Challenger builds empire
Challenger International has purchased Citibank's margin lending business for an undisclosed sum.
Challenger International has purchased Citibank's margin lending business for an undisclosed sum.
Challenger managing director Bill Ireland says the terms of the deal are confidential, but that the business "was not generating a lot of profit for Citibank".
"We bought it because we were trying to get into that business ... it gives us critical mass," he says.
Challenger says the sale will be "seamless for Share Finance clients and is a positive develop-ment for the business strategies of both companies".
The margin lending business has about $80 million of loans for about $200 million of invest-ments in shares and managed funds.
Ireland says the business will complement Challenger's existing range of financial products such as warrants, property trusts and leveraging.
He says Challenger also pursued the deal as it "had identified margin lending as a key product in providing additional service to stockbrokers and financial advisers".
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