New York: The troubled financial services
major Citigroup on Tuesday said it is selling its Diners Club North
America card business to BMO Financial Group, as part of its
strategy to sell its non-core businesses and generate long
The company, however, did not disclose the financial
details of the deal.
In a statement here Citigroup said, the sale is expected
to reduce Citi`s assets in Citi Holdings by about USD 1
billion and is not expected to have a material impact on Citi`s net
income or capital ratios.
"The sale of this business is consistent with Citi`s
strategy to optimise the assets and businesses within Citi
Holdings while working to generate long-term profitability and
growth from Citicorp, which comprises its core franchise,"
Throughout this year, Citi, which was the worst hit of
the credit crisis, has been selling off its non-core
divisions. Under the deal, BMO would have exclusive rights to
issue Diners Club cards to corporate and professional clients
in the US and Canada. The deal, subject to regulatory
approvals is expected to close by March 31, 2010.
In a separate statement, BMO said the move would
immediately more than double BMO`s overall corporate card
"This acquisition will immediately enhance our
competitive position by placing us among the top commercial
card issuers in North America," BMO Bank of Montreal president
and chief executive officer (personal and commercial banking)
Frank Techar said.
In total, the agreement represents net receivables of
almost USD 1 billion and about USD 7.8 billion in card
transactions, BMO added.