Axis Bank is all set to acquire Citigroup’s retail
banking business in India. The deal, expected to be valued at $2.5 billion (Rs
18,000 crore), is likely to be announced soon, according to PTI.

With the acquisition of Citibank’s India retail business,
the balance sheet of Axis Bank will expand and it will get a larger footprint
across India. According to RBI data, Axis Bank has an outstanding credit card base
of 8.6 million and Citibank has 2.6 million credit cardholders.  

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Axis Bank did not respond to an email seeking comments on
the proposed transaction, reported PTI.

Earlier this month, Axis Bank stated it hadn’t decided on
purchasing Citigroup’s India retail business.

Axis Bank, Kotak Mahindra Bank and IndusInd Bank were in
the race and had submitted binding bids to acquire Citibank’s consumer banking
portfolio.

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The banking business includes retail banking, home loans,
credit cards and wealth management. Citibank has 35 branches in the country and
around 4,000 employees in the consumer banking business.

Overall, Citibank’s India business has a 0.6% market
share of advances and a 1.1% share of deposits. As of March 31, 2021, Citi had
loans worth Rs 68,747 crore in India and deposits of Rs 1.66 trillion. It has
more than 2.5 million retail customers and 1.2 million bank accounts. The India
business contributes 1.5% in profit to the bank’s global book.

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Citigroup has been operating in India since 1902 and
started the consumer banking business in 1985. It was among the first banks to
introduce Indians to credit cards in 1987.

In April 2021, Citigroup announced its plan to exit the
consumer banking business in India as part of a global strategy that focuses on
four wealth centres in Singapore, Hong Kong, the United Arab Emirates and
London. Citigroup had said the decision would allow it to direct investments
and resources to areas where it has the most scale and growth potential.

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Apart from India, the bank decided to exit retail
business in Australia, Bahrain, China, South Korea, Poland, Indonesia, the
Philippines, Malaysia, Russia, Taiwan, Thailand and Vietnam.

In addition to institutional banking in India, Citigroup
will continue to focus on offshoring or global business support through its
centres in Mumbai, Pune, Bengaluru, Chennai and Gurugram.