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UPDATE 1-Raiffeisen buys Citi's Romanian retail portfolio
March 21, 2013 / 9:17 AM / 4 years ago

UPDATE 1-Raiffeisen buys Citi's Romanian retail portfolio

(Adds detail on Romania and CEE banks, price estimate)

By Georgina Prodhan and Sam Cage

VIENNA/BUCHAREST, March 21 (Reuters) - Austria’s Raiffeisen Bank International has agreed to buy Citibank’s retail portfolio in Romania, which has more than 90 million euros ($117 million) in assets, it said on Thursday.

The deal - worth less than 100 million euros according to a source familiar with the situation - is the first such acquisition since Raiffeisen bought Polbank, the Polish arm of Greece’s EFG Eurobank Ergasias, last year.

But it could herald other disposals in the region by western banks.

Local media have reported some western lenders are looking to sell assets in central and eastern Europe as part of efforts to raise funds to shore up their balance sheets.

Because of the euro zone debt crisis and the need to shore up capital at home, the mostly western-owned banks that came to dominate the European Union’s emerging wing have been withdrawing funds from the region since 2008.

But the pace slowed in the third quarter of 2012 from the second due to better financial conditions, according to a survey in January.

Figures from the Vienna Initiative group of multilateral lenders showed bank withdrawals from the continent’s central and eastern region were equivalent to 0.5 percent of its economic output in that time.

Large Austrian banks like Raiffeisen have, however, said they would remain in the region. Raiffeisen, which did not put a value on the deal, said the business it had taken over included more than 100,000 clients.

Raiffeisen vies with Erste Group Bank for second place in the CEE region behind market leader UniCredit Bank Austria

$1 = 0.7722 euros Editing by David Goodman and David Holmes

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