Citi Outlines Strategy for Expanding Wealth Management Division
Citi, the global financial services giant, is making significant moves to bolster its wealth business. Andy Sieg, the head of wealth at Citi, has announced that the company is poised to double down on its wealth business to compensate for exits from retail banking in various regions.
In a bid to ensure productivity, Citi has reduced the size of its adviser footprint in the near term. The bank is also revamping adviser incentive systems and productivity expectations to fuel new asset growth.
Two key appointments are set to take effect in September. Keith Glenfield, a veteran from Merrill Lynch, will join Citi to take over as head of investment solutions. Kris Bitterly, previously the head of investment solutions at Citi, will become head of Citi's workplace wealth business.
Dawn Nordberg, a veteran from Morgan Stanley, was recently hired by Citi to lead integrated client engagement. These appointments are part of Citi's strategy to strengthen its leadership team, which is also enhancing coaching and training to bolster productivity and improve the client experience.
Citi's focus on its wealth business is not surprising given the current financial performance of the division. Despite its strong presence in Asia, which Sieg described as the strongest and fastest growing part of its wealth business, Citi's wealth business has seen a decline in financial performance compared to the broader market. Revenue has decreased as expenses have risen.
However, Citi's clients have $5 trillion invested elsewhere, indicating a need to deepen current relationships and increase growth. To this end, the wealth unit at Citi has identified asset gathering as its primary focus, with net new investment assets serving as the guiding star for its leadership team.
Piper Sandler analyst Scott Siefers called Sieg's comments an important update, given that Wealth has been an underperformer. Siefers believes that these strategic moves could potentially turn the tide for Citi's wealth business.
Citi has already completed the major actions of its reorganization, resulting in a job cut of approximately 7,000. The bank is also seeking to poach talent to strengthen its wealth segment, with Sieg suggesting that this is not the last of such appointments.
A previous hire, BofA vet Plaus, will lead North America private bank. The current leadership vacancies in Citi's wealth management division and the interested candidates have not been publicly disclosed.
These strategic moves by Citi come at a time when the wealth management industry is evolving rapidly. The bank's focus on productivity, client experience, and asset gathering could position it well for the future. As Sieg put it, "We are not done poaching talent to strengthen our wealth segment."
