Itau Unibanco Holding SA, Latin America’s largest bank by market value, agreed to buy Citigroup Inc’s retail banking business in Brazil for 710 million reals (US$220 million), taking over operations that the US company has maintained in the country for more than 100 years.
The purchase includes Citi’s 71 branches in the South American country as well as its deposits, insurance brokerage, credit cards and loan portfolio, Sao Paulo-based Itau said in a regulatory filing on Saturday.
Citi has about 35 billion reals in deposits and assets under management in Brazil, according to the document.
The acquisition reinforces Itau’s presence in the wealth segment, which accounts for the majority of Citi’s customers in Brazil, Itau’s investor relations officer Marcelo Kopel said in a separate e-mail on Saturday.
Citigroup chief executive officer Michael Corbat has been shrinking the company’s retail footprint to simplify the firm, cut costs and boost returns.
The bank announced plans to exit Brazil and Argentina in February, and in October 2014 said that it would drop consumer banking in 11 markets, including Peru, Costa Rica and four others in Latin America.
Speaking to reporters in Washington, Brazilian Minister of Finance Henrique Meirelles said that Citi is not exiting Brazil; only its money-losing retail operations.
The company is not selling its wholesale business, which includes investment banking.
“I was with the president of Citi yesterday and he assured me that Brazil is indeed a priority and that for areas in which Citi is strong globally, including Brazil, it will continue investing ever more,” Meirelles said. “It’s a strategy to focus on its operations that are strongest.”
The sale to Itau needs to be approved by Brazil’s central bank and the nation’s antitrust agency, known as Cade.
Regulators probably would give the acquisition an extra layer of scrutiny because the local market is already highly concentrated, Cade member Cristiane Alkmin Junqueira Schmidt said on June 8.
Citigroup, which gets more revenue from outside its home market than any of its US competitors, maintains a consumer banking presence in 19 countries.
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
PLANS: MSI is also planning to upgrade its service center in the Netherlands Micro-Star International Co (MSI, 微星) yesterday said it plans to set up a server assembly line at its Poland service center this year at the earliest. The computer and peripherals manufacturer expects that the new server assembly line would shorten transportation times in shipments to European countries, a company spokesperson told the Taipei Times by telephone. MSI manufactures motherboards, graphics cards, notebook computers, servers, optical storage devices and communication devices. The company operates plants in Taiwan and China, and runs a global network of service centers. The company is also considering upgrading its service center in the Netherlands into a
RSS