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Australia's NAB fields questions over potential purchase of Citi's local consumer unit

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Paulina Duran
·2 min read
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By Paulina Duran

SYDNEY (Reuters) - National Australia Bank (NAB) on Friday declined to rule out buying the local consumer finance and credit card operations of Citigroup Inc, which unveiled plans to exit some businesses in Asia and Europe overnight.

Citi, the fifth-largest provider of credit cards in Australia behind NAB and the country's other three major lenders, on Thursday said it would exit retail banking in Australia, Korea and 11 other markets across Asia and Europe.

Facing questions at a parliamentary committee about the high concentration of Australia's banking system and whether NAB would be interested in a deal with Citi, NAB Chief Executive Officer Ross McEwan declined to rule out or comment on any specific transaction.

"Our strategy today is to grow through our own activities but you know, every business, be it a bank or anybody else would look at areas that might add to the customer services and make it more efficient," he said.

The questioning follows NAB's agreement in January to purchase Australia's largest digital-only retail lender, 86 400, for A$220 million ($170.1 million).

NAB is Australia's third-largest lender by assets, putting it among the so-called Big Four banks that dominate most commercial banking products including home loans, credit cards and business finance.

NAB, Commonwealth Bank, Westpac Banking Corp and Australia and New Zealand Banking Group account for over 75% of the county's A$2.85 trillion in banking assets, official data shows.

Accounting for 3.5% of its global consumer finance business, Citi had $9.3 billion in loans in Australia, a figure that had shrunk 12% in the past year, it said on Thursday.

The U.S. lender had already received approaches from a number of unnamed parties to buy the Australian unit, which operates credit cards, mortgages, and wealth management, Citi said.

($1 = 1.2942 Australian dollars)

(Reporting by Paulina Duran in Sydney; Editing by Stephen Coates)