In a major acquisition within the Indian banking sector, Axis Bank has acquired Citibank’s shopper companies for Rs 12,325 crore.
The transaction includes the sale of the buyer companies of Citibank India, which incorporates bank cards, deposits and loans companies in retail banking, wealth administration and shopper loans. The deal additionally contains the sale of Citicorp Finance (India) Ltd, comprising the asset-backed financing enterprise, which incorporates business automobile and building tools loans in addition to the non-public loans portfolio.
Axis Bank will purchase 3 million prospects of Citibank India to boost the previous’s presence in the important thing recognized development segments. Its playing cards stability sheet will develop by 57 per cent, with an extra 2.5 million Citibank playing cards, making it one of many high 3 playing cards companies within the nation.
The deal will add Rs 1,10,900-crore belongings below administration from Citi Wealth & Private Banking merchandise to enhance and reinforce Axis’ Burgundy model, making it the third largest by mixed AUM within the wealth administration area. The deal will contain addition of mixture deposits of Rs 50,200 crore, of which 81 per cent is CASA (present and financial savings account). Further, the deal will embody over 1,600 Suvidha company relationships with greater than 1 million prospects and a median wage of Rs 70,000 per thirty days.
Axis Bank mentioned it is going to acquire entry to 7 workplaces, 21 branches and 499 ATMs of Citibank throughout 18 cities. It can even soak up round 3,600 in-scope shopper workers of Citibank.
“Axis Bank looks at this acquisition as a healthy strategic fit,” it mentioned. It will acquire entry to the big and prosperous buyer franchise of Citibank having a bouquet of fee-oriented and worthwhile segments, which embody high quality bank card portfolio, prosperous wealth administration clientele, significant deposits with 81 per cent being CASA, together with a powerful shopper lending portfolio. After the acquisition, Axis Bank can have 28.5 million financial savings accounts, 2.3 lakh Burgundy prospects and 10.6 million playing cards. “The bank has made large investments in people, processes and technology over the past few years. With the required capabilities in place, it expects successful integration across all key parameters including employees, customers, product offerings and technology in a value accretive manner,” the financial institution mentioned.
According to Axis Bank, the acquired portfolio would improve Axis Bank’s bank card buyer base by 31 per cent with an extra 2.5 million playing cards, which is able to, in flip, bolster the playing cards stability sheet place to be among the many high 3 gamers within the Indian market. Moreover, the wealth and personal banking portfolio will add nice worth to the Axis Burgundy enterprise, additional accelerating its development ambitions in that section.
“Axis Bank and Citibank together will ensure continuity of superior customer service levels, even post-closing of transaction, across all customer channels. Citibank’s customers will continue to avail all the rewards, privileges, and offers to which they were previously entitled,” it mentioned.
In April 2021, Citigroup introduced its exit from the buyer banking within the nation (together with 12 different nations) as a part of a worldwide technique to concentrate on institutional enterprise. The financial institution had then mentioned that it’s going to proceed with its wealth administration and institutional enterprise in India. The financial institution had indicated that there gained’t be any layoffs or closure of workplaces in India.
