Citigroup India is strategically positioned with a substantial capital buffer that can sustain its operations for the next two years, even after its exit from the retail banking sector. K Balasubramanian, Citigroup's head for the India subcontinent, revealed that the strategic shift to focus on corporate operations following the sale of its retail business to Axis Bank has spurred considerable growth for the bank.
The divestment of the retail business in March 2023 resulted in a gain of approximately ₹11,000 crore. Adjusting for this one-time gain, Citigroup India has demonstrated impressive financial performance. Its revenue has increased by 28% in two years, climbing from ₹17,314 crore to ₹22,173 crore. Similarly, the profit after tax, adjusted for the divestment gain, rose by 32% from ₹4,700 crore to ₹6,193 crore (₹6,237 crore in FY24) over the same period. The bank's total assets have also seen a 25% increase post-divestment, growing from ₹2.17 lakh crore to ₹2.70 lakh crore as of March 2025 (₹2.59 lakh crore in FY24).
Citigroup's loan book has experienced a significant expansion, rising by 45% from ₹50,000 crore to ₹72,000 crore. Deposits have also increased substantially, growing by 36% from ₹1.47 lakh crore to ₹1.99 lakh crore. This growth underscores the success of Citigroup's strategic realignment towards institutional business.
Balasubramanian highlighted that the decision to exit retail banking was driven by the intention to concentrate on the institutional business. Citigroup holds a market share of over 8% in transaction banking, despite its absence in the oil and defense sectors. With India's Viksit Bharat vision requiring an estimated $3-4 trillion in capital investment, Citigroup aims to leverage its strengths to facilitate foreign direct investment (FDI) and foreign institutional investment (FII). Currently, one in four foreign companies present in India and one in three FIIs bank with Citigroup. The bank also holds an early-teens market share in foreign exchange.
Citigroup's exit from retail banking in India mirrors a broader trend among foreign banks since 2009, as the increasing capital and regulatory demands in India have prompted them to consolidate their operations and focus on profitability. CEO Jane Fraser stated that Citigroup is focusing on wealth management and its institutional businesses in Asia. The bank is concentrating on wealth hubs like Singapore, Hong Kong, the UAE and London.
The transition for customers and employees has been varied. Axis Bank acquired Citigroup's consumer banking business in India for approximately 116.03 billion rupees, incorporating around 2.4 million customers, including over 1.8 million credit cardholders and more than 0.9 million retail banking customers. Over 3,200 employees were also transitioned to Axis Bank.
