Citigroup to extricate itself completely from new sub-prime lending in Britain, with the loss of up to 700 jobs.
The American bank is closing down Future Mortgages, its mortgage operation, and CitiFinancial, its unsecured loans business.
Its 92,000 mostly sub-prime customers – people with blemished credit histories – will continue to be serviced by other parts of Citigroup on the same terms.
The bank said that it planned to close its Doxford call centre operation near Sunderland, where 400 people are employed, and 49 CitiFinancial branches, employing 300 people. The bank has entered into consultation with the staff affected. Some may be offered jobs elsewhere in the group.
Citi said it acquired the businesses in 2000 and 2001 and that it started to wind down new loans to sub-prime customers three years ago.
Future Mortgages specialised in providing first and second mortgages to sub-prime borrowers applying through brokers and other intermediaries. CitiFinancial, the bank’s main sub-prime brand, provided unsecured loans again to borrowers introduced through intermediaries.
Bert Pijls, business manager for Citigroup’s British consumer business, said that after a strategic review, the two operations had not been identified as areas for growth. Instead, Citigroup would focus its firepower through its Citi and Egg brands.