Yahoo Finance Citigroup (C) Announces Discontinuation of Haiti Operations
Citigroup Inc. C will discontinue its operations in Haiti, marking the end of the company's more than five-decade presence in the country. This move will be immaterial to Citi and its international clients in economic terms.
Citi will seek approval from Banque de la République d’Haiti (BRH) — Haiti’s central bank — to voluntarily surrender its banking license. However, international banking and correspondent banking services will remain accessible to existing clients.
This move stemmed from a strategic business review based on client segmentation and market conditions and was partially due to subdued international activity and reduced demand from institutional clients in Haiti.
Citi has been present in Haiti for more than 50 years, playing a key role in assisting companies, institutions, individuals and communities in the country to fulfill their financial goals. Additionally, it has promoted investments and other activities that have contributed to the country’s growth. Citi has aided NGOs offering critical services to the country during times of crisis.
Citi remains focused on Latin America and has a strong presence in the market, where it has operated for over a century and developed an unparalleled network to serve its clients.
This strategic move aligns with Citi’s emphasis on growth in core businesses via streamlining operations globally. In June 2024, Citigroup completed the sale and migration of its onshore China-based consumer wealth portfolio to HSBC Bank China, a wholly owned subsidiary of HSBC Holdings plc HSBC. Furthermore, the bank is gradually winding down its consumer banking operations in Korea and its overall presence in Russia.
Citi is also planning to exit the consumer, small business, and middle-market banking operations in Mexico — Banco Nacional de México (“Banamex”) — which is expected to be completed by the second half of 2024.
Several finance firms are actively involved in restructuring efforts to focus on core business. Last month, HSBC restructured its operations in Germany to focus more on its growth strategy in Asia. The bank has put its Germany-based fund administration unit INKA and custody business up for sale, attracting interest from several major financial institutions.
HSBC's strategic focus on Asia reflects impressive growth in the region. By leveraging synergies across retail wealth, asset management, insurance, private banking and fintech, the company plans to position itself to meet comprehensive wealth management needs in Asia.
Likewise, last week, Barclays PLC BCS announced the divestiture of its Germany-based consumer finance business, Consumer Bank Europe, to BAWAG P.S.K., a subsidiary of BAWAG Group AG. This strategic move aligns with the company’s plan to streamline its operations as outlined in the Investor Update on Feb 20, 2024.
The sale, which will be completed for a small premium to net assets, is expected to release nearly €4.0 billion of risk-weighted assets. This transaction will bolster BCS’ Common Equity Tier 1 ratio by about 10 basis points, enhancing its capital strength. The completion of the transaction is anticipated within six to nine months, subject to regulatory and court approvals.
Over the past year, Citi shares have risen 27.8% compared with the industry’s growth of 16.7%.
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Currently, C carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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