Citigroup has decided to close its domestic retail banking business 17 years after it acquired Hanmi Bank in 2004 and launched it as Citibank Korea. Customers, financial industries and authorities who have used Citibank Korea have entered into a complicated calculation of the impact of this incident. As of the end of last year, Citibank Korea's customer loan assets amounted to 24.7 trillion won and individual customers' deposits amounted to 27.3 trillion won.
Customers who have used financial products such as loans, deposits, and cards at Citibank 폰테크 Korea are worried that they will not be affected by the difficulty of extending loans or the suspension of financial products. According to Citibank Korea on October 18, inquiries from customers increased by 25% after news of withdrawal was announced on the 15th.
Financial authorities and Citibank Korea explained that there will be no risk to existing customers no matter how retail banking exit strategy is set. “If the business is to be sold, it will be transferred to the comprehensive transfer capital, and even if the company withdraws step by step, it will not be difficult for the customer to feel the difficulty because if the existing deposits and loan customers remain, they will have to maintain their operations until the end,” said a Financial Services Commission official.
Citibank Korea said, “Until the specific plan is confirmed, customer service will be maintained the same as the current one.” “We will provide detailed information to customers if there are changes or other necessary measures in the future service.”
However, some predict that the strengths of existing Citibanks, such as credit loan limits and asset management (WM), which were more relaxed than ordinary commercial banks, will not continue. This competitiveness is based on high-quality investment information provided by Citigroup headquarters and differentiated management strategies of overseas financial companies, so the nature of the product will change after taking off Citibank signboards.
While Citigroup has not disclosed specific plans related to exit strategies, the M&A market is also showing signs of shaking. WM, credit card, etc. are being separated and sold separately, the retail banking sector is sold entirely, or the business is gradually reduced and the domestic market is being withdrawn.
Citibank Korea has been competitive in the WM field with its high-value asset-oriented selection and concentration strategy, which is a key point of the financial sector. In particular, in the case of local financial holding companies, it is possible to naturally enter the national market through the acquisition of Citibank, which can be an opportunity to grow. Some observers say that the buyer may not come forward unexpectedly. “There is also a skepticism about whether it will be beneficial to acquire the property that was decided to withdraw due to a downward trend in performance,” said a bank official.
There is also concern that Citibank's symbolism and influence, which has been playing a role as a financial networking service for the US, could be reduced simply by leaving market share. In fact, during the 2008 financial crisis, the Korea-US currency swap was signed, and it was reported that Ha Young-gu, the head of Citibank Korea, played a major role. This is why Citibank is making a joke about the USFK in the financial sector.“Citibank has been a bridge between the U.S. financial community and policy authorities to raise dollars when there are national difficulties, such as the financial crisis,” said a financial source.