Citi and Argentina have been like passionate lovers, alternately fighting and embracing. Although recently booted from the country, the bank is leaving an open line of credit for its customers. 

Author: Gordon Platt

On a visit to Argentina in August, Citi CEO Michael Corbat met with the country’s pro-market president, Mauricio Macri, and announced a $3.5 billion line of credit for the bank’s 1,300 corporate and institutional clients in the country.

He also felt obliged to explain why Citi is abandoning Argentina’s retail banking scene after 102 years.

“This does not mean that Citi leaves the country, but just the other way around,” Corbat said. “It means that we will guide our efforts where we are more competitive because we want to grow in Argentina.”

Citi was a joint bookrunner in April for Argentina’s $16.5 billion bond issue, the first since the country’s 2001 default. Some $9.3 billion of the proceeds will be used to pay a group of holdout creditors, including four US hedge funds.

The government of Macri’s leftist predecessor, Cristina Fernández, sued Citi in local courts last year for making a deal with the holdout US creditors, whom she called “vultures.” Citi shut down its custody business in Argentina after a US federal court blocked it from making interest payments on the debt. Argentina then suspended Citi from capital market operations and stripped its local CEO of his authority.   

Times have changed. 


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