Fraser, in the post since March 2021, said the changes will “eliminate unnecessary complexity across the bank”, as well as helping the group deliver its targets. The US group has already spun off a raft of retail operations.
A day after Citigroup chief executive Jane Fraser announced sweeping management changes to the US group, one detail that stands out for readers of this wealth management news service is how she’s scrapped the personal banking, wealth management, and institutional clients group management layers.
In a move to restore the bank’s fortunes, Fraser – in the job since early 2021 – has also eliminated the existing regional layers in Asia-Pacific, Europe, the Middle East and Africa, and Latin America.
Citigroup is continuing changes that have seen it spin off retail banking in more than a dozen countries.
The company will now operate five main businesses and eliminate the three regional chiefs who oversee operations in about 160 countries around the world.
Media reports, such as from Bloomberg on Wednesday, said the moves will cause job cuts in Citigroup’s back-office functions. (That news service did not indicate the number of people affected.)
“We have taken hard, consequential, tough decisions here,” Fraser told investors at a conference. “They are not going to be universally popular within our bank. It’s going to make some of our people very uncomfortable. I am absolutely fine with that.”
Fraser is one of the most senior women in global banking in what is still a largely male-dominated industry.
On Wednesday after the announcement of the changes, Citigroup’s shares rose 2.1 per cent to $42.54 at 2:41 pm in New York (source: Bloomberg, 13 September). Since the start of 2023, the bank’s stock price has fallen about 7.45 per cent.
Fraser has been busy. In April 2021 the bank made senior changes to its private banking arm. Ida Liu, global head, Citi Private Bank, talked to this news service earlier in 2023 sbout the bank’s strategy.
In its statement this week, Citigroup said “the new, flatter structure elevates the leaders of Citi’s five businesses and eliminates management layers, which will speed up decision-making, drive increased accountability and strengthen the focus on clients.”
“Simplifying the organisation will also advance the execution of Citi’s transformation, the firm’s top priority,” it said.
Fraser said in a statement: “I am determined that our bank will deliver to our full potential, and we’re making bold decisions to meet our commitments to all our stakeholders.”
“These changes eliminate unnecessary complexity across the bank, increase accountability for delivering excellent client service and strengthen our ability to benefit from the natural linkages that exist amongst our businesses, all with an eye toward delivering on our medium-term targets and our transformation,” she said.