Citibank stunned the financial market yesterday, as they announced their total exit from retail banking operations across 13 nations: India, Australia, Bahrain, China, India, Indonesia, Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand, and Vietnam
This also includes India, where they were present since 1902, and is right now the biggest foreign bank.
As per the bank, they will only focus on the biggest wealth management hubs in the world: Dubai, Singapore, London and Hong Kong, and scale down all other business operations.
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What’s The Future Of Citibank India?
As per statements issued by CitiBank, it’s clear that:
- No employee of their bank will be fired
- No customer will be impacted
- Entire retail banking operations will be now sold off.
This leads to the big question: Who will buy Citibank India now?
Citibank India: Few Vital Information
As of March, 2020, Citibank had 29 lakh retail banking customers, and employed 20,000 employees.
The bank has 12 lakh bank accounts and 22 lakh credit card users in India right now.
Citibank India is right now managing assets and deposits worth Rs 2.19 lakh crore. In December last year, 6% of all credit card spends in India was processed by Citi Bank.
With such a huge clientele, and impressive numbers, it would be really interesting to speculate who will be interested to acquire Citibank now?
Who Will Buy Citibank Now? 3 Strong Contenders
There are mainly three types of contenders, who can make the next move to acquire Citibank’s retail banking operations in India.
So, here we go:
Contender Type 1: Foreign Banks
As shared earlier, Citibank is India’s biggest foreign bank, and it’s highly likely that other foreign banks will be tempted to acquire Citibank India, and make their position stronger.
Primary among them is DBS Bank, based out of Singapore.
In November last year, DBS Bank acquired Laxmi Vilas Bank, and this can be a strong signal that they are open for more acquisitions, especially India’s biggest foreign bank.
Besides, there are more than 40 foreign banks that wish to enter India, and this can be an excellent opportunity for them.
Contender Type 2: Indian Banks
ICICI, HDFC and Axis Bank are the top private banks in India, and as per our speculations, Axis Bank will be very keen to acquire Citibank.
Mainly because this is the right time for them to make the move that can propel them to beat either HDFC Bank and ICICI Bank to become India’s #1 private bank.
As per Business Standard, ICICI Bank and Kotak Mahindra Bank too are strong contenders for acquiring Citibank’s Indian operations.
Contender Type 3: Payments Bank In India
Now, licensed payments banks are the real dark horses in this race to acquire Citibank India’s retail banking operations.
RBI had recently allowed payments banks and wallets like Google Pay, Paytm and PhonePe to offer RTGS and NEFT transfers. And most of the payments banks like Paytm have requested RBI to allow them to offer loans as well.
In case any of these payments banks are able to acquire Citibank, then it can turbocharge their position, and help them gain millions of new customers overnight.
Please note, that these are only speculations, based on market rumors and previous news and comments. There has been no confirmation from any of these financial institutions.
We will keep you updated as more details come in.
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