New York/Shanghai Citigroup Inc. announced today it has sold its 2.71 percent equity stake in Shanghai Pudong Development Bank (SPDB) via block trade to institutional investors. Total proceeds from the transaction are expected to be US$668 million at the current exchange rate, resulting in an after-tax gain of approximately US$349 million.
Coinciding with this move, Citi and SPDB also announced today that the two companies have struck a new strategic arrangement to cooperate together. The new cooperation arrangement will see Citi and SPDB pursue discussions in a number of areas, including utilizing Citi's global network and credit lines in support of any future international expansion plans by SPDB, as well as the provision of technical assistance and training services. The new arrangement reflects the strong and successful relationship the two companies have maintained over many years, and both companies desire to continue to actively work together in areas of mutual interest.
"Today's announcement marks a new phase in our longstanding strategic relationship with Shanghai Pudong Development Bank," said Andrew Au, Chief Executive Officer of Citi China. "China remains a top priority market for Citi and in 2012 we will continue to invest in China in support of our growing client base across all lines of business."
Citi is one of the largest international banks in China, employing more than 6,000 people. In 2011, Citi expanded to three new cities in China, and rolled out 12 new "smart banking" consumer outlets, including the first by any bank at an airport in China. Citi also opened its fourth lending company in China, a model designed to provide credit to individuals and small business owners in smaller towns in China. Citi works closely with a wide range of clients in China, including those Chinese companies expanding overseas. In 2011, Citi's "China Desk" initiative, under which Citi sends senior Chinese bankers to strategic locations around the world, expanded from the initial locations of Hong Kong, Singapore, London and New York, to include Dubai, Johannesburg, Nigeria and Algeria. In 2012, Citi has announced plans to launch a credit card business in China, and also preliminary regulatory approval for its new securities joint venture with Orient Securities.
Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services and wealth management.
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Citi first established an office in China on May 15, 1902, in Shanghai. In April 2007, Citi was among the first international banks to locally incorporate in China. Citi's locally incorporated entity is known as Citibank (China) Co Ltd, which is wholly owned by Citibank N.A. Today Citi is a leading international bank in China, and has thirteen corporate bank branches - in Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Chengdu, Hangzhou, Dalian, Chongqing, Guiyang, Nanjing, Changsha and Wuxi- and forty-seven consumer bank outlets. With operations in more than 160 countries around the world, Citi is the most global of all international banks in China.