Citi Private Bank to Sell Portion of U.S. Trust Business to Reliance Financial

Northern, WI 1/24/2013 (avauncer) - Citi Private Bank, the private arm of Citigroup Inc.(NYSE:C) has accepted to sell a part of its U.S. trust business to Reliance Financial Corp. a privately managed trust so as to lower its non-core holdings.

The financial aspect of the transaction was not informed.

As per the terms of the deal, Reliance Financial will buy the complete stock of Citigroup Trust-Delaware, N.A. This buyout comprises of about 3,000 accounts, worth of $1.7 billion assets under management.

Citi Private Bank provides financial products and services to rich individuals as well as families and says the business is a part of a non-target sector.

Paul James, CEO of of Citi Private Bank’s trust business said, “We are pleased to have reached this agreement with Reliance Trust Company which will enable them to take over the management of this portion of our business in North America. Citi Trust in North America remains focused on providing its full suite of trust and estate services to the high net worth and ultra high net worth clients of Citi Private Bank through our Delaware, New York and South Dakota centers.”

Michael Roberts, president of Reliance Trust Company, said the deal will help the firm become bigger in terms of size, scale and general nationwide presence in the business of personal trust.

With the deal, Reliance Financial’s market share increased and is in alignment with its concentration on the institutional sector, stated James T. Maxwell.

Citigroup said previously during this month that its profit for 4^th quarter increased by over 25%, but did not meet investor expectations due legal expenses incurred in the U.S. consumer business impacted profits. The banking mammoth is in the middle of changes, announced by new Chief Executive Michael Corbat, who had stated plans to trim jobs, shut down branches and exit from consumer banking in some countries so as to lower expenses.

Citigroup Inc.(NYSE:C) shares were up by 0.57% closing at $42.02. The stock has gone up by 66% during the last 6 months.