Citigroup to sell Japan retail bank unit to SMBC

World Today

It said about 1,600 Citibank Japan employees in Japan will also be transferred to SMBC, one of three Japanese mega-banks.

The cost of the acquisition, which will close in late 2015, was not disclosed.

“This decision furthers Citi’s global strategy of focusing our resources where we feel we have a competitive advantage,” Citibank CEO Peter B. Eliot said in a statement.

Citigroup said it also is considering selling its credit card business in Japan, separately, as it streamlines its global banking and focuses on corporate and investment banking, and other services.

Citibank said its customers will be able to use Citi’s global banking networks after the deal is complete — a key concern for local customers.

Japan is a tough banking environment thanks to meager interest margins and heavy competition and most foreign banks have already closed up and gone home. Citi’s foreign currency deposits offer a way for SMBC to fund its expansion into overseas lending.

This story is compiled with information from The Associated Press.