Commercial International Bank Egypt SAE has agreed to buy Citibank Egypt’s retail unit as the U.S. bank withdraws from less profitable emerging-market businesses.
About 900 full-time consumer banking and contract employees, eight Citi branches and the ATM network in Egypt will transfer to CIB, Citigroup Inc. said in an e-mailed statement on Tuesday. CIB will pay in cash and expects central bank approval in three to four weeks, Chairman and Managing Director Hisham Ezz Al Arab said in a phone interview today. He declined to comment further on terms.
“We haven’t looked at an acquisition since Bank of Alexandria,” Ezz Al Arab said, referring to the privatization of the fourth biggest government-owned bank in 2007. “Citi introduced the consumer lending concept in Egypt; that was the key interest for us.”
Citigroup is exiting consumer banking in 11 countries to focus on markets where it has the greatest scale and growth potential. It received bids for the Egyptian business from Dubai-based Emirates NBD PJSC and Mashreqbank PSC earlier this year, four people with knowledge of the matter said in January.
The lender’s consumer, securities and banking businesses serve more than 100,000 individual accounts and companies from nine branches in Cairo and Alexandria, according to information on its website.
The deal will add 80,000 credit cards to CIB, or a 33 percent increase, Ezz Al-Arab said. The Cairo-based bank’s personal loans portfolio will add 10 percent, he said.
Citi shares were little changed as of 10:38 a.m. in New York, having gained 12 percent over the last year, compared with 9.2 percent for the S&P 500 Banking Index.