US banking giant Citigroup is buying a 5 per cent stake in Shanghai Pudong Development Bank, Bloomberg reported. Citibank Overseas Investment Corp will pay Yn600m for the stake, or Yn3.32 a share, and buy another 1.7 per cent from Shanghai Jinqiao Export Processing Zone Development Co, as part of its parent's plan to take a 10 per cent stake in the bank. The Chinese bank said that Citigroup would help it expand its credit card service, and would transfer product and technical expertise. Separately, Citicorp Leasing International would provide Citigroup's brand and technical expertise to help Pudong offer personal finance services to customers. The purchase has been approved by China's banking authorities. Pudong Development Bank failed to sell about 15 per cent of the 300m new shares it offered to domestic investors, according to the arranger, China Everbright Securities. Pudong had offered the shares at Yn8.45, which investors complained was much higher than that paid by Citigroup for its stake. Pudong raised Yn2.54bn from the sale, about half the Yn5bn it had hoped to raise.
Citigroup has signed a deal to move its China headquarters to a new building in the centre of Shanghai's Lujiazui district, China Daily reported. The building, which is expected to be completed in 2005, is to be named Citigroup Tower. The bank will take four floors in the building and have a Citibank retail outlet on the ground floor.