Citi will take a roughly $1.2 billion pre-tax loss in 2025’s fourth quarter connected to the sale of its remaining operations in Russia, the bank disclosed last week.
The loss on the sale to Russian investment bank Renaissance Capital amounts to $1.6 billion, Citi said in a filing Dec. 29. But that total will be offset by $200 million in expected proceeds from the transaction and another estimated $200 million from derecognition of Citi’s fully reserved net investment.
“While any substantial loss is unfortunate, we believe investors will look past it as a non-core item and focus more on the idea that resolution of another legacy issue is getting closer to the finish line,” Scott Siefers, a managing director and senior research analyst at Piper Sandler, wrote in a Dec. 30 note seen by Banking Dive. Siefers called the development “a positive for [Citi’s] ongoing transformation.”
Citi will reclassify its remaining Russia business as “held for sale” – rather than reporting it as legacy assets, the bank said. Citi’s board of directors approved the sale Dec. 29 and anticipates the deal will close in the first half of 2026, the bank disclosed.
That sign-off comes about a month and a half after Russian President Vladimir Putin signaled he would allow the sale.
Citi had roughly $1.8 billion of exposure to Russia as of Sept. 30, JPMorgan analysts wrote Dec. 30. That’s far less than the $9.8 billion the bank counted around the time Russia invaded Ukraine in 2022. Citi included Russia among 13 foreign retail-banking markets from which it sought to extricate itself in early 2021. Citi in August 2022 announced a plan to wind down its Russia consumer-banking operations. That move was estimated to cost the bank $170 million.
The loss on Citi’s sale to RenCap stems from currency translation adjustment, an accounting method that captures gains or losses from converting a foreign subsidiary's financial statements from local currency to the parent company's reporting currency.
The cumulative impact of the loss will be neutral to Citi’s common equity tier 1 capital, the bank said.
