Citigroup Said to Seek Sale of 50 Texas Branches in Rural Areas
Citigroup Inc. (C), the third-biggest U.S. bank by assets, may sell half its Texas branches as Chief Executive Officer Michael Corbat refocuses on the biggest urban areas, three people with direct knowledge of the matter said.
The approximately 50 branches holding $2 billion in customer deposits could fetch as much as $50 million, said two of the people, who asked for anonymity because the sale is confidential. Most of the outlets are in rural areas in western Texas, one person said.
Corbat, 53, is looking to cut costs by $900 million this year and focus on what Citigroup calls the world’s top 150 cities. He’s shutting branches across the U.S. and selling retail units in countries including Uruguay and Turkey.
“We just want to be focused in certain urban centers and that includes the U.S.,” Chief Financial Officer John Gerspach said in December. “You’re not going to see us opening up branches in Montana or Tennessee or places like that.”
Andrew Brent, a spokesman for New York-based Citigroup, said the company declined to comment.
The bank has branches in Texas towns including Odessa, Abilene and San Angelo, as well as seven outlets in the state capital of Austin, according to data from the Federal Deposit Insurance Corp.
Citigroup’s North American consumer-banking unit had 983 branches at the end of June, according to a financial supplement. The bank had 2,929 branches across Latin America, Asia, Europe, the Middle East and Africa, and lists total consumer bank deposits of $326.6 billion. San Francisco-based Wells Fargo & Co. (WFC) has the most branches of any U.S. bank with about 6,185 as of March 31.
Bank of America Corp. and HSBC Holdings Plc also have been getting rid of U.S. branches to save money as more customers bank online.