Citigroup has closed the previously announced sale of its Vietnam retail banking and consumer credit card businesses to Singapore-based commercial banking company United Overseas Bank (UOB).
The US lender said that the divestiture that involved the transfer of around 575 related employees to UOB Vietnam is expected to deliver a ‘modest regulatory capital benefit’.
Citi’s Vietnam consumer banking unit includes its unsecured and secured lending portfolios, wealth management and retail deposit businesses.
The transaction was initially announced in January last year, as part of Citi’s broader plan to exit consumer banking across 14 markets in Asia, Europe, the Middle East, and Mexico.
Citi has already signed agreements in nine markets and completed divestments in six markets, including Australia, Bahrain, Malaysia, the Philippines, and Thailand, before Vietnam.
Citi Asia Pacific CEO Peter Babej said: “Citi remains deeply committed to Vietnam, and we will invest further to support institutional clients locally and across our global network.
Citi Legacy Franchises CEO Titi Cole said: “The completed sale of our consumer business in Vietnam puts us one step closer to delivering on our divestiture mandate as part of the firm’s strategy refresh.”
UOB has already closed the acquisition of Citi’s operations in Thailand and Malaysia in 2022, with the Indonesian consumer banking business planned for this year-end.
The acquisitions in the four markets, Thailand, Malaysia, Indonesia, and Vietnam, are expected to strengthen UOB’s franchise in ASEAN.
Upon closing, the acquisitions are expected to double the bank’s existing retail customer base in the four markets and add 5,000 people to its team strength.
UOB Vietnam and Citigroup Vietnam are working closely to ensure an easy transition for customers. The transition is expected to take 12 to 18 months.
The companies are planning for a full system integration, which provides their consumer banking customers with continued product offerings, services, and benefits.
In a separate development, Indian lender Axis Bank announced the closing of a deal to acquire Citigroup’s local consumer and non-banking finance businesses.
