Citi is in advanced talks with the Taipei-based lender and is working out the terms of the potential disposal of assets that could be valued at nearly $1.5bn, the sources said.
They are aiming to reach an agreement in the coming weeks, the sources added.
Through the deal, Fubon is looking to bolster its operations in mainland China, where it operates through subsidiaries.
In 2014, Fubon acquired an 80% stake in Shanghai-based First Sino Bank and later renamed it to Fubon Bank (China).
In 2016, Fubon Bank (China) became a wholly-owned subsidiary of Fubon Financial Holdings, which is Taiwan’s leading financial holding firm by assets.
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Deliberations are on and a decision is yet to be made, the sources said adding that, Citi could also hold talks with other bidders if the talks with Fubon do not proceed.
The divestiture is part of Citi’s ongoing strategic overhaul that will see the lender exiting 13 retail banking markets in the Asia Pacific and EMEA.
It is instead planning to shift its focus to more profitable businesses such as investment banking.
Recently, Citi agreed to sell its consumer banking operations in Indonesia, Malaysia, Thailand, and Vietnam to Singapore’s United Overseas Bank.
The announcement followed Citi’s $908m deal to offload its Filipino retail banking operations to UnionBank.