Citigroup to Wind Down Russian Consumer, Local Commercial Operations
August 25 2022 - 8:45AM
Dow Jones News
By Will Feuer
Citigroup Inc. said it would wind down its Russian consumer bank
and local commercial banking operations in Russia, confirming an
earlier report in The Wall Street Journal.
The New York bank said the wind-down is expected to affect about
2,300 employees and 15 branches. Citi said it expects to incur
about $170 million in costs, primarily over the next 18 months,
largely driven by restructuring, vendor termination fees and other
charges.
The company had said it would exit Russian consumer banking in
April 2021, part of a broad pullback from international consumer
operations in 14 markets across Asia, Europe, Middle East and
Africa, and Mexico.
The bank had been in discussions to sell operations in Russia to
Russia's VTB. U.S. and European authorities have since sanctioned
VTB to weaken Russia financially and undermine Moscow's war in
Ukraine.
Citigroup executives had still hoped to sell the bank, which has
branches in 10 cities throughout the country. In May, Chief
Executive Jane Fraser said the bank was in active dialogue about
selling the unit. But in July, she said, "we are considering the
full range of possibilities to exit our consumer and commercial
banking businesses, including portfolio sales."
Citigroup opened the retail bank in 2002 to serve wealthier
citizens. It serves some 500,000 clients in Russia.
Citi's core business is serving multinational companies around
the globe and is more exposed in Russia than other big U.S. banks.
It has been cutting that exposure rapidly this year. In July, it
said its worst case for losses on all the exposure was about $2
billion.
Write to Will Feuer at Will.Feuer@wsj.com
(END) Dow Jones Newswires
August 25, 2022 08:30 ET (12:30 GMT)
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