PSA will offer retail banking to raise funds for dealers, auto ops
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PARIS (Bloomberg) -- PSA/Peugeot-Citroen will offer savings accounts through its financing arm to raise funding for dealerships and other automotive operations.
Banque PSA Finance is targeting deposits of 400 million euros ($521 million) by the end of the year, Chief Financial Officer Jean-Baptiste de Chatillon said.
PSA is following Renault in setting up a retail banking arm. RCI Banque began offering savings accounts in February of last year, with a deposit target of 500 million euros. It exceeded that goal and had total deposits of 893 million euros at end of December, RCI Banque said last month.
Standard & Poor's Ratings Services cut PSA's debt in February by one level and downgraded debt at the banking unit to junk. France's government offered guarantees last year for as much as 7 billion euros in new bond sales by the banking unit.
PSA has won temporary European Union backing to sell 1.2 billion euros in government-backed bonds and must present more details on the plan to win full approval.
RCI Banque is aiming for total deposits of 2 billion euros at its French and German retail savings businesses by the end of this year, and to increase that figure to 2.5 billion euros by the end of 2014.
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