Axis Bank on Wednesday said it has completed the acquisition of the Indian consumer and non-banking financial business of Citibank. The deal, announced in March 2022, has been closed for a cash consideration of $1.41 billion (Rs 11,630 crore) in one of the largest deals in the Indian financial services sector. The acquisition will help Axis bridge the gap with larger peers such as ICICI Bank and HDFC Bank.
With effect from today (March 1), the home and personal loan, credit card and insurance businesses of Citibank have now come under the control of Axis Bank.
It has been almost a year since the acquisition was announced in March, 2022. Just a few days ago, Citibank removed its signboard from its landmark Kanak Building office on Kolkata’s Chowringhee Road – the place where the bank started its operations in India in 1902. 2021, Citigroup announced its plans to exit 13 international consumer banking markets, shifting its focus to wealth management and away from retail banking in places where it is small.
In a stock exchange filing last week, Axis Bank had informed that it had obtained the consent of Citibank’s customers to take over the business.
What does the deal mean for Axis Bank?
On its website, the bank said last year that the acquisition of Citibank’s 3 million unique customers in India would enhance its presence in key identified growth regions. The website also said that Axis Bank’s card balance sheet will grow by 57 per cent with an additional 2.5 million Citibank cards, making it one of the top three card businesses in the country.
Axis Bank’s large loan book will be complemented by Citibank’s affluent customer base, thereby creating product and branch footprint synergies.
The acquisition will also transfer over 1 million customers to Axis Bank and an average salary of Rs 70,000 per month, which will strengthen its salary business.
What will change for customers?
Axis Bank said Citibank’s customers will benefit from its increased scale, wider geographic reach and breadth of products and offerings. Axis Bank will gain access to seven offices, 21 branches and 499 ATMs across 18 cities in India.
Citibank is one of the leading financial institutions in the country when it comes to card transactions. According to an RBI report, transactions worth Rs 3,000 crore are done by 2.5 million Citibank credit card users.
While both the banks have said that customers will not face any kind of hassle, reports claim that they will have to go through Know Your Customer (KYC) routine again. However, this process will be done in phases to minimize the inconvenience to the customers.
axis bank third quarter results
For the quarter ended December 2022, India’s fifth-largest lender by market value reported a net profit of Rs 5,853.1 crore, up 61.9 per cent from the same period a year ago.
The bank’s net interest income (NII) – or the difference between interest earned and interest paid – rose 32.4 per cent on a year-on-year basis to Rs 11,459.3 crore, according to a regulatory filing.
featured video of the day
India Gives Hope For The Future: Bill Gates After Meeting RBI Governor Shaktikanta Das