While it prepares on the exit of its holding in Smith Barney , the brokerage giant, Citigroup is back won a hiring spree for building the hopeful U.S wealth management business whose center is the high-end Citigold Account.
Citibank is set to higher as many as 300 personal bankers over the span of next 2 years with an aim of reaching the hiring number of 800 by the end of 2014 , according to Venu Krishnamurthy , the Citigold Wealth Management President.
Combined with the capability of organic growth , Citigroup has a platform for high-end solutions and products , in what would be picking the Lego pieces from the world’s biggest box ; said Murthy in his interview. For supporting the expansion , John Cummings, the veteran Merrill Lynch brokerage executive was hired by Citigroup for being the CEO of Citigold Wealth Management. Frank Consalo who was the head of the overall wealth management business was fired from PNC Financial services where he was supervising nearly 300 advisers. Through the Citigold business the bank is trying to sell , through its retail branches, more and more services in the personal investment sector. This being a key strategy as in 2009 it had agreed with Morgan Stanley to sell Smith Barney , its brokerage firm , to the rival for raising the cash for offsetting the financial crisis. The remaining interest in the venture will be sold by Uniti Citi agreeing not to complete in the wealth management sector. After this move , the ranks for Citigold could lgrow to thousands in the U.S at par with the Citigold in Asia , having 2000 advisers. This is a strategy by big banks for attracting the affluent customers , by promoting investment management and banking services , but not too rich for private banking. These programs will be offering highly sophisticated advice and driving traffic to branches , thereby creating a new revenue stream for the banks.
Citi’s rival JPMorgan Chase & Co is also in the process of expansion , with already having 366 private client offices and has a goal of 1000 such offices with over 550 advisers by the end of next year. The estimate by JPMorgan suggest that the business could generate a $1 billion a year.
The advisers who will be employed by the banks measure to a very small number of invested assets in U.S . The banks have employed about 15000 brokers who are overseeing around $480 billion in assets. While elsewhere they have around 55,550 advisers who oversee around $5.6 trillion in assets. Through the offer of white glove services and dressing up the branches , banks are hoping to attract the affluent clients who will generate more income for the banks than mass-market clients.