Citi Bank on Wednesday joined the list of foreign banks that have exited India’s retail banking business as the US banking giant announced the sale of its consumer banking portfolio to Axis Bank for an estimated $12,325 crores of rupees.
Major global banks such as ANZ Grindlays, RBS, Commonwealth Bank of Australia have reduced their operations in India.
In a mega-deal announcement on Wednesday, Axis Bank and Citibank said their boards had approved the acquisition of Citibank’s consumer business in India by Axis Bank.
As part of the deal, US-based Citi will sell Citibank India’s consumer banking business, which includes credit cards, retail banking, wealth management and consumer lending.
Scaling Citi’s operations in India is part of its strategy to exit retail operations in 13 markets to conserve capital and focus on higher yielding revenue streams. It entered India in 1902 and launched the mainstream banking industry in 1985.
Earlier in 2012, the major British bank Barclays massively reduced its operations in India by closing a third of its branches located in non-metropolitan areas. The reduction of its operations in India was part of the UK-based bank’s strategy to move away from retail banking to focus more on vertical markets of corporate banking, investment banking and wealth management.
In 2016, Commonwealth Bank of Australia quit operations in India, saying the decision was made after careful assessment of its operations in India alongside its refocused strategy.
In the same year, Royal Bank of Scotland Plc (RBS) also decided to end its corporate, retail and institutional banking activities in the Indian market, as it wanted to reduce its global footprint.
Australia and New Zealand Bank had ended its domestic operations in 2000 after selling its Grindlays Bank unit to Standard Chartered for $1.34 billion. However, it reentered the Indian market in 2011 by opening a new branch in Mumbai. ANZ had been in India since 1984 through its presence as Grindlays Bank.
In 2011, Deutsche Bank sold its credit card business to IndusInd Bank. In 2013, UBS exited its India operations while Morgan Stanley relinquished its banking license while continuing its investment banking business.
Similarly, Merrill Lynch, Barclays and Standard Chartered reduced their operations in 2015.
Among others, HSBC closed two dozen branches and reduced its presence in 14 cities in 2016 and BNP Paribas closed its wealth management business in India in 2020.
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