Citigroup is almost ready to make a deal to sell Banamex in Mexico
Citigroup is almost ready to...
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Citigroup is almost ready to make a deal to sell Banamex in Mexico

13 February 2023
2 min.
Citigroup is almost ready to make a deal to sell Banamex in Mexico

Citi Mexico unit to be sold

Citigroup is close to completing a deal to sell its Mexico unit. The Financial Times reported this on Monday, specifying that the deal could be worth between $6bn and $8bn.

According to the newspaper, billionaire Germán Larrea, who owns Mexico's largest mining company Grupo Mexico, is in talks to buy retail bank Banamex, owned by Citigroup. However, as the newspaper notes, there are still no guarantees that the parties will reach an agreement.

Citigroup, for its part, noted that the corporation is "engaged in an active dialogue" and is "satisfied with the progress" and "remains committed to pursuing a path that maximises value" for its shareholders.

The decision to sell the assets is part of the US corporation's updated strategy to exit the retail banking markets, which will see Citigroup leave Mexico and 13 other countries in Asia and Europe. It was previously reported that the company is also winding down its retail banking business in China.

Two knowledgeable people said Grupo México and Citi had discussed keeping the US bank's stake in Banamex until it could later sell it in an initial public offering. Bloomberg first reported on such a possibility.

Citi bought Banamex in 2001, when it was Mexico's second-largest bank with a long prestigious history. But in the two decades since then Banamex has fallen to fourth place, with insiders blaming poor transaction decisions and stricter US regulations.

Banamex was put up for sale in January 2022, after Citi initially said it could keep the bank.

The decision to exit but retain the institutional banking business is part of chief executive Jane Fraser's wide-ranging departure from international retail banking, which will see Citi leave Mexico and 13 other markets in Asia and Europe.

According to two people, despite preliminary private talks with rivals Santander and Banorte, Citi has decided to hold a public sale. Both banks declined to comment.

As for Citi's latest earnings report for January, one analyst said investors were already expecting an announcement about the sale of Banamex.

Wells Fargo analyst Mike Mayo said a possible sale price of $6 billion to $8 billion would not excite investors, but quick regulatory approval of any deal was valuable.

Persons2 and Companies4 in the news

Chief Executive Officer of Grupo México
1 place
Chief executive officer of Citigroup
2 place
Wells Fargo
3 place
4 place
Source foto:
Rating companies
14 Mention
14 Mention
Walt Disney Company
12 Mention
11 Mention
JP Morgan Chase
10 Mention
10 Mention
Ford Motor Company
10 Mention


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