Nearly a million customers of Citibanamex, Citigroup’s retail arm in Mexico, have closed their accounts since it was put up for sale last January, according to the National Commission on Banking and Securities (CNBV) data. The upcoming operation is the reason.
local unit Citygroup In December 2022, he registered an 11% year-on-year drop in his deposit accounts, which do not include his pension area, according to the latest figures from the national banking regulator.
Quantity clients The company’s share of total deposits fell to 8 million from nearly 9 million between December 2021 and December 2022, according to the company. CNBV.
your portfolio loans The period also saw below-average growth in dollar terms, while total loan accounts fell 14% to 1.2 million from 1.4 million, according to the regulator.
Citybanamex it also ranked third among the top five banks in terms of growth in peso deposits over the period.
The bank said in a statement that “the amount of total client resources (deposits) managed by Citibanamex increased in December 2022 compared to December 2021.” The bank declined to comment on the number of accounts.
Citi’s year-long journey to sell off its retail division is not yet complete. Grupo México, from a billionaire Herman Larreais among the final candidates Reuters. It is not yet clear what effect (if any) the sale announcement had on customer appetites.
However, Mexico’s other four largest banks are Banorte, santanderBBVA Mexico and HSBC– According to official data, the number of customer deposit accounts increased over this period.
They all also registered higher loan portfolio growth than Banamex in dollar terms, and all saw an increase in their total loan accounts. Banorte and HSBC declined to comment, while BBVA did not respond to a request for this.
Santander explained that he followed an “aggressive” strategy to develop the bank.
Carlos Alberto Gonzalez Taberes, Analyst Monexbelieves that, at first glance, the sales process leads to the loss of customers.
“This is a risk factor that has just been observed. When an announcement is made sales process this style because naturally a lot of clients feel a little insecure and say move,” he said.
Arturo Morales Castro, professor of finance at the National Autonomous University of Mexico, who closely followed the operation, agreed.
“The data reflects the uncertainty of the Citi sale (…) in this Citi valuation process. migration of clients to other banks“, said.
Although the volume of deposits and the number of users are not the main indicators of the profitability of the bank, Morales said that they are still important indicators.
At the same time, banks love Banrejoa medium-sized lender, said on phone calls that they see the sale process as an opportunity to attract Citibanamex customers.
Possible customer churn could be one of the concerns facing the buyer of Citi’s business, including a cap on spending cuts given that the Mexican president Andres Manuel Lopez Obrador He stated that he opposes mass layoffs.
However, one area where Citibanamex did not see a drop was in pensions, also part of the sale. Its participation in the pension fund management market (Afores) increased from 9.6 million accounts in December 2021 to 9.9 million next year, according to the latest government data.
Only a few banks participate in Mexico’s pension offering, so the Afore division is an important part of Banamex’s valuation. Citibanamex will publish its results on Monday, including internal customer acquisition numbers.
Reuters
Source: Aristegui Noticias
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
