The transaction will see Popular, the parent company of Banco Popular, acquire 17 branches and 230 employees.
Popular will also inherit $1.1 billion of deposits and $230 million of loans.
David H. Chafey, president of Banco Popular de Puerto Rico, said: "The deal continues to build our retail base in this competitive financial market. We are looking forward to serve our new clientele with the innovation and values that set Popular apart."
Popular is expected to retain the majority of Citibank's staff and said it expects the transaction to be completed in the fourth quarter of 2007 pending regulatory approval.
Popular has over 300 outlets in Puerto Rico and more than 140 in the US.