MANILA, Philippines – Citi completed the sale of its consumer business in the country to Union Bank of the Philippines (UnionBank).

The deal covers Citi’s local credit card, unsecured lending, deposit, and investment businesses, as well as Citicorp Financial Services and Insurance Brokerage Philippines.

UnionBank is the seventh largest publicly listed bank in the Philippines. With the Citi consumer portfolio, UnionBank will become part of the country’s top three credit card issuers in terms of usage and spends.

UnionBank said the total cash consideration is based on the net assets of the Citi Philippines consumer banking business plus a premium of P45.3 billion. Based on the closing statement as of June 30, the net asset value of the business was at P26.71 billion.

“We are now a much larger consumer bank. We added a consumer portfolio that is well-run and very profitable. This will provide us better margins and allow us to maintain our industry-leading ROE (return on equity) moving forward,” said Edwin Bautista, UnionBank president and chief executive officer.

The transaction is expected to result in a capital benefit of around $700 million, Citi said.

“This transaction represents a positive outcome for our clients, our colleagues, and our firm. Citi will continue to serve institutional clients in the Philippines and across our global network as we have for over 120 years,” said Citi Philippines CEO Aftab Ahmed.

Some 1,540 Citi staff have been transferred to UnionBank. – Rappler.com