Citi Shutting Consumer and Commercial Units in Russia
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After failing to find buyers, Citi has decided to close its consumer and commercial banking businesses in Russia.
Citi will shut down its Russian consumer and commercial banking businesses starting this quarter, it said in a statement Thursday. The closure will result in about $170 million in charges over the next 18 months and affect 2,300 out of 3,000 employees across 15 branches in the country. Deposit accounts, investments, loans and cards will also be affected.
The decision follows failed attempts to find a buyer for either business amid an ongoing Russia-Ukraine conflict.
We have explored multiple strategic options to sell these businesses over the past several months, said Titi Cole, Citi’s chief executive of legacy franchises. It’s clear that the wind-down path makes the most sense given the many complicating factors in the environment.
The bank’s Russian exposure totaled $8.4 billion as of the end of the second quarter, down from $9.8 billion compared to end-2021, with around $1 billion linked to the consumer and commercial banking businesses, it said.
Questions & Answers
Q.Why has Citi decided to close its consumer and commercial banking units in Russia?
Why has Citi decided to close its consumer and commercial banking units in Russia?
Citi decided to close these businesses after failing to find buyers. This decision follows multiple strategic options being explored to sell them amid the ongoing Russia-Ukraine conflict and many complicating factors in the environment.
Q.What financial impact will the closure of these businesses have on Citi?
What financial impact will the closure of these businesses have on Citi?
The closure is expected to result in approximately $170 million in charges for Citi over the next 18 months. This figure relates specifically to the winding down of its consumer and commercial banking operations.
Q.How many employees will be affected by Citi's withdrawal from the Russian consumer and commercial banking market?
How many employees will be affected by Citi's withdrawal from the Russian consumer and commercial banking market?
Around 2,300 employees out of a total of 3,000 across Citi's 15 branches in Russia will be affected by the closure. Deposit accounts, investments, loans, and cards will also be impacted.
Q.What was Citi's total financial exposure in Russia, and how much was linked to the units being closed?
What was Citi's total financial exposure in Russia, and how much was linked to the units being closed?
Citi's total Russian exposure was $8.4 billion by the end of the second quarter, reduced from $9.8 billion at the end of 2021. Approximately $1 billion of this was specifically linked to the consumer and commercial banking businesses being shut down.
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