Citigroup Agrees to Sell 41 Texas Branches to BB&TDakin Campbell and Elizabeth Dexheimer
Citigroup Inc., the fourth-largest U.S. bank by deposits, agreed to sell 41 retail branches in Texas to BB&T Corp. as the lender pares its consumer-banking business.
The locations include those in Dallas, Houston, Midland and Odessa, New York-based Citigroup said today in a statement. BB&T will pay a 5.3 percent premium to book value on about $2.3 billion in deposits, according to a separate statement from the Winston-Salem, North Carolina-based lender. The sale is expected to be completed in the first quarter of 2015 and isn’t material to earnings, Citigroup said.
“Our branch footprint in Texas did not provide the scale to capture future growth and market share in traditional retail banking,” Andrew Brent, a Citigroup spokesman, said in the statement. “We see the retail banking industry rapidly evolving beyond a purely branch-based model, and so we will dedicate our resources and investments on a more focused branch footprint in our major urban markets and on expanding our digital channels nationally.”
Citigroup is exiting some retail-banking markets as Chief Executive Officer Michael Corbat narrows the firm’s focus to businesses with higher growth potential. The bank agreed last year to sell 21 branches in Texas to BB&T, and has gotten out of retail banking in countries including Spain, Greece and Honduras.
BB&T, run by CEO Kelly King, pushed into Texas by acquiring Colonial Bank, which failed in 2009. BB&T opened offices in the state last year before adding Citigroup’s locations.
“We could not be more pleased to welcome our new Texas clients and associates into the BB&T family,” King said in his firm’s statement. “Our previous 21-branch acquisition from Citibank has already proven to be a cultural fit.”
BB&T is a “top 20 bank” in Texas, King said on a July 21 earnings conference call. King has said he wants to be in the top five.