Although Citi has sold its stake in Multi Commodity Exchange of India (MCX), it has no intention to part with its stake in Housing Development Finance Corporation (HDFC), reported the Business Standard citing Mark Robinson, CEO of the bank in South Asia.
Citigroup currently holds a 11.68% stake in HDFC through its two subsidiaries, Citigroup Holdings Mauritius and Citigroup Strategic Holdings Mauritius. Citi had increased its stake in HDFC, by buying a 9.3% stake from Standard Life.
Mr Robinson said: “That decision has been take in New York and Vikram Pandit (the global CEO) is very clear that we want to keep the stake. Our holding in HDFC is part of Citicorp, whereas the MCX stake was part of Citi Holdings.
Reportedly, Citigroup posted a $7.58bn loss for the fourth quarter of 2009. Against this backdrop, it has been offloading non-core assets globally to raise capital and focus on a much smaller portfolio. It may even pareback its operations from certain countries where its presence is not significant.
Hence, it has split its operations into two groups, Citicorp and Citi Holdings. Citicorp consists of all the units it intends to retain, while Citi Holdings houses of those it plans to wind down. Citi Holdings includes the consumer finance arm CitiFinancial, which incurred huge losses during the financial crisis.
Mr Robinson added: “CitiFinancial probably makes up 80-90% of Citi Holdings. Since most of the businesses under CitiFinancial are integrated, we are looking to sell it whole rather than piecemeal.”