Citi CEO Takes Aim at Wealth Mgmt in Plan to 'To Crush the Competition’

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Citi chief executive officer Jane Fraser has plans remake the bank into a sleeker, higher-performing organization and has put the firm’s wealth management business near the center of those efforts, according to news reports.

“I want to crush the competition,” Fraser told Bloomberg, while sipping coffee, the outlet reports.

Before becoming the first female CEO of a major U.S. bank in February, Fraser served as Citi’s president. In that role, she merged the company’s wealth management unit, which is aimed at retirement savers, with Citi’s private bank, which caters to the ultra wealthy, Bloomberg writes. The newly formed unit, meanwhile, taps Citigroup’s commercial bank, which serves midsize businesses, for its customer pipeline, according to the news service.

Uber and Airbnb started off in our commercial bank in the U.S. as a client, the unicorns in Latin America and Asia started off in our commercial bank as a client,” Fraser said, according to Bloomberg. “We’re helping those companies create that wealth in the company, and then we can help the owner.”

Citi’s wealth management business currently lags behind in the U.S. — after all, the company sold its Smith Barney brokerage to Morgan Stanley in the wake of the financial crisis, helping propel Morgan Stanley into the wealth management arena, the news service writes. Chris Kotowski, an analyst at Oppenheimer & Co., calls the move “unfortunate,” according to the news service.

But Citi’s wealth business already ranks third in Asia — and Fraser believes the firm now has an advantage to grow the business in the U.S., Bloomberg writes.

“A lot of the U.S. model is very broker-driven, which I think is going to get obliterated in the years ahead,” Fraser told the news service. “Because we don’t have an asset manager, we’re very clear that we’re there to serve our clients.”

Moreover, Citi has taken a strategic step to lure talent from rivals, Bloomberg writes.

The company has been more flexible about returning its staff to the office than other Wall Street firms, and the decision gave it a “weapon:” Fraser’s team has been getting inquiries from executives at JPMorgan Chase and Goldman Sachs looking to jump ship, according to the news service.

Citi is also selling off pieces of its business, including its consumer bank division in several markets across Asia and Europe. Fraser says her team will assess all parts of the business and be “clinical and dispassionate when we’re looking at things,” she says. “We make sure that we are going to be simpler.”

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