Citicorp, Eye on Mexico, to Add 8th Branch
Citicorp will open next year a retail banking branch in the Mexican city of Guadalajara, a move that may signal a more-ambitious expansion in the country.
The Guadalajara branch will be the second Citicorp office added in Mexico since August, when the bank opened a branch in Monterrey.
The bank now has seven locations in the country.
The Mexican government agreed earlier this year to allow Citicorp to open additional branches and fund itself by taking in local deposits.
An Unusual Presence
Citicorp is the only foreign bank allowed to engage in commercial banking in Mexico. It was grandfathered under a law passed in the 1930s.
In a speech earlier this year in Mexico, Citicorp chairman John Reed said the bank hoped to add up to 40 more branches in Mexico.
However, Mexican banking sources said that Citicorp's expansion in Mexico might be slowed by the bank's capital requirements and mounting commercial real estate loan problems in the United States.
Assets Near $3 Billion
Citicorp has some $2.9 billion in Mexican assets on its books, including about $500 million from its branches in Mexico.
The bank engages in everything from corporate and trade finance to foreign exchange and custodial services in Mexico, but has been building up international capital market issues for Mexican corporations and expanding into the profitable local retail banking sector.
Citicorp, despite its setbacks at home, is still committed to building a worldwide consumer banking franchise, Mr. Reed has said. His statement followed the recent divestiture of an Italian retail banking subsidiary that the bank said was not a strategic asset.
The Mexican expansion comes on the heels of Citicorp branch openings in several other countries over the last several months.
Offices in Other Cities
Since the start of the year, the bank has opened offices in Warsaw, Prague, Tunisia, China, Algeria, and Germany and is investing heavily in expanding its Japanese operations.
On Monday, Citicorp said that its German consumer bank had opened a branch in eastern sector of Berlin.
The bank added that it plans to open three more branches in Berlin as well as branches in three other cities in eastern Germany.
PHOTO : John Reed Hopes to have 40 branches