Axis Bank hopes to complete the acquisition of Citibank’s retail division by 1 March 2023. However, in the situation that the lender stumbles into problems with technology, the procedure may extend beyond May, according to Amitabh Choudhary, MD and CEO of Axis Bank. The private sector lender revealed in March that it would purchase Citibank India’s retail business for Rs 12,325 crore. Credit cards, retail banking, wealth management, and consumer loans are all part of the retail business. After the deal is done, Axis Bank will need 18 months to effectively take control of Citibank’s client base and technology.
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While speaking to the reporters during a business event in Mumbai, Choudhary explained, “We are still working extremely hard to complete the deal before 1 March. We need to resolve a few IT concerns, and we’re keeping the RBI informed as we do so. People from Citibank are currently being informed about the positions they will hold at Axis, so that process has also begun.”
However, Choudhary confirmed that there is no legal issue delaying the merger and it’s only because of IT-related problems. “Several modest technological adjustments will be made, and most of these should be executed between January and February. In the occasion of a delay, we can choose to postpone it till May,” he further added.
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After the merger is complete, Axis Bank will have approximately 10.6 million active cards and 28.5 million active savings accounts. There will likely be a 2.5 million card boost in the bank’s credit card user base. According to the most recent RBI data, the lender had 9.09 million credit cards as of October.
The biggest market for credit cards is held by Axis’ sectoral rival HDFC Bank, followed by SBI and ICICI Bank. As per a survey by Macquire Research, HDFC Bank’s market share in card spending actually recovered by 250 basis points in October after experiencing a significant loss the previous month. This improvement was driven by excellent festive offers and benefits.
