American banking giant Citigroup said on December 23 that it is selling its consumer banking business in the Philippines to UnionBank of the Philippines. The latter will pay cash for Citi Philippines’ net assets plus a premium of 45.3 billion pesos, for a total of 55 billion pesos ($1.1 billion). UnionBank’s largest shareholder is Aboitiz Equity Ventures of the Philippine billionaire family Aboitiz, which was designated as the preferred bidder for Citi Philippines earlier this month. This transaction includes Citi’s credit cards, personal loans, wealth management and retail deposits, Citi’s financial services, bank insurance…
American banking giant Citigroup said on December 23 that it is selling its consumer banking business in the Philippines to UnionBank of the Philippines.
The latter will pay cash for Citi Philippines’ net assets plus a premium of 45.3 billion pesos, for a total of 55 billion pesos ($1.1 billion).
UnionBank’s largest shareholder is Aboitiz Equity Ventures of the Philippine billionaire family Aboitiz. name Earlier this month, Citi Philippines was the preferred bidder.
The transaction includes Citi’s credit card, personal loans, wealth management and retail deposit business, Citi Financial Services, the bank’s insurance brokerage business in the Philippines, and its real estate assets, namely Citibank Plaza on Eastwood Avenue in Quezon City , Three full-service bank branches, five wealth centers and two self-service branches. It also covers all Citigroup related employees, of which approximately 1,750 employees are expected to be transferred to UnionBank.
Institutional banking in the Philippines is still operating
Peter Babej, Chief Executive Officer of Citi Asia Pacific, said that the bank will continue to provide services to institutional clients in the Philippines, providing a range of services to more than 950 multinational companies and leading local companies, including 90% of the top 20 companies based on Philippine Securities Calculation of the market value of the exchange.
UnionBank said the acquisition is to promote the growth of its retail banking industry. To fund the acquisition, the bank will use “internal resources” and raise up to 40 billion pesos in additional capital through equity issuance. The transaction with Citigroup is expected to be completed in the second half of 2022.
UnionBank stated that it will contact Citi customers in the next few months to learn more about the transaction and its impact on the banking business.
Withdraw from retail banking in 13 markets
Earlier this year, Citigroup announced that it would withdraw from its consumer business in 13 markets in Asia, Asia Pacific, Eastern Europe and the Middle East.
After Citigroup stated in August that it would sell its Australian consumer division to National Australia Bank and close its retail business in South Korea, the sale of Philippine assets is the third planned exit.
Citigroup also plans to withdraw from retail operations in Bahrain, China, India, Indonesia, Malaysia, Poland, Russia, Taiwan, Thailand and Vietnam because it does not have enough scale to compete with established banks in these markets. Citigroup CEO Jane Fraser Officer, said.
