DALLAS — Santander Consumer USA announced today that it will purchase $3.2 billion of CitiFinancial Auto's loan portfolio.

Moreover, Santander has also agreed to service a portfolio of approximately $7.2 billion of auto loans that will be held onto by Citi.

The $3.2 billion portfolio purchase will be at a price equal to 99 percent of the value of the gross receivables, Santander noted. The transaction is expected to close by the end of the third quarter. It is subject to normal regulatory approvals and usual closing conditions.

According to Santander officials, "The purchase supports Santander Consumer USA's strategy to explore partnerships and transactions that complement the company's existing business model and provide incremental benefits from a service and growth perspective.

"Santander continues to be committed to originating and servicing indirect and direct auto loans that meet Banco Santander's strict standards related to prudent underwriting and risk mitigation," officials added.

Citi indicated that the sale to Santander is consistent with its strategy to reduce the assets and businesses within Citi Holdings, its portfolio of non-core operating businesses and assets in an "economically rational manner while working to generate long-term profitability and growth from Citigroup."

"Citi continues to make progress on its strategy and will continue to pursue opportunities to divest Citi Holdings assets in a manner that creates the most value for shareholders. Upon competition, this transaction will reduce GAAP assets in Citi Holdings by approximately $3.2 billion," according to Citi officials.

Editor's Note: Brent Huisman, vice president of asset remarketing for Santander, will serve as a key speaker for the fall National Remarketing Conference. For more information, visit nrc.autoremarketing.com.