Citibank Has Ambitious Plans For Australian Credit Card Market

Post by NeilMc on March 17, 2010 · Under Business News, Company News, banking, credit cards · Comment 

Global bank giant Citibank has ambitions to end the near total dominance of Australia’s Big Four banking groups on the consumer credit card market.

Citibank, which is the retail banking operation of Citigroup says it wants to usurp NAB’s position as the fourth most active issuer of Australian credit cards.

John Larsen of consumer banking and cards for Asia-Pacific says there are tremendous opportunities for growth in retail banking in Australia.

“We see Australia as a sophisticated and very competitive market — it’s dominated by the four major banks here, we are continuing to see opportunities for us. We’re a significant player in the credit cards market and we’ve had success with a number of the partnerships we have in place We also have our own branded credit cards business, which is a durable business.” Mr. Larsen said.

Citbank, with 9.8 per cent of the market, is the fifth largest credit card issuer in Australia. CBA is the dominant player having captured 19.7 per cent, with ANZ in second place controlling 18.2 per cent. Westpac is the third largest issuer, owning 17.6 per cent with NAB rounding up the rear, having issued 12.1 per cent of all cards.

Citibank’s ambition to break into the top four is largely driven by 10 per cent growth in receivables the lender experienced during calendar 2009, well above the rate experienced by the major lenders.

“The competitors don’t make it easy for us; we think we offer better value for the business that we are competing for. We offer value and transparency, and if we can continue to do there’s no reason we can’t gain the additional market share to take us to number four.” Mr. Larsen said.

Mr. Larsen says Citbank intends to eschew large scale acquisition opportunities in the Asia Pacific region, preferring instead a strategy of organic growth.

“If you look at Citibank and our DNA, we have done very few acquisitions, although we have created some alliances, but the core of our business is to grow, account by account.” he said.

Citibank’s joint venture to offer finance and operations support in conjunction with branded cards from Richard Branson’s Virgin Group will begin in July.

Mr. Larsen said Citibank was now well-positioned in the Asia-Pacific region.

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