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Citi completes sale of Indonesia consumer business to UOB


Citi has completed the sale and migration of its Indonesia consumer businesses to UOB Indonesia (UOBI). The sale includes retail banking, credit card, and unsecured lending businesses, as well as the transfer of an unspecified number of employees. It doesn’t include Citi’s institutional business in the country. 

A Citi spokesperson declined to give the number of employees moving with the business when asked by FinanceAsia but said “we have large remaining businesses across our institutional businesses”. Citi Indonesia posted a net income of IDR1.7 trillion ($110 million) in Q3 2023, a 46% increase from the previous year, primarily driven by higher net interest income across its banking, markets and services businesses.

Citi and UOB first announced the transaction in January 2022 as part of a broader sale agreement covering consumer banking across Malaysia, Thailand, Vietnam and Indonesia. Sales in Malaysia and Thailand were completed on November 1, 2022, and the sale in Vietnam was completed on March 1, 2023.

The transaction is expected to result in a “modest regulatory capital benefit” to Citi. In total, the sale of these four consumer businesses to UOB has resulted in a regulatory capital benefit of approximately $1.1 billion, according to a statement. 

The sale excludes the bank’s institutional businesses, and Citi remains focused on serving institutional clients in Indonesia locally, regionally and globally.

Since announcing its intention to exit consumer banking across 14 markets in Asia, Europe, the Middle East and Mexico as part of a change in strategy, Citi has now closed sales in nine of those markets including Australia, Bahrain, India, Malaysia, the Philippines, Taiwan, Thailand and Vietnam, in addition to Indonesia.

A statement from the bank added that previously announced wind-downs of Citi’s consumer businesses in China and Korea and overall presence in Russia are in progress. Citi also announced that it will pursue an IPO of its consumer, small business and middle market banking operations in Mexico, and that it has restarted the exit process for the consumer banking business in Poland.

Titi Cole, Citi’s head of legacy franchises, said in a media statement: “Completing our final divestiture of a full consumer franchise in Asia marks a significant milestone in simplifying the firm. This is a testament to the commitment of our employees across these markets and a clear demonstration of Citi’s ability to execute on our strategy. We are sincerely grateful to our former employees in Indonesia and wish them the very best in their careers with UOB.”

Earlier this year in August Citi completed the sale of its consumer business in Taiwan to DBS for around $1.2 billion.

Global restructure

Meanwhile Citi has announced the first of several changes to its global organisational structure.

Several large news media organisations, including Bloomberg, reported that 300 senior manager roles have been cut at the bank, which is understood to be around 10% of the workforce at that level, in unspecified locations. 

When approached by FA, a Citi spokesperson cited a November 20 statement, that said: “Today we shared with our colleagues the next layer of changes across many of our businesses and functions as we continue to align Citi’s organisational structure with our new, simplified operating model.” 

The statement didn’t specific the number of cuts involved. 

The statement added: “As we’ve acknowledged, the actions we’re taking to reorganise the firm involve some difficult, consequential decisions, but we believe they are the right steps to align our structure with our strategy and ensure we consistently deliver excellence to our clients.”

 


¬ Haymarket Media Limited. All rights reserved.





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