Has Banamex lost its sparkle?
It has been described as a jewel in Citi’s crown, but it may be merely the most valuable component of an ailing empire. A new management team needs to restore its leadership in Mexico. Chloe Hayward reports from Mexico City.
BANAMEX IS regularly touted as one of Citi’s most prized possessions. Latin America was the only region to make a profit for the group – albeit just $6 million – in the dark days of the fourth quarter of 2008, with Banamex leading Citi’s Latin retail presence. And in 2009, despite intense pressure to raise funds, Citi showed itself determined to hang on to its wholly owned subsidiary.
As Citi emerges from the crisis, its love affair with Banamex is far from over. In January, Manuel Medina-Mora, the long-term chief executive of the Banamex banking group, was promoted to become chief executive of consumer banking for the Americas and chairman of Citi’s global consumer council. Yet as Medina-Mora moves up Citi’s global hierarchy on the back of his successes in Mexico, some are asking: Is Banamex really as successful as Citi likes to think?
In 2000, Banamex was a clear leader in the Mexican market. Then BBVA acquired Bancomer and took the number one spot. Banamex’s high level of innovation and wealth of knowledgeable management still made the bank a very attractive asset when Citi acquired it for $12.5 billion in 2001. But as the years have passed, BBVA Bancomer has become the unambiguous market leader in Mexico, leaving Banamex in its wake.