However, it remains committed to Romania in terms of institutional business, says James Cowles, chief executive officer of Citi for Europe, Middle East and Africa (EMEA).
“We looked at our business five or six years ago, we redefined our strategy (…) and we spent the last five or six years streamlining our businesses, so we went from a balance sheet that pre-crisis was at $3 trillion and today is at $1.9 trillion – that’s a lot of restructuring,” James Cowles, the second most powerful member of Citi’s worldwide top management, told ZF in an interview.
“We sold a lot of businesses, some of which are very good businesses, but did not fit strategically, we sold a lot of assets. We have a balance sheet that’s $1.9 trillion dollars, that’s relatively large, but it’s also finite. We have discipline now in terms of what we do with the resources that we have. (…) We’re going to allocate those resources to those countries (…) where we have something of value to offer to our clients.”
The Citi official visited five countries in the region last week, and met with employees, corporate customers, representatives of central banks and authorities in Romania, Czech Republic, Slovakia, Hungary and Bulgaria.
Citi is among the top three most profitable banks in Romania. The local subsidiary of the US group posted a record net profit of 280 million lei (EUR62 million) last year, an increase of more than 40% on 2013. Whereas it sold the retail business in this country, it remains “committed to Romania in terms of the institutional business.”
Commenting on the strategy of the last few years, James Cowles talked about the decision to reduce the number of countries where Citi has a retail presence, which translated into the sale of the retail businesses in 12 countries, including Romania. Those were very good and profitable businesses, with a good client and employee reputation, he said.
Citi, one of the world’s most important financial institutions with a tradition of more than 200 years and some 200 million clients in more than 160 countries, has been operating in Romania for almost two decades. Two years ago, Citi decided to sell its retail business in this country to Raiffeisen, which got EUR80 million loans, EUR136 million deposits and more than 80,000 clients. The size of the portfolio made this deal a first time for the local market.
The sale of Citi’s retail businesses is in progress in several other countries.
“We get very good interest from other banks in terms of buying it (the consumer business in various countries i.e.). We also sell it with the employees, which I think is very important.”
What Citi looked at on the retail or consumer side of the business is what are those countries where it truly thinks it has something competitive to offer, where the businesses have the size and the scope where Citi can have economies of scale and where it can be productive. So in the EMEA region, Citi will keep its retail units in Poland, Russia, the UAE, Bahrain and the United Kingdom.
Citi’s institutional business is operational in more than 100 countries worldwide and in 55 countries in the EMEA region. The globality if offers its customers is what Citi believes gives it a very distinct advantage versus other banks, James Cowles said.
(English version by Loredana Fratila-Cristescu)