The U.S. third-largest bank, Citigroup Inc (NYSE:C), could ink a deal with Commercial International Bank (CIB) for its consumer business in Egypt if all goes well. CIB, the largest listed lender in Egypt’s stock market, has gained access Citigroup’s books to conduct due diligence. However, there is no assurance that a deal will be inked between the two companies.
Citigroup Inc (NYSE:C) is shrinking its retail operations abroad. The bank announced plans to divest its consumers operations it at least 11 countries worldwide. Among the largest banks in the U.S., Citigroup has the largest globally focused operation. Although Citigroup is exiting retail operations in some markets, the company intends to expand in segments that are most profitable. As such, the company isn’t divesting operations focused on institutional clients.
Bids for Egyptian retail portfolio
Egypt is one of the countries that Citigroup has decided to sell its retail business. The bank has about nine branches in Cairo and Alexandria through which it serves over 100,000 individual accounts. Besides CIB, Citigroup also received bids for its Egyptian operations from potential buyers such as Mashreqbank PSC and Emirates NBD PSJC, based in Dubai.
Citigroup Inc (NYSE:C) is also seeking buyers for its Latin America retail businesses that are spread across five countries in the region, in a deal that could generate $1.5 billion. Additionally, the bank recently disclosed plans to cede its remaining 9.9% stake in Turkey’s second largest lender known as Akbank TAS. The deal could bring in $1.15 billion.
Slimming down is expected to enable Citigroup to operate more efficiently given that the bank has struggled to achieve stability since the financial crisis.
Possible dividend hike
According to analysts, there is a strong possibility that Citigroup Inc (NYSE:C) could hike its dividend this year. The bank failed the so-called stress test in 2014 and was unable to bolster dividend payout. However, this year, the bank could reward shareholders with dividend of up to $0.07 a share, significantly above $0.01 that it has been paying.