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May 9, 2022

Citi’s Polish arm defers retail business divestment citing global turmoil

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Citi Handlowy, the Polish subsidiary of Citigroup, has postponed the sale of its retail business due to the current geopolitical tensions, Reuters reported.

Citigroup CEO Jane Fraser, who was on a visit to Poland last month, confirmed that the local unit was up for sale, Citi Handlowy CEO Elzbieta Czetwertynska said.

“However due to the current geopolitical situation and its economic impact, the bank has decided to postpone the transaction,” Czetwertynska said adding that “Citi will come back to the issue when the time is right.”

The news comes as the war between Russia and Ukraine drags on and the US-led alliance targets Moscow with sanctions.

The divesture is part of Citi’s global restructuring efforts to focus on the investment banking business.  

As part of the plan, Citi will exit 13 retail banking markets across Europe and Asia, including Poland.

Later, the bank announced plans to sell its Mexican retail business as well.

Citi is yet to find potential buyers in Poland, Mexico, Russia, and China.

In March this year, media reports said that the US bank is running out of options for its Russian retail arm.

“We are running out of options . . . shutting down everything might be our only option,” a Citi insider was quoted by the Financial Times as saying.

However, last week, Fraser revealed in a Bloomberg Television interview that the bank is in “active dialog” with interested parties for its retail and commercial banking business in Russia.

“We are selling our consumer and our commercial banking franchise on the ground there, and we are in active dialog around that,” Citi chief was quoted by Bloomberg as saying.

Fraser added: “We looked at China and Russia and Poland that we are working on actively, and then Mexico was just announced recently and we are already in the market. We are on a multiyear journey, and we are getting on with it.”

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