CitiFinancial to sell Rs 4,500 crore assets in tranches to banks, NBFCs

Source :FC :Falaknaaz Syed, Anto T Joseph Sep 14 201, Mumbai
Tags: CitiFinancial




CitiFinancial Consumer Finance India hopes to sell 
retail mortgages and personal loans worth Rs 4,500 crore 
to non-banking financial companies and banks over the next two years.


The non-banking arm of Citigroup has sold part of its retail mortgages to Development Credit Bank and Religare Finvest, though the exact quantum of assets could not be ascertained. The NBFC is negotiating with banks and leading NBFCs to sell assets.

A senior official of Citibank told Financial Chronicle that they were selling the assets of CitiFinancial in small tranches to banks and NBFCs. “Around Rs 4,500 crore of assets are left and we are managing them for value. We will sell these assets at a premium and not at a discount,” he said.

Citigroup, which earlier wanted to sell CitiFinancial assets lock, stock and barrel, could not do so because of valuation issues.

A Citigroup spokesperson said after the global financial crisis, Citi decided to bifurcate its assets into core and non-core. “CitiFinancial would be a non-core asset and would be managed for value. We have publicly stated that we are selling the portfolio,” he said.

Murali M Natrajan, managing director and chief executive officer of Development Credit Bank, said, “I do remember having done a tranche of a small portion of retail mortgages around two months back. However, I cannot divulge the amount.”

“As part of our normal business strategy, we buy retail mortgages if they fit within our strategy, geography and have acceptable credit parameters,” said Natrajan.

Several calls and a text message to Kavi Arora, chief executive officer of Religare Finvest, remained unanswered. Religare Finvest, the NBFC of Religare, offers small & medium enterprises mortgages, loan against property, working capital loans, commercial assets and loans against marketable securities. According to the NSE website, on March 31, 2010, CitiFinancial had non-performing assets worth Rs 1,068.41 crore as against Rs 908.36 crore a year ago.