20/01/2008
| Citigroup, apart from grappling with the write-offs and losses in its consumer banking business in the US, will also have to get its act right in other markets as well, particularly, India and Mexico. |
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| Chief Executive Officer Vikram Pandit, in his statement on the largest global financial services group’s 2007 earnings, said, “Net income (in the international consumer finance business) declined as revenue growth was offset by an increase in net credit losses due to portfolio growth and an increase in the net credit loss ratio in India and Mexico. Higher credit costs also reflected the impact of repositioning the UK business.” |
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| The net credit loss ratio increased 86 basis points to 3.78 per cent during the year, he said. |
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| In India, the rising instances of loan defaults in the small-ticket loan segments has forced the bank to tighten its lending norms. |
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| The bank’s provisions and write-offs on its consumer banking portfolio in India has seen a rise of 182 per cent to Rs 503.9 crore for the year ended March 31, 2007 from Rs 178.5 crore a year earlier. |
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| Its consumer banking portfolio in India shrunk to Rs 17,562 crore as on March 31, 2007 from Rs 17,707 crore a year earlier. Taking note of the rising credit losses, Citigroup has begun spending more time in interactions with every prospective customer to understand needs and repayment capacity. |
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