As part of its withdrawal from Russia in opposition to the conflict in Ukraine, US bank Citigroup will close all remaining branches and consumer banking operations there.
2,300 employees in the nation will be impacted by the change, which comes after Western companies left the country due to the violence.
The largest US bank in Russia, Citi, has previously announced its intention to withdraw. But it has been making futile attempts to sell its company. While its local consumer operation would close, a spokesperson said that Citi would still serve the nation’s worldwide institutional clients.
In particular, they claimed, “those that are shutting down their own operations in the country.”
The bank, which has 15 locations in Russia, anticipates losing roughly $170 million (£140 million) due to the pullout over the next 18 months.
Titi Cole, the CEO of Citi, said, “We have looked at a number of strategic options to sell these operations over the past few months.”
Given the numerous environmental complexities, it is obvious that the wind-down option makes the most sense.
The bank stated that in order to lessen its exposure to Russia as part of the withdrawal, which will start in the upcoming months, it will keep actively pursuing sales of “certain Russian consumer banking portfolios.”
Citi’s residual exposure to Russia was $8.4 billion (£7.1 billion) as of the end of June.
In April 2021, the bank announced that it would close a number of its retail locations. However, after the Ukraine War broke out, the bank expanded its plans to include the withdrawal of all commercial banking activities.
It follows in the footsteps of countless other companies that have left Russia, either for ethical reasons or because doing business it is now difficult due to Western sanctions.
Among the names still in existence are Starbucks, Amazon, McDonald’s, and Apple.
In February, the US outlawed American citizens and companies from doing business with Russia’s wealth fund, finance ministry, and central bank.
The move, according to the central bank of Russia, will have an impact on consumers’ deposit accounts, investments, loans, and credit and debit cards.