Citigroup to sell trust banking unit in Japan: reports

Citigroup to sell trust banking unit in Japan: reports

Tokyo: US banking giant Citigroup, beset by the global financial turmoil, has decided to sell its Japanese trust banking unit NikkoCiti Trust and Banking, reports said today.

The bidding will likely take place next week, with major domestic trust banks including Mitsubishi UFJ Trust and Banking and Sumitomo Trust & Banking expected to make bids for the firm, the business daily Nikkei and Kyodo News reported, citing unnamed sources.

Kyodo News reported that the sale could amount to ‘tens of billions’ of yen.

Nikkociti’s total net assets stood at ¥18 billion ($190 million) as of the end of September.

The reports came after the US government in late November stepped in to guarantee over $300 billion in potential losses at Citigroup and pump $20 billion more into the financial giant.

Nikko Cordial Securities, a major Japanese securities house also under the umbrella of Citigroup, has also decided to trim jobs through calls for early retirements, the reports said.

Despite the subprime housing loan crisis which emerged earlier this year, Citigroup has pressed ahead with expansion into the Japanese market, this year taking full control of brokerage house Nikko Cordial Corp in a $4.8 billion share swap.

But in February it announced it was selling its Tokyo headquarters to its rival Morgan Stanley in a deal reported to be worth ¥48 billion ($455 million).