Citi Sells Southeast Asia Consumer Banks to UOB in $3.7B Deal

Citi, Southeast Asia, Consumer Bank, United Overseas Bank

Citi has closed a $3.7 billion deal to sell its consumer banks in Indonesia, Malaysia, Thailand and Vietnam to Singapore’s United Overseas Bank (UOB), including retail banking and credit cards but excluding Citi’s institutional businesses, according to a Thursday (Jan. 13) press release.

Roughly 5,000 consumer bank and supporting employees are anticipated to transfer to UOB when the transaction closes, the release stated. The deal will give Citi $1.2 billion of allocated tangible common equity, as well as an increase to tangible common equity of over $200 million

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Citi announced earlier this year that it was selling off its consumer franchises in 13 markets across Asia Pacific (APAC) and Europe, the Middle East and Africa (EMEA). The sale is expected to give Citi about $7 billion of allocated tangible common equity over time, according to the release.

“We are confident that UOB, with its strong culture and broad regional ambitions, will provide excellent opportunities and a long-term home for our consumer banking colleagues in Indonesia, Malaysia, Thailand and Vietnam,” said Citi Asia Pacific CEO Peter Babej in the release. “Focusing our business through these actions will facilitate additional investment in our strategic focus areas, including our institutional network across Asia Pacific, driving optimal returns for Citi.”

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UOB was chosen by Citi to take over retail operations in the Southeast Asia region following a competitive auction, the release stated. During the transition to closing, Citi indicated that there will be no change in services to consumer banking and wealth customers.

The transactions are anticipated to close between the middle of this year and early 2024, contingent on how the regulatory approval process progresses, according to the release. Citi’s Banking, Capital Markets and Advisory Group is the financial advisor to Citi regarding the deal.

“The sale of these four consumer markets, along with our previously announced transactions, demonstrate our sense of urgency to execute our strategic refresh. We are committed to working in the best interests of our shareholders by focusing our resources on businesses that can deliver growth, as well as increasing the capital we return to shareholders over time,” said Citi Chief Financial Officer Mark Mason in the release.