Financial services major Citigroup is looking to either sell or close its private banking business in Italy, a move that could result in hundreds of job losses, says a media report.
"Citigroup is looking to sell — or failing that, to close — its private banking business in Italy and is to reduce its presence in the country by about half," UK daily The Financial Times has reported.
The daily said the move which is part of the group's global restructuring programme, is expected to see the number of people employed in Italy fall from 1,000 to about 500 by the end of this year, with most of the job losses coming in its Italian consumer finance business.
"That unit, which has 65 branches around the country, is being closed."
According to the report, Citigroup has held talks with Banco Santander of Spain, among others, about selling its Italian private business, which has assets of about euro 2 billion ($2.8 billion) under management and is considered too small to be competitive.
"If the bank cannot find a buyer, it is expected to close the unit," it added.
The daily noted that once the restructuring is complete, Citigroup's business in Italy would be concentrated on corporate and investment banking and global transaction services.
Quoting Citigroup's head of banking in Italy Sergio Ascolani, the Financial Times said, "It's absolutely rational, with current markets, to exit from businesses that are marginal and invest in areas where Citi is globally strong."
"We are not exiting Italy, just rationalising here," Ascolani was quoted as saying.
The report noted that Citigroup's scaling down jobs in Italy represents a dramatic shift in policy for the bank, which expanded rapidly around the world in the past decade.
"But it is consistent with its strategy of shrinking its balance sheet and divesting itself of non-core assets as it tries to revive its fortunes after suffering billions of dollars of losses during the global financial crisis," it added.
