DBS completes acquisition of Citi’s consumer banking business in Taiwan
Singapore banking giant DBS has completed the acquisition and migration of Citi’s consumer banking business in Taiwan, making it the largest foreign bank in Taiwan by assets.
DBS completes acquisition of Citi’s consumer banking business
The acquisition more than doubles DBS Taiwan’s consumer banking customers to over 1.1 million, and more than triples its investment assets under management to over $8.85 billion (SGD 12 billion), giving DBS “clear market leadership” among foreign players when it comes to loans, deposits, cards and investments.
The sale was first announced in January 2022, with DBS then agreeing to pay Citi in cash for the net assets of its consumer banking business, along with a premium of $705 million (SGD 956 million). Citi says the transaction is expected to result in a regulatory capital benefit of approximately $1.2 billion.
With the completion of the deal, DBS has also absorbed close to 3,000 employees from Citi Consumer Taiwan.
Commenting on the acquisition, Piyush Gupta, CEO of DBS, says: “By bringing a prized Citi franchise into our fold, we accelerate our consumer business growth in Taiwan by at least 10 years. Overnight, revenue from the market will more than double to over $960 million (SGD 1.3 billion).
“With the transaction, I am also confident that we will be able to provide more value to our customers, in particular, helping them grow their wealth through innovative products, and helping those who are business owners expand into new markets or participate in regional trade flows.”
Change in strategy for Citi
The sale forms part of Citi’s wider intention to exit the consumer banking business across 14 markets in Asia, Europe, the Middle East and Mexico, as part of what it calls a “strategic refresh”.
In addition to Taiwan, Citi has signed sale agreements in eight other markets including Australia, Bahrain, India, Malaysia, the Philippines, Thailand and Vietnam, with plans to complete the sale of its Indonesia consumer banking business later this year.
As an update, Citi says the wind-down of its consumer banking units in China and South Korea, as well as its overall presence in Russia, are “in progress”. For Mexico, it plans to pursue an IPO of its consumer, small business and middle market banking operations, and also intends to restart the exit process for the consumer banking business in Poland later in 2023, subject to market conditions.
On the deal with DBS in Taiwan, Titi Cole, CEO of Citi legacy franchises, says: “We have made significant progress in executing Citi’s strategy, and completing this transaction is another important step forward in simplifying the firm.”
