Axis Bank’s Proposed Acquisition of Citibank’s Consumer Business in India Positions it Strongly for Accelerated Premium Market Share Growth | Odisha News | Latest news from Odisha
Mumbai: Axis Bank and Citibank today announced that their respective boards have approved the acquisition of Citibank’s consumer business in India by Axis Bank. The acquisition is subject to customary closing conditions, including receipt of regulatory approvals.
The transaction includes the sale of Citibank India’s consumer business, which includes credit cards, retail banking, wealth management and consumer lending. The deal also includes the sale of the consumer business of Citi’s non-banking finance company, Citicorp Finance (India) Limited, including the asset-backed finance business, which includes commercial vehicle and equipment lending. construction, as well as the personal loan portfolio.
Axis Bank views this acquisition as a sound strategic fit. It will have access to Citibank’s large and affluent customer franchise having a bouquet of paying and profitable segments, which include a quality credit card portfolio, affluent wealth management customer base, significant deposits with 81% being CASA, as well as a strong consumer credit portfolio. After the acquisition, Axis Bank will have approximately 28.5 million savings accounts, 2.3 million Burgundy customers and 10.6 million cards.
The Bank has made significant investments in people, processes and technology over the past few years. With all the required capabilities in place, she expects a successful integration of all key metrics, including employees, customers, product offerings and technology, in an accretive manner. Additionally, the deal provides strategic benefits to the Bank, such as premiumization of its global client portfolio, increased opportunities to cross-sell its products, and accelerated digital transformation.
The acquired wallet would increase Axis Bank’s credit card customer base by approximately 31% with an additional 2.5 million cards, which would strengthen the cards balance sheet position to be among the top 3 players in the Indian market. In addition, the wealth and private banking portfolio will bring strong added value to the activity of the Burgundy Axis, further accelerating its growth ambitions in this segment. Overall, the proposed transaction will add ~7% to the Bank’s deposit base (with an increase of approximately 12% in CASA) and an increase of approximately 4% in advances.
Axis Bank and Citibank will together ensure the continuity of superior customer service levels, even after the closing of the transaction, across all customer channels. Citibank customers will continue to enjoy all the rewards, privileges and offers to which they were previously entitled. In addition, Citibank customers will specifically benefit from Axis Bank’s broader geographic reach and comprehensive service offerings, as well as One Axis capabilities that extend across all of its subsidiaries. Digital banking and the highly rated Axis Mobile app offering over 250 services will be an added advantage for customers, having immediate access to view and transact across all product categories such as deposits, investments, payments and protective solutions. Additionally, world-class Citi Phone Banking will ensure service excellence for Citibank and Axis Bank customers.
Speaking on the occasion, Amitabh Chaudhry, MD&CEO, Axis Bank said: “We are delighted with the addition of an enviable retail franchise and high quality talent pool as we continue our journey. to become a leading financial services brand, in line with our GPS Strategy Framework. This is an important step in Axis’ growth and leadership journey and will bring great value to all stakeholders. The increased scale and breadth of offerings, diverse product portfolio and global best practices will enhance the customer experience, while greater synergies on both the revenue and cost side will increase the value of the new franchise.
We look forward to collaborating with Citi’s experienced leadership team and diverse talent pool as they join Axis’ more than 86,000 dedicated workforce. Axis Bank already has a rich network of Citi alumni across the hierarchy, reflecting the cultural alignment between the two organizations. Given the expertise that Citi employees bring to the table, we see them as an important addition to our existing team that will help drive synergies and our GPS goals. We welcome all employees to the Axis family and together we will serve our “Dil Se” customers.
Citi India CEO Ashu Khullar said, “We are extremely pleased with this outcome for our fellow consumers and our customers. Axis Bank is committed to growing its consumer banking business in India and is building on a strong market presence. We believe that Axis Bank will provide our employees with an excellent environment to build their careers and meet all the financial needs of our consumer customers. We remain committed to contributing to the growth and development of India as we deepen our presence through our institutional activities and community initiatives. Citi will also continue to tap into India’s rich talent pool in technology, operations, analytics, finance and related functional areas through its network of Citi Solution Centers located in five cities. in India and supporting our global business. »
A well-defined integration plan and a focused senior execution team will ensure a smooth transition and seamless integration on all fronts, in collaboration with Citibank. The team of specialists with expertise in operationalizing large-scale integration programs will focus on customer service, people, systems and technology and other synergies.
Axis Capital and Credit Suisse acted as financial advisors to Axis Bank on the transaction, and Khaitan & Co acted as legal advisor. In addition, the Bank was supported by PricewaterhouseCoopers and Boston Consulting Group.
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