Citigroup announced that it has reached a definitive agreement to acquire Grupo Financiero Uno, the largest credit card issuer in Central America, and its affiliates.

The firm says that the acquisition of GFU, with US$2.1 billion in assets, will significantly expand the presence of Citigroup’s Latin America consumer franchise, enhancing its credit card business in the region, and establishing a strong platform for regional growth in consumer finance and retail banking. The financial terms of the transaction are not being disclosed.

GFU is privately held and has more than 1 million retail clients representing 1.1 million credit card accounts, US$1.2 billion in credit card receivables and US$1.3 billion in deposits in Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and Panama as of September 30. It operates a distribution network of 75 branches and more than 100 mini branches and points of sale. GFU will continue to operate under its established brands during the integration.

The transaction, which is subject to regulatory approvals in the US and each of the five countries, is anticipated to close in the first quarter of 2007 and is expected to be accretive to Citigroup’s earnings in the first year.

“Citigroup’s acquisition of GFU is an important strategic step in our ongoing efforts to expand our consumer operations to better serve clients in Latin America,” said Charles Prince, chairman and CEO of Citigroup. “It quickly and effectively extends our retail distribution capabilities into five additional Central American countries and complements the leading presence we have built in corporate banking in the region during the past 100 years.”