Grupo Mexico in pole position for Citibanamex
Restrictions on redundancies force out larger banks in Mexico from bidding for business.
Grupo Mexico is now the favourite to buy Citi’s retail banking business in Mexico, as other local banks drop out of the acquisition and Citi’s managers turn against the idea of listing the bank through an IPO.
That is the consensus view of many bankers in Mexico City that Euromoney spoke to at the beginning of December.
Andrés Manuel López Obrador, Mexico's president, has stipulated that any bank buying Citibanamex should not engage in widespread reductions in headcount, which has destroyed the rationale of any bid for the large banks already operating in the country.
In late October, Banorte – the country’s third-largest bank by loans, deposits and assets – announced it was pulling out of talks to buy Citi’s retail bank by stressing that it would only engage in an acquisition that was accretive.
The rules placed on the acquisition by the Mexican president ultimately meant that large banks couldn’t generate the synergies that would justify buying the bank
In Banorte’s first-quarter 2022 results conference call, Jose Marcos Ramirez Miguel, the bank’s chief executive, summed up his position.