Citigroup (NYSE:C) has completed the sale of its Taiwan consumer banking businesses to Singapore’s DBS Group Holdings (SG:D05). The divestiture is anticipated to enable Citigroup to free up $1.2 billion in capital.
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The deal consists of Citi’s retail operations, encompassing retail banking, credit card, mortgage, and unsecured lending activities. Furthermore, about 3,000 employees of Citigroup were transferred as part of the agreement. However, the company has retained its institutional business in Taiwan.
It is worth highlighting that the sale is part of Citigroup’s broader strategy to exit consumer banking across 14 markets in Asia, Europe, the Middle East, and Mexico. Since the announcement, the company has divested the business in nine markets.
According to Citi, the goal of this strategy is to release capital, streamline operations, and focus on strengthening other areas of its business, such as wealth management. As a result, Citigroup aims to enhance its overall financial performance and achieve greater efficiency.
What is the Future of Citigroup Stock?
By streamlining its operations and maintaining a diversified portfolio alongside a robust multinational client base, the company remains well poised to achieve its medium-term return-on-equity goal of 11% to 12%.
Turning to Wall Street, Citigroup earns a Moderate Buy consensus rating based on seven Buys, 10 Holds, and one Sell rating assigned in the past three months. Additionally, Citigroup stock’s average price target is $54.33, implying a 21.9% upside potential.
Importantly, hedge funds are bullish on C stock, as they increased their holdings by 17.9 million shares in the last quarter. Ken Fisher’s Fisher Asset Management and Warren Buffett’s Berkshire Hathaway Inc. are among the 16 hedge funds that bought more shares of Citigroup.
