Citigroup boss reportedly considers break-up of bank’s biggest division

Citigroup boss reportedly considers break-up of bank’s biggest division

  • Citi’s Institutional Clients Group (ICG) would be split into its three divisions
  • ICG made more than half of the bank’s $19.4bn in revenue in the second quarter

The boss of US banking giant Citigroup is reportedly considering a break up of the lender’s biggest division in a major shake-up.

The plan would see the bank’s Institutional Clients Group (ICG), which provides financial services to institutional investors and governments,  split into its three primary business segments.

Jane Fraser, who joined as chief executive in 2021, would have ‘greater day-to-day control’ as a result of the proposed changes, according to a report in the Financial Times.

Shake-up: US bank giant Citi could split its largest division into three new segments

The three new divisions – investment and corporate banking, global markets and transaction services – will be run by their current heads, who would report directly to Fraser.

ICG made more than half of the bank’s $19.4billion revenue in the second quarter.

The potential move comes after the bank said this month that Paco Ybarra, the chief executive of the division, would leave in the first half of 2024.

Ybarra’s planned departure followed a number of senior management changes as Fraser looks to restructure the bank amid falling profits.

Last month, Citigroup reported a 36 per cent fall in profits to £2.2billion, as higher interest rates failed to offset a slump in its trading revenues. 

It was one of the few large US banks to report declining earnings alongside Goldman Sachs, which clocked up its worst performance in three years.

Fellow US banking giant JPMorgan, on the contrary, said second-quarter profit surged by two-thirds.

On top of ICG, Citi also has a consumer-focused division, which includes retail banking, credit cards and wealth management.

The group has already said it plans to split the wealth management division from the rest of its consumer bank. 

If the fresh plan to break up ICG goes ahead, Citi would end up with two consumer divisions and three commercial units.