Citigroup Sells Diners Club Franchise

TORONTO (TheStreet) -- BMO Financial (BMO Quote) plans to purchase the Diners Club North American franchise from Citigroup(C Quote).

Citigroup said the sale would reduce its assets in Citi Holdings by about $1 billion and isn't expected to have a material impact on Citigroup's net income or capital ratios. The transaction is expected to close by March 31, 2010.

"The sale of this business is consistent with Citi's strategy to optimize the assets and businesses within Citi Holdings while working to generate long-term profitability and growth from Citicorp, which comprises its core franchise," the bank said in a statement Tuesday.

The deal gives BMO exclusive rights to issue Diners Club cards to corporate and professional clients in the U.S. and Canada. It will immediately more than double BMO's overall corporate card business.

BMO said the agreement represents net receivables of almost $1 billion and about 7.8 billion in card transactions.

-- Reported by Joseph Woelfel in New York .

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