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Axis Bank on Wednesday said it has completed the acquisition of Citibank's retail business in India for a final cash consideration of Rs 11,603 crore.
The sale excludes Citi's institutional client businesses in India.
The third-largest private sector bank said the acquisition, announced first in March last year, will not necessitate any new capital requirements and stressed that the attrition numbers on customers are much better than expected.
A total of 2.4 million Citi customers in the country have consented to bank with Axis Bank after the deal as against 3 million at the time of announcing the deal, managing director and chief executive Amitabh Chaudhry told reporters in Mumbai.
He said 96 per cent or 3,200 of the Citi employees have joined the bank now.
The core capital buffer will go down by 1.70 per cent from the 15.55 per cent reported in December, Chaudhry said, committing to fund and grow the business.
The entire integration will happen over the next 18 months, Chaudhry said, adding that there will be a hit of Rs 1,500 crore to be taken as implementation costs which will be amortised as the costs are incurred.
Chaudhry said the bank account details, cheque books, product benefits and privileges, debit card details will be the same for the Citi customers who are joining as Axis Bank customers.
Axis Bank is the fourth-largest issuer of credit cards with a total base of 8.6 million cards and the deal will add about 2.5 million credit cardholders, making it one of the top three cards businesses in the country.
Last year, Axis Bank agreed to purchase Citibank's India Consumer Business from Citibank NA (acting through its branch in India) and the NBFC Consumer Business from Citicorp Finance (India) Limited (CFIL), as going concerns, without values being assigned to individual assets and liabilities to either business.
This was subject to fulfilment of specific conditions and obtaining requisite approvals at a total purchase consideration up to Rs 12,325 crore.
"We now wish to inform you that completion of the acquisition of Citibank's India Consumer Business from CBNA and the NBFC Consumer Business from CFIL as going concerns, without values being assigned to individual assets and liabilities for either business shall happen on March 1, 2023," Axis Bank said in a regulatory filing.
"The said cash consideration is subject to contractual and customary true up and / or true down adjustments and changes in the business position from January 31, 2023 to 24:00 hours February 28,2023," it said.
Accordingly, the businesses of CBNA and CFIL stand transferred to Axis Bank and the bank becomes the owner of Citibank's India Consumer Business and NBFC Consumer Business effective from March 1, 2023 subject to and in accordance with the requirements and terms of the agreed contractual documentation and settlement of consideration, it said.
Axis, which has a retail book of nearly Rs 4 lakh crore, has acquired about 3 million unique customers of Citibank India, seven offices, 21 branches and 499 ATMs across 18 cities.
Citi's retail book is nearly Rs 68,000 crore, of which retail loans account for Rs 28,000 crore.
With 1.2 million bank accounts, the total India business contributes 1.5 per cent in profit to the lender's global book.
Apart from the institutional banking business, it will continue to focus on offshoring or global business support rendered from centres in Mumbai, Pune, Bengaluru, Chennai and Gurugram.
In April 2021, American banking major Citigroup announced its plan to exit from the consumer banking business in India as part of its global strategy.
The business comprises credit cards, retail banking, home loans and wealth management.
The bank has 35 branches in the country and employs about 4,000 people in the consumer banking business.
Citigroup entered India in 1902 and started the consumer banking business in 1985.