Barclays To Buy Citigroup's Credit Card Operations In Portugal
September 29 2009 - 7:09AM
Dow Jones News
Barclays PLC (BCS) said Tuesday that it will buy Citigroup
Inc.'s (C) credit card business in Portugal, as it continues to
push for expansion outside the U.K.
Barclays is acquiring about 400,000 credit card accounts with
gross assets of about EUR644 million, it said.
The bank didn't disclose how much it is paying for the business.
The Wall Street Journal has reported the figure to be less than
$100 million, citing people familiar with the acquisition.
Barclays currently has more than 130 branches in Portugal, and
Frits Seegers, chief executive of Barclays Global Retail and
Commercial Banking, said the acquisition will put the bank among
the five top credit card players in the country.
"With this acquisition, we will deliver a real step change in
our business, significantly increasing Barclays Portugal's customer
base and providing extensive cross-sell opportunities," Seegers
said.
Earlier Tuesday, Barclays Chief Executive John Varley said the
goal for the bank's global retail and commercial banking business
is to have half of its profit generated from international
operations.
In the first half of 2009, businesses outside the U.K. accounted
for 18% of the operation's profits.
Citigroup, which has been hard hit by the global financial
crisis, is pulling back its presence in the U.S. and abroad.
In a recent presentation, CEO Vikram Pandit classified the
bank's Western Europe retail banking and cards portfolios as
non-core assets.
"The transaction is in line with Citi's goal to reduce assets,
tightly manage risks and optimize the value of assets in Citi
Holdings, while working to generate long-term profitability and
growth from Citicorp, which comprises its core franchise,"
Citigroup said in a separate statement.
Barclays' acquisition is subject to competition clearance by
Portuguese authorities and is expected to close before the end of
the year.
At 1037 GMT, Barclays shares were up 6 pence, or 1.6%, at 371
pence in a slightly lower overall market.
-By Patricia Kowsmann, Dow Jones Newswires. Tel
+44(0)207-842-9295, patricia.kowsmann@dowjones.com