Citibank is Selling Auto Loan Portfolio

 
The auto loan portfolio of the mega bank Citigroup, Inc.  is up for sale. The financial institution has decided to sell it to Santander, which is easily one of the largest banks in Spain. The auto loan portfolio is worth roughly $3.2 billion. The bank is also going to service another auto loan portfolio that the company owns that is worth $7.2 billion. The terms of the deal are not being publically released although many in the field believe that it must be fairly lucrative or Citi bank would not be looking to offer the portfolios.
 
Santander did say that they were paying 99% of the value of the gross receivables in the auto loan portfolio that it was purchasing. The deal between the two companies is expected to close within the third quarter of this year. Allegedly Citgroup was planning on selling the entire auto loan portfolio as they supposedly had somewhere around $16 billion in loans. However, some said that they could not get a buyer for that amount of money and so they chose to split it into two groups instead. This way they get the cash from selling part of it, but they also still receive some income from the auto loans that they kept.
 
Citigroups shares went up with the talk of the auto loan deal, and Santanders did as well. Citigroup went up 1.1%, which brought them up to $3.82 a share, while the other company saw an increase of three cents up to $10.90 a share.

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