SAO PAULO Citigroup Inc (C.N) is conducting a strategic review of its consumer banking business in Uruguay, following media reports that the New York-based lender might be nearing the sale of its retail banking unit in the country.
Citigroup is reviewing its operations in the country to "maximize efficiencies," it said in a statement on Thursday. The company, which has been in Uruguay for more than 97 years, said the country remained "a market with multiple opportunities for Citi and will continue to be so."
Under Chief Executive Officer Michael Corbat's plans to reposition Citigroup, the bank is exiting some markets where it cannot reach the scale necessary to generate adequate return on invested capital. This plan is expected to help Citigroup save more than $1.1 billion annually beginning next year.
According to Uruguayan newspaper El Observador, Itaú Unibanco Holding SA (ITUB4.SA), Brazil's largest bank by market value, is close to placing a binding offer for Citigroup's retail banking division in Uruguay. With the purchase, Itaú would become Uruguay's second-largest bank after Banco Santander SA (SAN.MC) of Spain, the newspaper said, citing unnamed sources familiar with the situation.
The report did not disclose terms of the offer, including its size.
A spokeswoman for Itaú in São Paulo declined to comment on market speculation.
Both lenders are trying to close the deal "as soon as possible," Observador noted, adding that the transaction would involve the transfer of assets and liabilities from Citigroup's retail banking unit in the South American country as well as 62 employees belonging to that division.
(Reporting by Guillermo Parra-Bernal; Editing by Nick Zieminski and Lisa Von Ahn)