Citigroup on Thursday put most of its consumer businesses in Asia and eastern Europe up for sale and said it would focus on wealth management in those regions, as it reported sliding revenues in its lending business.
“As a result of the ongoing refresh of our strategy, we have decided that we are going to double down on wealth,” said Jane Fraser, who became chief executive in February. “While the other 13 markets have excellent businesses, we don’t have the scale we need to compete.”
Citigroup said it would look to sell its consumer businesses in Australia, Bahrain, China, India, Indonesia, Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand and Vietnam.
The move is the second sweeping change for Citi’s consumer bank this year. In January, the bank said it would move wealth management into its global consumer business, pulling it out from its institutional clients group.
The exits will not affect the bank’s institutional clients business in those countries, the bank said.
Its remaining consumer and wealth management businesses will be run out of four hubs: Singapore, Hong Kong, the United Arab Emirates and London.
Citi, the third-largest US lender by assets, also reported a 7 per cent slide in revenue in the first quarter, primarily due to low interest rates and tepid loan demand, which offset robust growth in investment banking fees.
Its loan book shrunk 8 per cent during the quarter, and revenue in North American branded credit cards, once the primary driver of growth for its global consumer bank, logged a third straight quarter of double-digit declines.
Still, first-quarter profit more than tripled compared to last year as an improving economy and lower loan volume allowed it to release $3.8bn of its reserves for potential bad loans. To date, the bank has released more than half of the $10.5bn it set aside for loan losses in the early days of the pandemic last year.
Overall Citigroup reported net income of $7.9bn, or $3.62 per share, up from $2.5bn, or $1.06 per share a year earlier.