Citigroup announced on Monday that it has completed the separation of retail bank Banamex from its institutional banking business in Mexico as it prepares to list Banamex on the stock exchange.
“With this separation complete, effective December 1, Citi will now operate two separate financial groups in Mexico: Grupo Financiero Citi México and Grupo Financiero Banamex,” the New York-based bank and financial services company said in a statement.
“The separation into these financial groups marks a significant step in the execution of its strategic plan to simplify the firm,” the company added.
Citigroup purchased Banamex – one of Mexico’s largest banks – in 2001.
It announced in May 2023 that it would seek to sell Banamex on the stock exchange, ending conjecture that a US $7 billion sale to the conglomerate Grupo México was imminent.
On Monday, Citigroup said that it “continues to actively work on the proposed IPO of Grupo Financiero Banamex.”
The timing of the listing, it added, “will be driven by regulatory approvals and market conditions to maximize shareholder value, which remains a priority for Citi.”
Reuters has reported that Citigroup has considered a dual stock listing for Banamex, possibly in Mexico City and New York.
Commitment to Mexico ‘as strong as ever,’ says CEO
Citigroup CEO Jane Fraser said Monday that the separation of Banamex from Citi México “represents an important milestone in our simplification and brings us closer to our long-term vision of a more connected bank that is focused around our core strengths.”
“We are proud to have executed this process thoughtfully and with full transparency. Our commitment to our clients in Mexico is as strong as ever, and we will continue to connect Mexico and the world through our market-leading investor and corporate client platforms,” she said.
“We will now prepare for the Banamex IPO, focused on optimizing value for our shareholders.”
According to the Citigroup statement, Citi México will maintain “a significant presence” in Mexico and continue to serve Citi’s institutional clients here through “a full-service bank,” Citi Banco México, and through the brokerage Citi México Casa de Bolsa.
Approximately 3,000 Citi México employees will serve around 2,000 institutional clients, including “financial institutions, governments, investors, multinationals, and national companies seeking to internationalize,” according to Citigroup.
For its part, Banamex will continue to operate as a full-service bank, “offering retail banking, including wealth management services, consumer loans, residential mortgage lending, deposits, payroll services, payments and a full suite of commercial banking products,” Citigroup said.
“… With its digital-first mentality, innovative online banking and mobile apps and an extensive network of approximately 1,300 branches and more than 9,100 ATMs across the country, Banamex will continue to offer a full range of financial services to nearly 20 million clients, furthering its 140-year legacy in Mexico,” the company said.
“Over 39,000 employees currently supporting these businesses, as well as Banamex’s art collection and historical buildings, and the social and cultural associations (Fomentos), will continue to be part of the Banamex financial group,” Citigroup added.
Banamex had revenue of more than US $4.7 billion in the first nine months of 2024, the Wall Street Journal reported last week.
“Banamex accounted for about 8% of Citi’s total revenue in the first nine months of 2024,” the newspaper said.
With reports from Reuters
