HONG KONG (BLOOMBERG) – DBS Group Holdings, UOB and Standard Chartered Bank are among lenders considering bidding for Citigroup consumer banking assets in Asia as the US lender sells units in five markets in the region, according to reports. people familiar with the matter.
Firm bids for Citigroup’s retail assets in Indonesia, the Philippines, Taiwan and Thailand are expected Friday (October 22), while bids for the Indian unit are expected next week, the people said. , who asked not to be identified because the information is confidential. .
The sales offer buyers a chance to develop high-end credit cards and wealth management businesses – whose appeal to banks is primarily their high fees rather than interest income – in regions that no longer correspond to Citigroup’s renewed strategy.
Under the leadership of Jane Fraser, Managing Director, the bank is leaving 13 markets in Asia and Europe, the Middle East and Africa. Its Australian operations were sold to the National Australia Bank in August.
The sales in Asia come as the bank reorganizes its business around more profitable units like investment banking and focuses its wealth management activities around hubs in Hong Kong, London, Singapore and the United Arab Emirates. Citigroup plans to raise US $ 150 billion (S $ 201 billion) in new money and hire 2,300 people in Asia for wealth management by 2025.
In investment banking this year, Citigroup is the highest-ranked foreign company in the rankings for early public offerings for Asia excluding Japan, and fifth for transactions, according to data compiled by Bloomberg.
Deliberations are ongoing and potential suitors may decide not to proceed with the offers, the people said. A Citigroup spokesperson in Asia said that “conversations with potential buyers continue with keen interest from a wide range of bidders.”
Singapore’s DBS plans to submit binding offers for Indonesia and Taiwan, the people said. CEO Piyush Gupta said in August that the bank’s capital levels were high enough to buy more assets without raising additional funds, and expressed interest in several Asian markets. A representative for DBS declined to comment.
Beyond the assessment, Citigroup will assess the proposals in each market based on other issues such as antitrust, job protection and strategy, one of the people said.
Citigroup’s consumer assets in Taiwan could fetch around US $ 2 billion from a sale, the sources say. DBS, StanChart, Cathay Financial Holding and Fubon Financial Holding are expected to file offers, the people said.
The company could even raise nearly $ 4 billion, depending on the assets included, one of the sources said.
The Taiwanese government will monitor and prevent Citigroup from transferring high net worth clients from Taiwan to its units in Hong Kong and Singapore, the island’s financial regulator said in April.
Representatives for StanChart and Fubon declined to comment. Cathay did not immediately respond to phone calls and emails seeking comment.
Bangkok Bank plans to make an offer for Citigroup’s Thai assets, which could be valued at more than $ 2 billion, the sources said.
Bank of Ayudhya, owned by Japanese lender Mitsubishi UFJ Financial Group, is also considering an offer, they said.
A representative from Bangkok Bank declined to comment, while Bank of Ayudhya did not immediately respond to an email seeking comment.
Citigroup has set an offer deadline next week for its Indian consumer assets, which could be valued at around $ 2 billion at a sale, people said.
The Kotak Mahindra Bank, which is controlled by the world’s richest banker Mr. Uday Kotak, is considering making an offer for the assets, the people said. HDFC Bank and ICICI Bank are also evaluating offers, they said.
Representatives for Kotak Mahindra and HDFC declined to comment. ICICI did not respond to emails seeking comment.
Indonesia and Philippines
DBS is considering making an offer for Indonesia, while Singaporean rival UOB is considering making an offer, the people said. UOB CEO Wee Ee Cheong said in May that the bank would review the assets.
Malayan Banking is also considering a bid for the Citigroup unit, the sale of which could value the company up to $ 1 billion, the sources said.
A Maybank representative declined to comment. The UOB did not immediately respond to requests for comment.
BDO Unibank, Metropolitan Bank & Trust, Bank of the Philippine Islands and Union Bank of the Philippines are exploring offers for Citigroup’s Philippine assets, which could fetch up to US $ 1 billion on sale, they said. .
Union Bank chairman Edwin Bautista said in response to a question from Bloomberg News that the assets will likely go to one of the country’s three big banks, and declined to comment further. Representatives from BPI and Metrobank declined to comment, while a representative from BDO Unibank was unable to comment immediately.