Citi Raising Cash Through Sale Of German Banking Unit

New York, NY (AHN) - Citigroup announced Friday they will sell their German retail banking business for $7.7 billion to French bank Credit Mutuel.

The deal will be an all-cash transaction that will help strengthen the Citigroup balance sheet, as well as add liquidity.

The company said the deal includes its Citibank Privatkunden AG and Co. KGaA, and certain affiliates.

The result of the deal is expected to provide Citi with an after-tax gain of roughly $4 billion.

"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 businesses," Chief Executive Vikram Pandit said in a statement, according to the Associated Press.

"In Germany, our talented corporate and investment banking teams remain central to our strategy and we're committed to maintaining their leadership position in this market." he said.

Citibank Germany had net assets of $1.5 billion in 2007 and earnings of $573.3 million.

Shares of Citigroup (C) finished Friday lower 0.5 percent to $16.19 a share.