Citi’s simplicity pays off in Latin America
It is one thing to simplify a business plan but quite another to execute it. Nevertheless, Citi appears to be on the verge of making its new simple approach, well, simple.
For a truly global bank, it is one thing to decide upon a new, simpler strategy. It is quite another to implement it. Internal politics, established practices and vested interests tend to react to stringent cuts to entangled operations and networks of businesses and subsidiaries.
So Citi’s execution of its new business model in Latin America is notable. Its acknowledgement that it was over-extended in the region – with too many retail banks operating in small but competitive markets – led to a succession of disposals. The sale of consumer operations in Honduras in 2014, was followed by disposals in Nicaragua and Peru in 2015, Cost Rica, Panama, Guatemala and El Salvador in 2016 and Argentina and Brazil in 2017.
The sale of Citi’s Colombian bank at the end of January this year left Citi with just one exception – Mexico – and it is an easy qualification for Jane Fraser, chief executive of Citi in Latin America since April 2015, to explain.