Citibank’s retail assets good bet for local contenders to bolster existing affluent customer base, says CLSA
- ByAyushi Ray | September 8, 2021
Citibank’s retail assets good bet for local contenders to bolster existing affluent customer base, says CLSA. oN 16th April it was said that they would exit customers belonging to 13 countries across Asia and Europe. The 13 nations include Australia, Bahrain, China, India, Indonesia, Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand, and Vietnam. The shortlisted contenders for Citi’s Indian assets include Kotak, HDFC Bank, Axis, and DBS Bank. According to the CLSA report, for Kotak Bank, the business adds 20 per cent to its current retail book and increases its card segment by three times. “It is also complementary to its affluent customer base and Kotak Bank’s premium valuation will aid it in purchase,” the report said.
Citibank runs a profitable franchise in India and had a loan book of Rs 68,800 crores as on March, 2021, of which Rs 28000 crore was retail loans. These mainly included cards, mortgages and personal mortgages, said CLSA. Citibank is the sixth largest card issuer with market share of 4.2 per cent in cards issued. CLSA estimates Citibank could have a credit card book of approximately Rs 9000 crore. Apart from retail assets, Citibank India’s Citi Suvidha (salary accounts) and Citi gold (affluent/wealth customers) offer a strong liability proposition as well, the report said. According to CLSA, for HDFC Bank, Citibank’s retail book size is not a game changer constituting only six per cent of the retail loans. “But it is still a good asset,” said the report.
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