Citigroup has no plans to exit its consumer finance business in India, where defaults have risen, the head of its Indian unit said on Thursday.
"We are only repositioning and resegmenting the products. Consumer finance is important for India," Sanjay Nayar, chief executive at Citi India, said on the sidelines of a news conference.
Earlier this month, a leading newspaper reported Citigroup had approached several banks to sell its vehicle and construction equipment loans in India because of a drop in margins and a sharp rise in loan defaults.
Nayar said non-performing assets in the consumer finance segment were much larger than expected, but declined to give details.
"It is classic over indebtedness, consumers were overleveraged, while the underlying capacity remained unchanged," he said.
However, the returns from Citi's Indian business were "satisfactory", he said, without elaborating.
Nayar also said Citibank India had raised about $500 million in an infrastructure fund with Infrastructure Development Finance Co Ltd.
Source: The Financial Express