It’s business as usual for Citi PH, retail banking clients assured

It’s business as usual for retail banking clients of Citi, the foreign bank has assured, as the global bank’s announced exit from this business segment is not something that will happen overnight.

“We would like to convey to all credit card, bank account holders and our customers in investments and loans, that all our existing products and services will continue normally and there will be no change in our high level of service,” Citi Philippines consumer business head Manoj Varma said in a statement.

“All branches, ATMs (automated teller machines), call centers and offices, will continue to operate as they do today. Customers can continue to conduct transactions or service inquiries through the Citi Mobile App, Citibank Online and Citiphone. This will remain the case until we notify customers of any changes,” Varma added.

It was recently announced that Citi, one of the oldest foreign banks in the Philippines, is bowing out of the local consumer and retail banking business as part of a global downsizing program. This means that Citi will give up its local credit card business, alongside retail deposit-taking, asset management and lending to individuals and households.

Citi plans to exit its consumer franchises in 13 jurisdictions, namely: Australia, Bahrain, China, India, Indonesia, Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand and Vietnam. It will keep the institutional businesses in these markets.

But Citi is likely to unwind its operations in any or all of these markets once it is able to sell the businesses to other institutions.

“Everyone will be interested [to buy] as it is a fast way to grow. It’s just a matter of pricing,” said an investment banker affiliated with one of the country’s largest local banks.

“There is no immediate change to our operations, and no immediate impact to our colleagues as a result of this announcement. We will continue to serve our clients with the same dedication and focus on service excellence as we do today,” said Citi Philippines CEO Aftab Ahmed.

Ahmed became Citi’s country chief in the Philippines in 2015, moving from his previous post as country head in Hungary in the same year that Citi signed a deal to sell its consumer business there to Erste Bank Hungary Zrt. and its subsidiary Erste Befektetési Zrt. (Erste Investment).

Citi divested its retail banking, consumer loans, cards businesses and transferred consumer banking employees in Hungary and henceforth focused on serving institutions, including Hungarian corporations, financial institutions, public sector clients and multi-national clients with operations in Hungary.

In the Philippines, Citi has a rich and long history dating back to 1902. Reaffirming its commitment to this market despite the planned sale of the consumer business, the new strategy is seen to present an opportunity to “invest further and grow” Citi’s institutional clients group franchise in the country, which provides clients access to market-leading corporate and investment banking, capital markets and advisory, treasury and trade and markets and securities services solutions.

Citi currently serves 90 percent of the top 20 largest market-cap firms and over 950 multinational companies in the Philippines. In the last year, it helped raise over $20 billion in corporate funding for Philippine clients.

The bank gave assurance that its Philippine unit remained profitable and well capitalized, with capital ratios exceeding required regulatory requirements.

As of end-2020, Citi was the 12th largest universal bank in the country with P331.32 billion in total assets. It had a P153.75-billion loan book and P215 billion in deposit base. There is data available how big the consumer business is relative to its institutional business.