Citigroup said on Monday that its board has approved the sale of its Russian subsidiary to Renaissance Capital, a move expected to result in an estimated $1.2 billion pre-tax loss, largely driven by currency fluctuations, as the US bank continues its exit from the Russian market amid ongoing geopolitical tensions.
Divestment details
The transaction involves AO Citibank, which oversees Citigroup’s remaining operations in Russia, and is expected to close in the first half of 2026, subject to regulatory approvals and other customary conditions, according to a regulatory filing.
Citigroup said it has secured the internal approvals required to proceed with the sale of AO Citibank to Renaissance Capital. The bank noted that the deal will result in a pre-tax loss recognized in the fourth quarter of 2025, primarily related to currency translation adjustment losses. These losses will remain recorded in accumulated other comprehensive income until the transaction is completed.
Currency translation adjustments reflect gains or losses arising from the conversion of foreign subsidiaries’ financial statements into the parent company’s reporting currency, while accumulated other comprehensive income captures unrealized balance sheet items outside of net income.
Citigroup said the currency-related impact will not affect its common equity tier 1 capital ratio. Upon completion of the divestment, the transaction is expected to strengthen CET1 capital by removing associated risk-weighted assets from the bank’s balance sheet.
The bank cautioned that the final loss could change due to factors such as exchange rate movements. It also plans to classify its remaining Russian operations as “held for sale” beginning in the fourth quarter of 2025.
Key background
The sale follows approval last month from Russian President Vladimir Putin allowing Renaissance Capital to acquire Citigroup’s local banking operations.
Citigroup first announced plans to exit Russia in August 2022, scaling back its consumer and commercial banking presence as part of broader efforts to reduce exposure following Russia’s invasion of Ukraine.
Market capitalization
Citigroup’s market value stood at approximately $211.4 billion as of Tuesday.
