Raiffeisenbank, the Czech subsidiary of Raiffeisen Bank International, has agreed to purchase Citibank’s retail banking and card businesses in the Czech Republic.
The latest sale is in line with Citi’s strategy of divesting non-core operating businesses and assets, and streamlining operations to 24 markets with highest growth potential.
Upon completion of the deal, Citi’s consumer banking employees, branches and ATMs in the Czech Republic will be transferred to Raiffeisenbank.
Citi, however, plans to focus on expanding the services it offers to Czech corporations, banks and public sector clients and also continue to service its multi-national clients with operations in Czech and global investors.
Subject to customary and regulatory approval, the transaction is expected to be completed by the first quarter of 2016. Both companies did not disclose any details about the value of the transaction.
Raiffeisen Bank International CEO Karl Sevelda said: "The acquisition of Citibank’s retail portfolio by Raiffeisenbank is fully in line with RBI’s new strategic measures which we announced at the beginning of February.
"Although for the time being, our aim is to reduce our risk-weighted assets, we want to grow in selected markets which are in a strong position to generate sustainable returns.
"The Czech market is one of those, as it offers a stable economic and legal framework, there’s still catch-up and growth potential in the banking market, and our expectations regarding profitability and risk are positive."
As of the end of the first half of 2015, Raiffeisen operated with 125 business outlets in the Czech Republic and has approximately 2,700 employees.