Why is Citigroup exiting 13 global consumer banking markets?

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Citigroup is exiting 13 global consumer banking markets to reorient its strategy towards wealth management and to focus on areas where it possesses greater competitive scale.

Citigroup has announced a significant strategic shift, which involves divesting its consumer banking operations in 13 international markets. This decision stems from a company-wide effort to concentrate resources and investment on wealth management, a sector identified as offering superior growth prospects. The company aims to strengthen its presence in key global financial hubs, namely Singapore, Hong Kong, London, and the United Arab Emirates, while discontinuing retail banking services in markets where its scale is deemed insufficient for effective competition.
Reallocation of Resources to Wealth Management

The strategic pivot is spearheaded by CEO Jane Fraser, who views the move as an opportunity to "double down" on the wealth management business. This segment is perceived to hold greater potential for expansion and profitability compared to maintaining a dispersed retail banking presence in less dominant markets. The company's objective is to leverage its existing strengths in global financial centres to build a more robust and focused wealth management offering.
Insufficient Scale in Exited Markets

A primary driver for exiting these 13 markets is the lack of competitive scale. Citigroup has explicitly stated that it does not possess the necessary market share or operational footprint to compete effectively in these regions. This assessment applies to markets such as China and India, as well as the other eleven countries including Malaysia.
Financial Impact of Exited Markets

In the 13 international markets designated for exit, Citigroup's global consumer banking business generated US$6.5 billion in revenues by the end of 2020. This segment encompassed 224 retail branches and held US$123.9 billion in deposits. The majority of these markets are located in Asia, underscoring the significant regional impact of this strategic realignment.
Specific Markets Affected by the Decision

The 13 markets from which Citigroup will withdraw its consumer banking operations include China and India. Additionally, the company is exiting Australia, Bahrain, Indonesia, South Korea, Malaysia, the Philippines, Poland, Russia, Taiwan, Thailand, and Vietnam. This comprehensive withdrawal from these specific retail banking landscapes signifies a deliberate reshaping of Citigroup's global consumer banking footprint.

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Why is Citigroup exiting 13 global consumer banking markets?

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