Citigroup Inc. said Thursday that its previously announced plans to scale back its consumer banking operation in Russia will cost about $170 million, mostly over the next 18 months.
Citigroup C, +1.99% is also actively pursuing sales of Russian consumer banking portfolios as it scales down its deposits, investments, loans and cards in the country.
The megabank said the Russia wind-down is expected to affect about 2,300 employees and 15 branches.
The $170 million in costs will cover restructuring, vendor termination fees and other related charges.
Citi’s move to exit Russia comes as banks scale back their Russia business in the wake of the country’s invasion of Ukraine.
Citi initially announced its plan to exit Russia consumer banking in April, 2021 as part of its plans to shutter consumer franchises in 14 markets in Asia, Europe, Middle East and Africa, and Mexico.
In March this year, Citi expanded the scope of its planned exit in Russia to include local commercial banking.
Citi reiterated its plan to support multinational institutional clients, particularly those which are undergoing the complex task of winding down their operations in Russia.
Citi’s CEO of Europe, Middle East and Africa David Livingstone said Citi’s Russia scale-back comes along with moves to limit its service offering, reduce its exposures and not solicit any new business or clients.
Citi disclosed $8.4 billion in Russia exposure as of June 30, down from $9.8 billion at the end of 2021 year-end. About $1 billion of that exposure is related to Citigroup’s consumer and local commercial banking businesses in Russia.
Shares of Citigroup rose 1.5% on Thursday. The stock is down 14.3% in 2022, compared to a 12.4% drop by the S&P 500 SPX, +0.57%.