Citigroup to Buy Out Cuscatlán for $1.5 Billion
The largest financial conglomerate in the world, Citigroup, in December announced plans for a $1.5 billion buyout of Corporacion UBC Internacional S.A.’s 53 Grupo Cuscatlán subsidiaries.
The buyout comes two months after Citigroup announced plans to buy out Grupo Financiero Uno, the largest credit
card issuer in Central America, according to a Citigroup news release.
A leading financial group in Central America, Grupo Cuscatlán has more than 45,000 corporate clients, 1.2 million consumer clients through a distribution network of 202 branches, 263 ATMs and about 5,000 employees in El Salvador, Guatemala, Costa Rica, Honduras and Panama. The group says it has $5.4 billion in assets, $3.5 billion in loans and $3.4 billion in deposits as of Sept. 30, 2006.
The purchase of Cuscatlán, which must be approved by the regulating authorities in each country, is anticipated early this year.
Citigroup is the leading global financial services company with some 200 million customer accounts and operations in more than 100 countries. It has more than 2,200 branches in Latin America. Recently it announced the acquisition of Grupo Financiero Uno, which has more than one million retail clients, more than 75 branches and 100 mini branches and points of sale. That transaction is still pending regulatory approvals.
Citigroup is the fourth multinational banking giant to step into Central America since 2005. In April 2005, GE Money bought out half of Grupo BAC’s stocks that were unofficially worth about $500 million, the business weekly El Financiero reported.
Last June, Scotiabank announced plans to buy out Corporacion Interfín for $293 million (TT, June 16, 2006). A month later HSBC bought out Banistmo for $1.7 billion.
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