The 10th largest bank in the Philippines is, reportedly, in final talks to acquire Citigroup's retail business in the country. Aboitiz-led Union Bank of the Philippines plans to take over the global banking company's consumer and retail banking assets in a deal estimated to be worth around $1 billion.

Sources with knowledge in the matter said the deal is expected to be announced and signed within the next two to three weeks.

The same source said Unionbank was able to beat some of the nation's largest banks in the bid to acquire Citi's local consumer banking business because of its heavy investments in technology and digital banking. Over the past few years, Unionbank has invested billions in upgrading its digital banking systems as part of its digitalization strategy.

In its filing with the Philippine Stock Exchange, Unionbank disclosed that it was named as the preferred bidder for Citi's Philippine business. The bank confirmed that it is in talks with Citigroup about the potential acquisition of its Philippine business.

Unionbank general counsel and corporate secretary Joselito Banaag said that the transaction would still be subject to the completion of satisfactory due diligence, negotiations, and regulatory approval, among other requirements.

Sources familiar with the negotiations said Unionbank had presented an offer to Citigroup to retain more than 1,800 of its employees in its retail and consumer banking unit in the Philippines. Sources said the "match made in heaven" will be beneficial to the country's banking industry as a whole.

The source said both banks currently operate one of the most advancing digital banking systems in the country. By combining their relative strengths, both brands will be able to greatly bolster their respective businesses. The source added that Unionbank had shown significant strength in mortgages, while Citi's strength lies in its credit card segment.

Unionbank disclosed in its latest financial report that it had assets of about $12.82 billion as of the end of June. The bank is the 10th largest lender in the Philippines in terms of assets and the 7th largest in terms of capital. Unionbank also ranks 10th in the country in terms of total deposits and net loans.

Citi stated in April that it was departing the retail banking segment in the Philippines and 12 other Asian regions, as well as the EMEA area, which generated $4.2 billion in revenue last year.

The American banking behemoth has chosen Singapore, Hong Kong, the United Arab Emirates, and London as its worldwide consumer banking hubs. Citi is the Philippines' largest foreign bank and ranks 12th in terms of assets.