In a statement released on December 29, Citigroup said that the transfer of Citibank Russia to Renaissance Capital of Russia is expected to cause this bank to suffer a pre-tax loss of about 1.2 billion USD.
This is a figure much higher than the initial estimate when Citigroup announced its plan to withdraw from Russia in 2022.
The US bank began the process of narrowing and withdrawing from Russia in August 2022, amid a wave of Western businesses fleeing this market after Moscow faced sanctions related to the Ukraine conflict.
At that time, Citibank Russia's total assets (AO Citibank) were about 10 billion USD and the withdrawal cost was estimated at only about 170 million USD.
However, reality has become much more complicated and costly. In December 2022, Citigroup sold its ruble consumer loan portfolio to Russia's Uralsib bank. The remaining operation took several more years to complete legal procedures and apply for approval from both Russia and the US.
According to Citigroup, the large loss arising mainly relates to the adjustment of exchange rate differences (CTA). This is a accounting method that reflects profits or losses when converting the financial statements of a subsidiary abroad, using the domestic currency, to the reported currency of the parent company.
The bank said that these CTA losses will continue to be recorded in the "other comprehensive income" section until the deal is officially completed.
Citigroup also warned that the loss figure may fluctuate further, depending on exchange rate developments in the coming time. From the fourth quarter of 2025, the remaining banking activities in Russia will be classified as "holding for sale".
The deal could only take another important step last month, when Russian President Vladimir Putin signed a decision allowing Renaissance Capital to acquire Citigroup's operations in Russia.
According to documents submitted to the US Securities and Exchange Commission (SEC), the two sides expect the transaction to be completed in the first half of 2026.
The loss of more than 1 billion USD shows that the real price that Western banks and financial groups have to pay when withdrawing from Russia is not only about selling assets, but also includes prolonged losses due to currency fluctuations, legal procedures and political barriers.
With Citigroup, this deal marks a costly end to one of the bank's most difficult strategic decisions in the past decade.
