Citibank Brazil and Banco Itau Come to Agreement on Credicard

Wednesday 2 February 2005 17:25 CET | News

Citibank Brazil and Banco Itau have agreed to divide equally the assets of Credicard, without any financial consideration paid by either party. As a result of this agreement, which follows the banks previous announcement in November 2004 regarding Credicard, Citibank Brazil will add more than 3.8 million cards, bringing Citibanks total number of Brazilian credit cards to approximately 4.7 million. The completion of this transaction is subject to regulatory approvals.

For now, all Credicard cardholders will be able to continue using their cards just as they have, and there are no changes to the terms, conditions or characteristics of their credit cards. Customers and vendors will be notified of specific transition plans well in advance. Both banks are strongly committed to working together closely to ensure that Credicard customers continue to receive the same high level of service to which they are accustomed. After the transition is complete, which is expected to occur later in 2005, Citibank Brazil and Banco Itau will manage their respective credit card operations in the manner that best supports each companys distinct business strategies. This agreement enhances our leading international credit cards position, making Brazil Citis 2nd largest international cards market after South Korea. It is a great opportunity for us to leverage our global expertise in credit cards in order to provide our clients in Brazil with leading products and innovative features, said Marge Magner, Chairman and CEO of Citigroups Global Consumer Group. In addition to credit cards, Citibank Brazils consumer finance products and services include expert and highly personalized banking and wealth management delivered through 44 Citibank branches; the convenience of 150 ATMs; CitiFinancial personal loans, featuring the option for repayment through payroll deduction; and a complete line of insurance protection through Citibank Corretora de Seguros. The announcement is a result of the parties strategic review, which concluded that Brazils vibrant credit card market environment can support competitive structures, enabling customers to benefit from greater choices and innovation. In November 2004, Citibank Brazil, Banco Itau and Unibanco announced the restructuring of the ownership of their jointly owned Credicard Group, including the purchase by Citibank and Itau of Unibancos interest in the Credicard card issuing business, and the purchase by Itau of Citibanks and Unibancos shares in Orbitall, the card processing and servicing business. Redecard, the merchant acquiring business, maintained its ownership structure, with Citibank, Itau and Unibanco each owning 32 percent, and MasterCard owning 4 percent.

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Categories: Payments & Commerce | Payments General
Countries: World
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Payments & Commerce