Citi exits Indian retail banking operations New York-based Citibank will sell its Indian retail banking business to Axis Bank for £1.24 billion. (Photo by Mario Tama/Getty Images)
CITIBANK has joined the list of foreign banks that have exited their retail banking business in India.
The US-based lender announced the sale of its consumer banking portfolio to Axis Bank for an estimated Rs 123.25 billion (£1.24 bn).
Global banking majors such as ANZ Grindlays, RBS, Commonwealth Bank of Australia have scaled down their operations in India.
Under a mega-deal announcement on Wednesday (30), Citi will sell the consumer banking businesses of Citibank India, which include credit cards, retail banking, wealth management and consumer loans, to Axis Bank.
Citi’s scaling down of operations in India is part of its strategy to exit retail businesses in 13 markets to conserve capital and focus on higher-yielding revenue streams. It had entered India in 1902 and started the consumer banking business in 1985.
In 2012, British banking major Barclays massively scaled down India operations by closing a third of its branches located in the non-metro areas. Shrinking its operations in India was part of the UK-based bank’s strategy to move away from retail banking to concentrate more on the corporate banking, investment banking and wealth management verticals.
In 2016, Commonwealth Bank of Australia exited India operations saying the decision was taken after a careful evaluation of its India operations alongside its refocussed strategy.
The same year, Royal Bank of Scotland Plc (RBS) too decided to wind up its corporate, retail, and institutional banking business in the Indian market as it wanted to reduce its global footprint.
Australia and New Zealand Bank had in 2000 wound up its Indian operations after selling its Grindlays Bank unit to Standard Chartered for $1.34 billion. However, it re-entered the Indian market in 2011 by opening a new branch in Mumbai. ANZ was in India since 1984 through its presence as Grindlays Bank.
In 2011, Deutsche Bank sold its credit card business to IndusInd Bank. In 2013, UBS exited India operations while Morgan Stanley surrendered its banking licence while continuing its investment banking business.
Likewise, Merril Lynch, Barclays and Standard Chartered scaled down their operations in 2015.