Citi to sell $97 mln S.Korea consumer assets-paper

SEOUL, May 22 (Reuters) - Citigroup (C.N) has put some of its South Korean consumer finance unit's holdings up for sale, in line with the U.S. bank's plan to shed non-core assets, a local newspaper reported on Thursday, citing unnamed industry sources.

Citigroup declined to confirm the report, saying that it was developing its local consumer finance business.

The largest U.S. bank, hit hard by flagging mortgage and the credit market crunch, has said it plans to shed $400 billion non-core assets within three years.

The Financial News daily said that Citigroup Capital Korea Inc. had picked a lead manager to initially sell 100 billion won ($96.50 million) of loan assets by June in an undisclosed auction, according to its Web site (www.finnews.com).

"It is known that they are selling (assets of) the consumer finance business in tranches," an unnamed official at a financial services company was quoted as saying.

Citibank Korea spokesman Lee Yong-shik said: "Citigroup Capital has been continuing to expand its South Korean business and opened six new branches so far this year."

The asset sale has drawn interest from units of domestic financial holding companies and conglomerates, including Hyundai Motor (005380.KS) Group, Shinhan Financial Group (055550.KS), Woori Finance Holdings (053000.KS) and Hana Financial Group (086790.KS), the paper added.

Since late last year, Citigroup has recorded more than $45 billion of writedowns and credit losses and raised more than $40 billion of new capital.

Citigroup Capital Korea, with about 600 staff and 87 branches, posted a 43.3 billion won net profit last year. ($1=1036.2 Won)

(Reporting by Kim Yeon-hee; Editing by Keiron Henderson)