Citibank believes it is not worth paying the high prices on the Romanian banking market to expand by an acquisition , so that, at least for now, it will continue to invest in organic growth of its domestic operations, Shahmir Khaliq, 36, Citibank Romania president, told ZIARUL FINANCIAR.
"In the absence of valid targets in terms of price compared against the economic value of the entities in question, we believe it is more efficient to invest in organic growth. We don't like minority interests, either," Khaliq says.
Present on the market for ten years, Citibank is trying to adapt to the changes induced by the move of the banks specialising in retail. Focusing on services for corporate customers, the local branch of world's largest banking group, has been witnessing constant decline of its market share in terms of assets after 2000, ending up 12th in the bank ranking at the end of first quarter of 2006, with a market share of only 1.9% corresponding to 729 million euros in assets.
"We were not aggressive on the consumer finance segment, while others were and made half of the growth of the market come from this area," Shahmir Khaliq says, explaining Citibank's decline in the bank ranking by assets.
He says the bank has been applying a strategy to adjust to the developments on the market since July 2005, investing in the growth of the sales network of CitiFinancial, the consumer finance division of Citibank. At the same time, a large part of the bank funding granted over the last few years has gone to the real estate sector, but Citigroup has a different policy in this regard. "We finance the real estate sector through special funds. We do not grant traditional loans through the bank," Khaliq stated.
He also says that Citigroup's total exposure in Romania amounts to about 1.5 billion dollars, with half of the funding registered abroad.
Despite the decline in market share in terms of assets, the local operations remained profitable.
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