Citigroup Gets Board Nod to Sell AO Citibank, Advances Russia Exit

Citigroup Inc. C announced that it has received the required internal approval to proceed with the planned sale of AO Citibank, which houses the company’s remaining operations in Russia, to Renaissance Capital. The transaction is expected to be signed and closed in the first half of 2026, subject to regulatory approvals and customary closing conditions.The approval marks another milestone in Citigroup’s multi-year efforts to exit non-core markets and streamline its global operations, while fully winding down its Russia-related exposure.Details of the AO Citibank Sale Approvals  On Dec. 29, 2025, the company’s board of directors approved a plan to sell AO Citibank, clearing a key internal requirement for the transaction. The approval enables C to classify its remaining Russian operations as “held for sale” beginning in the fourth quarter of 2025.The internal approval followed a key regulatory development in November 2025, when a presidential order posted by the Kremlin authorized Citigroup to transfer its Russia-based banking unit to Moscow-headquartered Renaissance Capital. This Russian government approval allowed the company to move forward with operational preparations and pursue the remaining regulatory requirements necessary to complete the transaction.Citigroup’s exit from Russia has been underway for several years. The company expanded the scope of its planned exit in March 2022 to include local commercial banking. Subsequently, in August 2022, Citigroup confirmed plans to wind down its consumer and local commercial banking businesses in the country, including pursuing sales of certain consumer banking portfolios.Financial Impact of the Sale of Russian Unit on CitigroupAs a result of applying “held for sale” accounting, the company expects to record a pre-tax loss on sale of approximately $1.2 billion ($1.1 billion after tax) in the fourth quarter of 2025. The loss will reduce Other Revenue through a valuation allowance in the same quarter.The loss on sale consists of an approximately $1.6 billion currency translation adjustment (“CTA”) loss, which will also remain in Accumulated Other Comprehensive Income (“AOCI”) until the transaction closes. This impact is expected to be partially offset by an estimated $0.2 billion benefit related to the future derecognition of Citigroup’s fully reserved net investment, as well as approximately $0.2 billion in expected proceeds from the sale. All figures are based on balances as of Sept. 30, 2025. The loss on sale remains subject to change, particularly due to potential foreign exchange movements before closing.Citigroup also noted that the cumulative impact of the CTA losses recognized in the fourth quarter and the amounts released from AOCI upon closing would be capital neutral to the company’s Common Equity Tier 1 (CET1) capital.Despite the near-term accounting impact, C expects the overall divestiture to benefit its CET1 capital over time, largely driven by the deconsolidation of associated risk-weighted assets.Citigroup’s Prior Efforts to Streamline Global OperationsCitigroup has been reshaping its global footprint under CEO Jane Fraser’s transformation strategy, which focuses on strengthening core businesses through international streamlining. In April 2021, the company announced plans to exit consumer banking operations in 14 markets across Asia and EMEA, and has since completed exits in nine countries. In December 2025, Citigroup divested a 25% equity stake in Banamex to a Mexican business leader, advancing its plan to fully separate the business and prepare it for a future initial public offering (“IPO”). Earlier, in May 2025, the company also agreed to sell its consumer banking business in Poland.In December 2024, Citigroup completed the separation of its institutional banking operations in Mexico from its consumer and middle-market units and sold its China-based consumer wealth portfolio in June 2024. As part of its broader streamlining efforts, the company continues to make progress with the wind-down of its Korea consumer banking operations while advancing plans for the IPO of its Mexican consumer and small- and middle-market banking units.Together, these initiatives are expected to free up capital and support increased investment in key wealth management hubs such as Singapore, Hong Kong, the UAE, and London. Supported by this strategy, Citigroup expects total revenues to exceed $84 billion in 2025, with revenues projected to expand at a 4–5% compound annual growth rate through 2026, underscoring management’s confidence in the long-term benefits of its transformation efforts.C’s Price Performance & Zacks RankShares of Citigroup have gained 37% over the past six months compared with the industry’s growth of 18.1%.Image Source: Zacks Investment ResearchCurrently, C carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Similar Steps Taken by Other Financial FirmsIn November 2025, The Goldman Sachs Group, Inc. GS reached an agreement with ING Bank Slaski to divest its Polish asset management firm, TFI. The deal, targeted for completion in the first half of 2026 pending regulatory signoff, will end Goldman’s presence in the Polish retail investment market while cementing ING’s long-term ambitions in the region.GS acquired control of what is now Goldman Sachs TFI through its 2022 takeover of NN Investment Partners. By selling its stake now, Goldman sheds its majority exposure in a mature but relatively small asset-management market — likely freeing up capital and management bandwidth for other priorities.In September 2025, HSBC Holdings PLC HSBC agreed to sell its retail banking business in Sri Lanka to Nations Trust Bank PLC.This divestiture is part of broader streamlining efforts by HSBC announced in October 2024 to enhance operational efficiency. 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(C): Free Stock Analysis Report HSBC Holdings plc (HSBC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks