Citigroup closing on deal to sell its retail banking operations

Citi is looking to sell its Australian retail banking operations.

Citigroup expects to agree on the sale of its Australian retail banking operations within the next three months.

Dataroom understands the process is well under way after a separation of various shared functions was largely completed. The three-month time frame would see the Australian market leading the way in the global bank’s strategy to rationalise its geographic footprint in consumer banking.

Citigroup in April said it was pursuing an exit from consumer banking businesses in 13 markets, including Australia, following a strategic review.

Locally, Citi has indicated its preference to sell the businesses in a single transaction, rather than go through the cumbersome process of splitting credit cards from consumer banking.

Interested parties are likely to include Macquarie Group and ANZ, which missed out on buying ME Bank to Brisbane-based Bank of Queensland. The other major banks and Bendigo and Adelaide Bank are also expected to run a rule over the Citigroup retail portfolio.

A sale would, however, be subject to Australian Prudential Regulation Authority approval.

The latest APRA data as at April 30 shows Citigroup is the fifth largest player in the credit card market with a portfolio of almost $3.55bn, shy of National Australia Bank’s $3.92bn.

Citigroup has about $4.2bn in owner-occupied mortgages and $2.5bn in housing investment loans, with total loans and finance leases printing at $11.61bn.

Citigroup’s Australian team – led by chief executive Marc Luet – have said the sale of the consumer business will see it concentrate on its investment banking unit. That includes capital markets, mergers and acquisitions advisory, markets and securities services, commercial banking and treasury and trade finance.