Citi to Sell Philippines Consumer Bank to UnionBank of the Philippines

The US banking giant Citi today announced that it has reached an agreement to sell its consumer banking franchise in the Philippines to UnionBank of the Philippines. Subject to the timing of regulatory approvals, completion is expected in the second half of 2022.

"This transaction represents a positive outcome for our clients, our colleagues and our firm. We are delivering on our renewed strategy, focusing resources in areas where our global network positions us to deliver optimal growth and returns,"Peter Babej, Citi Asia Pacific CEO, said.”Citi will continue to serve institutional clients in the Philippines and across Asia Pacific as we have for over a century.”

The sale involves Citi's local credit card, unsecured lending, deposit and investment businesses, as well as Citicorp Financial Services and Insurance Brokerage Philippines Inc. (CFSI), which provides insurance and investment products and services to retail customers.

In adiition, the agreement covers all related Citi staff, with approximately 1,750 consumer bank and supporting employees expected to transfer to UnionBank upon close of the transaction.

As announced earlier this year, Citi will exit its consumer franchises in 13 markets, including Australia, Bahrain, China, India, Indonesia, South Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand and Vietnam, which is expected to release approximately $7 billion of allocated tangible common equity over time.

The latest sale is expected to release approximately $300 million of allocated tangible common equity, as well as an increase to tangible common equity of approximately $500 million. The bank mentioned that it will use the capital generated to invest in their strategic priorities.

On the other hand, the bank has expanded its cross-currency sweeps cash management solution​ to other 14 European countries this month, including Bulgaria, Hungary, Czechia, Slovakia, Netherlands, Ireland, Germany, Sweden, Norway, Belgium, France, Spain, Portugal, and Austria.