Citigroup to spin off Banamex, its longtime Mexican banking business

A Banamex bank sign sits front of the bank's headquarters in Mexico City, Monday, Feb 16, 2009. Citigroup plans to spin off its Banamex banking franchise, the company said Wednesday, May 24, 2023, a deal that would bring an end to Citi’s two-decade push into Latin America. (AP Photo/Gregory Bull, File)

NEW YORK (AP) — Citigroup plans to spin off its Banamex banking franchise, the company said Wednesday, a deal that would bring an end to Citi's two-decade push into Latin America.

Citi had announced last year that it planned to explore options for the Banamex business, which included a possible sale of the company to a rival bank or a major investor. Under CEO Jane Fraser, Citi has been looking to simplify its business and pull out of 14 international markets where the bank does not have scale or significant operations.

But Banamex, or Banco Nacional de Mexico, is not a small part of Citi's business. Since buying the company in 2001, Citi has grown Banamex to Mexico's fourth-largest banking company, with 1,300 branches and 13 million customers. Banamex employs roughly 38,000 workers in the country.

Since announcing its plans for Banamex last year, any deal has come with significant political complications. Mexican politicians had pushed for job guarantees and there were fears that Citi would move Banamex's substantial Mexican art collection out of the country. In a statement, Citi said all Banamex art and historic buildings will remain part of the new company.

Citi expects Banamex to separate the two businesses by the end of 2024 and the newly separated company will go public sometime in 2025.