grade Country Rating.

NEW YORK & MEXICO CITY -- Citigroup/Banamex announced the first issuance of peso-denominated investment grade bonds to finance microfinance activities in Mexico. The proceeds of the transaction, issued on behalf of Financiera Compartamos S.A. de C.V. (Compartamos), a leading Mexican microfinance institution, will be used to fund the entrepreneurial efforts of thousands of Compartamos clients - 94% of them women - primarily in rural communities throughout Mexico.

Citigroup/Banamex successfully issued the first tranche - in the amount of MXN 190 million - of a MXN 500 million program (about $44 million), targeting local institutional investors. A 34% guarantee from International Finance Corp (IFC), the private sector arm of the World Bank Group, enabled the five-year bonds to receive a AA local rating by the local affiliates of Standard & Poor's and Fitch Ratings.

Through this tranche, Citigroup/Banamex and the IFC are helping Compartamos diversify funding sources as Compartamos focuses on achieving its growth plans, which include growing its customer base to one million clients by 2008. This issue was structured by Banamex and Citigroup's Export and Agency Finance team, part of the Structured Finance Group, designed to attract Mexican institutional investors including mutual funds, pension funds, and insurance companies. The placement of bonds for Compartamos was arranged by Acciones y Valores de Mexico, S.A. de C.V. (Accival), the brokerage arm of Banamex.

"We've achieved our client's principal objective - a wide institutional distribution of the securities, long tenor and tight pricing relative to comparable benchmarks in the Mexican market," said Humberto Cabral, head of structured finance in Mexico at Accival. In 2002, Citigroup/Banamex led the way for the company's first issuance of bonds, targeted at retail investors.

"This is an important step in Citigroup's goal to link microfinance institutions such as Compartamos with the domestic, local currency capital markets," said Bob Annibale, Director of Citigroup's Office of Microfinance. "By raising funds from local investors, Compartamos can expand a self-sustaining business proposition that helps thousands of entrepreneurs - many of whom are women - to build small local businesses, which in turn strengthen communities and local economies."

Compartamos is a financial institution that provides micro loans, with an average size of US$300, primarily to women in rural areas in Mexico. The company has a increasing network of 94 branches in 22 states of Mexico and has more than 250,000 borrowers. The loans provide working capital for Compartamos clients to build small businesses, and the firm has become a role model in microfinance for its strong financial performance and highly successful lending methodology.

Carlos Danel, Co-CEO of Compartamos noted: " This is a milestone transaction for Compartamos as it opens the way for a broader and deeper investor base for future growth of the company. We are excited that institutional investors in Mexico are willing to invest in microfinance and therefore continue to build a stronger and more inclusive financial sector in the country". Carlos Labarthe, the company's co-CEO added: " We believe it's also a milestone for the microfinance industry in the world as well. Not only is investing in microfinance good business, but it's also a way of creating enormous social wealth in our communities."

About Citigroup

Over the last several years, Citigroup has collaborated on microfinance projects with some 145 microfinance partners in more than 50 countries and is working with microfinance leaders to support the emergence of uniform standards and to increase efficiency and transparency.

Our Global Corporate & Investment Banking Group is a leading force in the world's capital markets and consists of three business lines: Global Banking, Capital Markets, and Transaction Services. We provide more industry-leading solutions to more clients in more countries than any of our competitors. No other company serving the capital markets offers Citigroup's geographic reach, local presence, product scope, expertise, and high standards.

Citigroup (NYSE: C), the preeminent global financial services company which has 200 million customer accounts and does business in more than 100 countries, provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, insurance, securities brokerage, and asset management. Major brand names under Citigroup's trademark red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney, Banamex, and Travelers Life and Annuity. Additional information may be found at www.citigroup.com

About Grupo Financiero Banamex 

Grupo Financiero Banamex is member of Citigroup, Inc., and is the leading financial group in Mexico. Through its affiliates, that include Banco Nacional de Mexico ("Banamex"), the Group keeps a preeminent position in the financial markets of the country, including deposits, consumer financing, management of mutual fund societies and funds for retirement, insurance banking, pensions and money brokerage. The group has an extensive distribution network of more than 1,400 branches and 4,400 ATMs located throughout the country. For more information, please visit www.banamex.com.

About Compartamos

Compartamos is a regulated financial institution by Mexican law committed to provide financial services for the low-income population of Mexico. By providing services to its clients, Compartamos aims at creating opportunities through innovative, massive and efficient models that create economic and social wealth in the country. Compartamos has assets for more than MXN 1,100 (about $100million) and serves more than 250,000 thousand borrowers. Compartamos is rated by S&P with a stand-alone rating of A+ (local rating) and a Fitch stand-alone rating of A+ (local rating) as well. Compartamos is a member of the prestigious Accion International Network based in Boston MA. and the Microfinance Network, based in Washington D.C. Additional information may be found at www.compartamos.com