Citigroup’s plan to spin off its Mexican subsidiary Banamex through an initial public offering (IPO) is sparking fears of political backlash.
There’s growing concerns that the move could lead to job cuts and the loss of millions of dollars in art collections stored in the bank’s vaults.
With more than 13 million customers and 38,000 employees, Banamex (which Citi acquired in 2001) is one of the largest banks in Mexico. Its art collection, which includes works by Frida Kahlo, Diego Rivera and Rufino Tamayo, is among the most valued in Latin America.
The Mexican government said that it will review the terms of the IPO to ensure that it is in the best interests of Mexican workers and the country’s cultural heritage.
Citigroup is doing everything it can to allay concerns. In a statement this week, the multinational said that all of Banamex’s artistic and historic buildings will remain in the hands of the new company, adding that it will work with the Mexican government to ensure that job losses are minimized.
Banamex was Mexico’s largest lender at the time of the 2001 takeover. The bank currently has over 1,300 branches and more than 9,000 ATMs nationwide.
Citigroup’s business in Mexico is organized into two major divisions: Consumer Banking and Corporate and Investment Banking. Consumer Banking offers a wide range of financial services, including savings, credit cards, loans and mortgages. Corporate and Investment Banking provides financial services, including investment banking, asset management and treasury.