Citigroup is weighing a deal for buy the mexican bank Deutsche Bank AG amid plans to establish a new local unit, as abandons retail operations in the countryaccording to people familiar with the matter.
Las talks about operations Mexican from the German bank is in its first stage and they may not result in a settlement, said the people, who asked not to be identified because the matter is private.
Any sale would require the regulatory approval and Deutsche Bank would keep its brokerage operation that it relaunched in the country earlier this year, the people said.
“Citi has operated in Mexico for more than a century and the country will remain among the Citi’s Major Institutional Markets outside the United States,” a Citigroup spokesman said in an emailed statement.
“As we have said, we have the intention to continue operating a locally licensed banking business in Mexico through our group of institutional clients and our private banking franchise”.
A Deutsche Bank representative declined to comment.
Citigroup CEO Jane Fraser said last month that the company began the sale process of its consumer banking, small business and medium business divisions in Mexico, although an initial public offering is still on the table. The unit “is attracting a lot of attention” and the company has begun to capture the interest of buyers in preliminary sales talks, Fraser said at the time.
A deal with Deutsche Bank would make it easier for Citi to continue serving large corporations and high-net-worth clients after the sale, the people said. get one banking license in Mexico can take yearsas the country’s banking regulator has been hampered by an exodus of experienced officials during the administration of President Andrés Manuel López Obrador.
Deutsche Bank had been liquidating its operations in Mexico since 2015, when it decided to pull out of 10 countries. After two years of talks to sell its operations to InvestaBank de Méxicothe deal was canceled at the end of 2018 amid a price dispute and after a major InvestaBank shareholder was sentenced in the United States for tax fraud.
The local unit of the German bank now has only 1.6 billion pesos in assetsmostly government debt, and twelve employees, according to documents.