Citigroup (C) Wraps Up India Consumer Banking Sale to Axis Bank
Citigroup Inc. C announced the completion of the sale of its India consumer business to Axis Bank Limited. The sale was announced in March 2022. The sale includes retail banking, credit cards, wealth management and consumer loans, as well as the transfer of around 3,200 Citi employees.
The transaction is anticipated to result in a regulatory capital release of $1.4 billion. When the deal was announced, it was expected that Axis Bank would pay Citigroup $1.6 billion to acquire the consumer business, subject to customary closing adjustments.
Notably, the wall street biggie will continue operating its institutional businesses in India.
Peter Babej, Citigroup Asia Pacific CEO, remarked, "India remains a critical institutional market for Citi. In line with our broader strategic repositioning, we will continue to support our institutional clients in this core market and across APAC, delivering the full power of our global network to enable their growth."
Citigroup CEO of Legacy Franchises, Titi Cole, noted, “Completing this landmark sale in India is a key milestone for Citi as we execute on our firm’s strategy refresh. We sincerely thank our former colleagues and clients for their contributions and loyalty and wish them continued success.”
Since the announcement of the broader strategic actions to exit consumer banking across 14 markets in Asia, Europe, the Middle East and Mexico, Citigroup has signed deals to divest consumer businesses in nine markets and completed sales in seven markets, including Australia, Bahrain, Malaysia, the Philippines, Thailand, Vietnam and India.
The company is also in the process of winding down its consumer business in China and Korea, while in Russia, it is wrapping up all its business.
Such exits will free up capital and help the company pursue investments in wealth management operations in Singapore, Hong Kong, the UAE and London to stoke growth. These efforts will likely help augment the company’s profitability and efficiency over the long term.
Over the past year, shares of Citigroup have lost 10.6% compared with a decline of 9.4% recorded by the industry.
Image Source: Zacks Investment Research
Currently, Citigroup carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Inorganic Expansion Efforts by Other Banks
Amid a challenging operating backdrop due to expectations of economic slowdown, banks are undertaking expansion moves through acquisitions. Recently, Bank of Montreal BMO announced the closure of its acquisition of Bank of the West from BNP Paribas BNPQY.
With this deal, BMO expands its presence across more than 500 additional branches and commercial and wealth offices in major U.S. growth markets. For BNPQY, the sale is part of its efforts to streamline operations and enhance operating efficiency.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Citigroup Inc. (C) : Free Stock Analysis Report
Bank Of Montreal (BMO) : Free Stock Analysis Report
BNP Paribas SA (BNPQY) : Free Stock Analysis Report
To read this article on Zacks.com click here.