Citigroup bets on emerging markets for future growth

US financial group Citigroup is looking to big emerging markets, such as Brazil, to underpin its recovery and drive future growth, said Chief Executive Vikram Pandit. Speaking to reporters at the bank's Brazilian headquarters in Sao Paulo, Pandit said Brazil is shaping up as a key area of growth for Citigroup, now the third-largest US bank after losing billions of dollars in the credit crisis. "When you look at all of Citicorp [its operating unit] we are going to be half emer-ging markets," he said. He did not give a timetable. "We will be playing the two growth themes very clearly. One is globalisation and the second is the growth in emerging markets," said Pandit. "We are convinced that emerging markets will decouple from developed markets." Brazil, Latin America's largest economy, has been a bright spot for Citigroup in recent years, offering a steady source of revenue during the country's biggest economic boom in three decades. Pandit said Citigroup intends to increasingly focus on consumer finance in Brazil, a strategy other banks are also pursuing as more Brazilians and small- and medium-sized companies look to take advantage of a stable economy to borrow money to invest. Unlike other large emerging markets or developed countries that depend on exports for growth, Brazil's economy is largely driven by domestic demand, which should help the country weather the global turmoil better, Pandit said. "The unsung hero of Brazil is the Brazilian consumer," he said. "The development model for Brazil is going to be robust. It's not only about commodities, it's not only about exports, but it's about developing a domestic economy, domestic consumption and that's happening." The bank is betting on steady growth in consumer credit in Brazil over the coming years as families spend more on appliances and other goods, while large companies will seek more advice for overseas takeovers, trade financing and foreign exchange transactions. Citigroup wants to be "the lender of choice" in Brazil, said Gustavo Marin, the company's chief executive officer in the country. The bank has rebranded its Citi Financial business in the country Credicard Financiamentos, using the same name as its Credicard card business. It plans to use Credicard's database of customers "to jump into the lending piece", Marin said. "We are putting together a big lending machine," Marin said. "This is going to be one of the engines of growth for us in the consumer space going forward." Pandit added that the consolidation of the banking sector in Brazil could present opportunities for Citigroup. The New York-based bank raised nearly $1 billion (Dh3.67bn) from the sale of a stake in Brazilian credit card operator Redecard in March. In 2008, Citigroup bought Brazilian brokerage Intra, betting on an increase in stock trading in the South American country. Pandit was careful to stress the US will remain a key market for Citigroup. "We have a strong presence in the US and that will continue," he added. "We will be the single largest emerging market financial services company." He also said the bank's credit card and mortgage portfolios remain challenging. "We're going to have to go through whatever the losses are likely to be on that and cover with the income we're generating," said Pandit. Keep up with the latest business news from the region with the daily Emirates Business 24|7 newsletter. To subscribe to the newsletter, please click here .