Citi Brazil has reached a definitive agreement with Banco Itaú Unibanco to sell Credicard, its non-banking credit card and consumer finance business, subject to approval by Brazilian regulatory authorities.
Once approved by Brazilian regulators, the transaction is expected to generate a gain on the sale of approximately $300m after-tax ($0.10 cents per share) at closing. The business activities will be reflected in discontinued operations beginning in the second quarter of 2013.
The transaction includes 96 Credicard stores and approximately $3.260bn in consumer loan balances as of December 31, 2012. Included in the transaction are the portfolios of Credicard-branded credit cards, as well as a personal loan portfolio. The transaction does not include Corporate cards, the Citi and Diners branded portfolios, and the Credicard Platinum portfolio (except for Exclusive), or Credicard American Airlines cards, which will be migrated to the Citi brand and will continue to be managed by Citi.
Citibank’s retail branch network will not be affected by this transaction.
