Citigroup sells stake in Turkey's Akbank for $1.2 billion
By David Dolan
ISTANBUL (Reuters) - Citigroup (C.N: Quote) has sold its nearly 10 percent stake in Turkey's Akbank (AKBNK.IS: Quote) for $1.2 billion, the U.S. lender said on Thursday, its latest disposal of overseas assets to cut costs and boost capital.
New York-based Citi has pared back internationally in recent years, pulling out of retail banking in Turkey and in long-established markets such as Japan.
Citi, which had been the second-largest shareholder in Akbank, said the sale would not have a material impact on its finances. Akbank is Turkey's fourth-largest listed lender by assets.
The U.S. bank did not disclose the buyer. Akbank's top shareholder, industrial conglomerate Sabanci Holdings SAHOL.IS, said it had waived its right of refusal to the stake, adding Citi's offer had been to a "large number" of potential buyers.
Citi said it remained committed to Turkey, where it aims to increase corporate and commercial lending and employs more than 500 people.
Still, the sale comes at an inopportune time for Turkish banking, as overseas investors worry about increased political interference in the industry.
Ratings agency Standard & Poor's warned on Wednesday that regulatory actions against an Islamic lender, Bank Asya, illustrated the "potential for political risk, or the perception of it, to directly or indirectly spill over into the financial system".
Bank Asya, founded by followers of U.S.-based Islamic cleric Fethullah Gulen, is at the heart of a power struggle between Gulen and President Tayyip Erdogan, who accuses the religious leader of attempting to build a "parallel state". Continued...