Citigroup CEO, Vikram Pandit, has a tough task at hand. His ambitious plans to script the mega turnaround story for Citigroup will come by selling assets worth a whopping $400 billion.
Its consumer finance unit in Germany has gone to France based Credit Mutuel Group for $ 7.7 billon in an all cash deal.
“This is another strategic step in our effort to reorganize Citi, strengthen our balance sheet and put us squarely on the path to future growth driven by our core business,'' said Vikram Pandit, CEO, Citigroup.
Credit Mutuel is France's second biggest bank by branches. While Citi closed a deal in Germany, GE after its lacklustre performance in the last quarter also sold off its consumer lending operations for $5.4 billion to Japan's Shinsei Bank.
For the second quarter GE saw its net income dip by 5.8 per cent.
So the decision to exit Japan business is a part of the larger strategy to trim underperforming assets in GE Money.
In addition, GE is also planning to sell of its $30 billion credit card business.
The latest subprime crisis has forced a lot of financial institutions to sell off their under performing assets. Management of these company say that this is just the beginning and the long and painful journey to recovery has just begun.