16th April 2021 - 3 min read
Citigroup Inc (Citi) has announced that it will be exiting retail banking in 13 markets across two regions – Asia as well as Europe, the Middle East, and Africa (EMEA). This decision impacts its businesses in Malaysia, along with Australia, Bahrain, China, India, Indonesia, South Korea, the Philippines, Poland, Russia, Taiwan, Thailand and Vietnam.
Following this exit, the bank said that it will operate its consumer banking business in both regions from four wealth centres in Singapore, Hong Kong, the United Emirates, and London. Meanwhile, its institutional clients group in these affected markets – which includes the private bank, cash management arm, as well as investment banking and trading businesses – will continue to serve its customers.
In justifying this decision, the New York-based bank said that the move is part of an ongoing review of its strategy by new chief executive officer, Jane Fraser, who took over last month. “This positions us to capture the strong growth and attractive returns the wealth-management business offers through these important hubs,” Fraser said in a statement.
Fraser also stated that although the 13 markets have excellent businesses, Citi does not have the scale that is needed to compete. “We believe our capital, investment dollars, and other resources are better deployed against higher returning opportunities in wealth management and our institutional businesses in Asia,” she added.
Chief executive officer of Citi Malaysia, Usman Ahmed also echoed a similar opinion, but reassured Malaysian customers that this decision will not dilute the group’s long-term commitment to the country or the Asia Pacific region. “There is no immediate change to our operations and no immediate impact to our colleagues as a result of today’s announcement by Citi to pursue an exit from our consumer bank business in Malaysia. We will continue to serve our consumer banking customers with the same dedication as we do today,” Usman clarified.
Usman also added that the Citi Solutions Centres in Kuala Lumpur and Penang both remain important operations hubs for Citi, from where it conducts financial transactions worth over US$29 trillion annually for over 50 countries.
For context, Citi has a history of more than 60 years in Malaysia, with 10 branches currently available nationwide. The group also banks 85% of the top 20 largest market cap companies within the country, with over 650 multinational corporates. Last year, Citi raised over US$7.5 billion for its Malaysian clients.
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