* A deal would help Itaú become Uruguay's No. 2 lender
* U.S. bank to exit places where returns, scale too small
* Citigroup says business opportunities in Uruguay remain
SAO PAULO, April 25 Citigroup Inc 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
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, 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 of Spain, the newspaper said, citing unnamed sources
familiar with the situation.
The report did not disclose terms of the offer, including
A spokeswoman for Itaú in São Paulo declined to comment on
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.