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Axis Bank leads race for Citi’s India retail business

News: Axis Bank has emerged as the frontrunner to buy Citi’s consumer business in India. Axis and Citi have signed an exclusivity agreement to hold bilateral negotiations. Citi has been expecting ~Rs.15000 crore ($2 billion) from the sale. The final valuation will be linked to the number of variables including the quantum of deposits, customers, partners, quantum of assets and liabilities move from one franchise to another once all regulatory clearances come through, according to The Economic Times.

Views: We believe Citi’s acquisition will strengthen Axis Bank’s high-end credit card business and mortgage business. Further, the acquisition of Citi’s India retail business would further help Axis Bank to expand their reach and create more opportunities.

Impact: Positive.