Here’s a trend that’s picking up steam. After expanding aggressively into China over the past several years, Western banks are retreating, opting to conserve cash rather than invest in the future growth of the company.
Citigroup (C), which is restructuring and retrenching all around the globe is pulling the plug on its private banking unit:
Reuters: Citigroup Inc will close its private banking unit in China, which targeted the country’s growing ranks of millionaires, and fold the operations into its consumer banking arm as it streamlines its businesses, sources familiar with the situation said on Tuesday.
The indication from Citi is that it will still offer private banking services, but only as part of its retail operations. Perhaps the country’s “growing ranks of millionaires” isn’t growing quite as fast as they thought.
RBS, meanwhile, is sellings its stake in the Bank of China:
Royal Bank of Scotland Group PLC (RBS) may start selling its stake in Bank of China Ltd. (3988.HK) Tuesday, a person familiar with the matter told Dow Jones Newswires.
It was unclear whether RBS has lined up one or multiple buyers for the 4.3% stake which it bought in 2005 for GBP900 million.
The moves follow on Bank of America’s (BAC) recent decision to sell its stake in the China Construction Bank for $2.8 Billion.