Itau in Talks to Buy Citigroup's Brazil Consumer-Banking Arm
September 22 2016 - 6:29AM
Dow Jones News
By Rogerio Jelmayer
SÃO PAULO -- Brazilian banking giant Itau Unibanco Holding SA
said it is in talks to acquire Citigroup Inc.'s consumer-banking
operations in Brazil.
However, Itau said it hasn't signed any contract regarding the
acquisition, and it didn't provided further information. Itau's
statement came after local media reported that Itau and Citi were
in exclusive talks regarding a deal.
Citigroup in February said it was planning to sell its consumer
operations in Brazil, Argentina and Colombia.
Earlier this year, the head of Banco Santander Brasil, the
Brazilian unit of Spain's Banco Santander SA, said the Spanish bank
was interested in Citi's operation in Brazil.
Citi has long struggled to compete in Brazil, even during the
economic and lending boom that preceded the current recession,
because of high costs associated with operating in the South
American country and what insiders have called a weak strategy for
dealing with the country's compliance quirks.
Brazil's banking industry is highly concentrated among five
banks: Itau; Banco Bradesco SA; Santander; and government-owned
giants Banco do Brasil SA and Caixa Economica Federal. Together
they control almost 70% of the assets in the Brazilian financial
system.
Citi's business in Brazil has just 1% of the financial system's
assets, according to central-bank figures.
Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com
(END) Dow Jones Newswires
September 22, 2016 07:14 ET (11:14 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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