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Arguably Citigroup’s most diverse region, CEEMEA encompasses central and eastern Europe, the Middle East and Africa and Turkey. The region is broken into five divisions: Russia/CIS; central and eastern Europe (though Poland, where Citigroup owns Bank Handlowy is separate); Africa (meaning sub-Saharan Africa down to South Africa); the Middle East and north Africa; and Turkey and Israel.
The bank has executed a number of successful transactions in recent years, including several for Polish telecom TPSA. The bank is also strong in the Middle East – a region that is unique, according to Shirish Apte, chief executive for CEEMEA within the corporate and investment bank.
| Shirish Apte: late to start in equities, but trying to play catch-up |
“By and large, the other developing regions are absorbers of investment capital. The Middle East is both an absorber and a generator of investment capital,” he says. This is creating opportunities in project finance, M&A advisory, acquisition finance, as well as the capital markets. Citigroup, for example, advised CSX Corporation in the $1.5 billion sale of its international terminal business to Dubai Ports International.
In the increasingly important area of Islamic finance, the bank is well positioned through its Citi Islamic Investment Bank in Bahrain. Citigroup was the first international institution to set up a separately capitalized Islamic bank. The bank is run by Mohsin Nathani, who reports to Apte. Citigroup has introduced various new Islamic asset classes, including Islamic capital protected equity linked notes and Islamic credit derivatives products.
The one area where Citigroup is weak in CEEMEA is equities, says Apte. “We were late starters,” he admits. “We are playing some catch-up but we are getting there quickly.” However, the bank was not even ranked in the top 10 bookrunners for international equity deals out of central and eastern Europe last year, according to Dealogic. One interesting development to keep an eye out for is whether Citigroup will buy in Russia. So far, the bank has resisted the temptation but with rivals, such as Deutsche Bank and Dresdner Kleinwort Wasserstein, investing in local banks, it might be forced to follow suit.
