Markets
BAC

Citigroup News: Sells $3 Billion Stake in China Guangfa Bank, Receives Subpoena in FIFA Probe

Selling $3 billion Guangfa Bank Stake

On Monday, news broke that Citigroup Inc C reached a deal to sell its $3 billion stake in China Guangfa Bank to China Life Insurance Co, The Wall Street Journalreports .

Citigroup originally purchased its holding in Guangfa Bank back in 2006 for about $6Array0 million; the financial company believes its 20% stake no longer fits with its strategic plans for China, where it manages its own branch network. Citigroup will offload its stake by premiums.

"This transaction is consistent with the simplification of Citi and allows us to focus our resources in China on growing our core franchise further," Citigroup's Asia Pacific Chief Executive Francisco Aristeguieta said in a statement.

The deal is expected to close in the latter half of this year, and it will not have a material impact on Citigroup's upcoming earnings report in April.

FIFA Subpoena

According to a securities filing, Citigroup said that it has received a subpoena in connection with the FIFA bribery scandal. It is the first major U.S. bank to disclose a connection to probes involving international soccer's governing entity.

According to CNN Money , "senior FIFA officials used various U.S. banks -- including Citi, JPMorgan Chase JPM and Bank of America BAC -- to transfer and receive $Array50 million in bribes and kickbacks, authorities alleged last year."

"Citi said officials have requested information related to "banking relationships and transactions" tied to individuals "identified as having had involvement" in the alleged corrupt conduct. In other words, authorities are questioning whether Citi turned a blind eye to suspicious transactions allegedly made by FIFA officials," CNN Money continues.

Citi said it is "cooperating" with authorities on the subpoena, which came from the U.S. Attorney for the Eastern District in New York.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days . Click to get this free report >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

JPMORGAN CHASE (JPM): Free Stock Analysis Report

CITIGROUP INC (C): Free Stock Analysis Report

BANK OF AMER CP (BAC): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

BAC JPM C

Other Topics

Stocks

Latest Markets Videos