Sep. 5--Citigroup Inc. may be exploring a sale of its Texas retail banks, banking industry analysts said Friday.

"I'm hearing that they are actively soliciting bids for their Texas franchise," said Curtis Carpenter, managing director of Austin-based Sheshunoff & Co. Investment Banking.

Rob Julavits, a Citi spokesman, declined to confirm or deny the possibility of such a sale, which was first reported by the Dallas Business Journal.

"We don't comment on market rumors," Mr. Julavits said.

Houston-based investment banker Dan Bass said he had tried to put together a consortium of half a dozen smaller banks to buy Citi's Texas retail banks.

"I got the impression from when I talked to Citi that they wanted to sell to one entity rather than a consortium of banks," said Mr. Bass, managing director of the Carson Medlin Co., an investment banking firm.

"I'm pretty confident that they're considering offers. But will the bids come in acceptable to Citi? I don't know," he said.

Although Citi is one of the world's banking giants, the company only entered the Texas retail banking business three years ago, when it completed the acquisition of First American Bank.

Citibank was the 13th largest bank in the Dallas-Fort Worth area by deposits as of June 30, 2007, the latest date for which information is available, according to the Federal Deposit Insurance Corp.

At that time, Citibank had $1.4 billion in deposits in North Texas, representing less than 1 percent of the nearly $174 billion in local deposits.

"Their investment in Texas was too small for their objective," Mr. Carpenter said. "The alternatives at this point are either to spend a lot more money and effort to build it to where they want it to be, or to punt and try again later."

It's unclear who might be interested in acquiring Citi's banking operations in Texas, Mr. Carpenter said.

If Citi does sell its Texas retail banking business, it would still have a large presence in North Texas, where it employs more than 10,000 people. The company operates a large call center here and also has some locally based commercial finance and investment banking employees.

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