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* U.S. bank plans several new offices, hiring spree
* Sees rivals pulling back from lending to mid-sized firms
* Reports rising demand for services from digital clients
By Sinead Cruise and Lawrence White
LONDON, June 4 (Reuters) - Citigroup is looking to
ramp up its commercial banking operations across Europe, Middle
East and Africa, plugging gaps left by rivals facing fallout
from a coronavirus-induced recession.
The U.S. bank plans to expand its business lending division
catering to companies with annual turnover between $25 million
and $2.5 billion with a slew of new hires and office launches in
several Western European countries by the end of 2020.
Competitors, including HSBC and Standard Chartered
, have made similar bids to win business from small and
mid-sized European companies in the past few years, hoping to
increase revenues in a market traditionally dominated by local
banks.
"If you look at European banks right now, many are
refocusing as national champions, selling off or reducing
marginal overseas businesses where they didn't have scale," said
Ray Gatcliffe, Head of Citi Commercial Bank for Europe, Middle
East and Africa (EMEA).
The time is right to expand despite fears of credit losses
caused by the pandemic, Gatcliffe said, as rivals pare lending
to smaller, fast-growing companies which find they need a global
bank when liquidity is being used up by domestic or blue chip
clients.
While Citi as a whole operates in 55 countries in EMEA, its
commercial banking unit - which has around 5,000 clients in the
region - only has offices in 15 with another 21 countries served
from hubs such as Dublin, Dubai and London.
The 15 offices are predominantly in central and eastern
Europe including Poland, Turkey and Russia.
Gatcliffe declined to specify where Citi will expand first
but said he wanted to add to the unit's 500-strong EMEA team
with a minimum of 10-20 hires for each new office.
"A lot of companies in EMEA have been impacted by their
banks reducing global and even regional footprints. We've kept
our global network and think that will resonate with clients
seeking to expand internationally," Gatcliffe said.
"It's not an inexpensive proposition to have local banking
licences across the globe as we do. There are important
opportunities and obligations attached to having such a broad
geographical footprint."
The launch of Citi's UK commercial banking business in 2017
has also provided a blueprint for expansion elsewhere, he added.
Last year, that business contributed 21% of EMEA revenues.
Citi is particularly targeting fintech companies which often
require cross-border services.
In 2019, the bank expanded its Digital Client business to 16
Western European markets including Germany, Spain and the
Nordics.
These markets are currently served by digital hubs in
London, Dublin and Tel Aviv.
(Editing by Jane Merriman)
