This Wednesday, Citi announced the direct sale process of Banamex, its commercial subsidiary in Mexico and will share its business in the public sector through public offers of sale (OPI).
For more than a year, the financial institution has been working on the separation of consumer banking, small businesses and medium-sized banking operations, which are represented in Mexico by the Banamex brand. To achieve this goal, Citi has so far completed a two-fold process with the investigation of a direct purchase offer and preparation in parallel for a possible initial public offering on the Stock Market.
In recent months, the Banamex group has evaluated the purchase of companies such as Banco Santander, Grupo Mifel and Grupo México. However, the deal proposals were not satisfactory enough for Citi to decide to sell Banamex to one of these two business units. Banamex has a value between 7000 and 10,000 million
In a press release, Jane Fraser, CEO of Citi, stated that “with careful consideration, we have concluded that there is a better way to increase the value of Banamex for our partners, and to simplify our goal of promoting our move from our dual track approach to placing a single IPO business. Citizens in Mexico for more than a century have worked, and in this global crisis we will continue to position and grow our institutional industry franchise center, bringing the full power of Citi’s global network to our institutional and private banking clients in this premier market.
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Banamex’s listing on the stock market is going to come in 2025, so it is an important time in which today’s pronouncement can be reconsidered.
Citizens know that Banamex will retain its brand in the series of the Mexican Stock Exchange and will continue to offer a portfolio of financial services for both small and medium-sized businesses through a distribution network made up of almost 1,300 branches, some 9,000. ATMs, around 12.7 million retail banking customers, nearly 6,600 commercial banking customers and 10 million pension fund customers.
This means that, after the public exit, Banamex will keep the business of credit, retail loans, used loans, mortgage loans, insurance, life annuities, pension insurance management, deposits and fixed income trading.
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In addition, Citi confirmed that approximately 38,000 employees, who currently work in business units such as the Banamex art collection and buildings, will continue to belong to the entity that is to be sold.
The sale of Banamex was announced early last year as part of Citi’s expansion strategy, currently focused on global wealth management businesses, as well as payments and loans and a special presence in the United States. Thus, Citi will continue to operate in Mexico through the institutional client business and Citi Private Bank for high net clients.
