Citigroup veteran Jane Fraser was named to lead the company’s consumer banking division following an upheaval in the ranks that puts her next in line to become the chief executive officer (CEO), The Financial Times reported on Thursday (Oct. 24).
She will also take on the role of president, a position that has been open since Jamie Forese stepped down in April.
Fraser heads its Latin American operations and has been with Citigroup for 15 years. She replaces Stephen Bird, who left the company to pursue other opportunities.
“A fresh set of eyes in consumer could be a good thing since this is the weak link at Citi,” Wells Fargo analyst Mike Mayo told FT. “The question is the degree and extent that a fresh look will lead to a more radical consumer restructuring, which we feel is needed.”
It is anticipated that Citigroup’s CEO Mike Corbat will leave in two to three years. Aside from Fraser, another candidate for the top spot includes Paco Ybarra, who took over Forese’s role as head of Citigroup’s investment bank.
“Jane has been at our firm for 15 years since she joined from McKinsey to run client strategy in the corporate and investment bank. During the financial crisis, she led our corporate strategy and M&A group and, in many ways, Jane helped shape the company we are today,” Corbat said in a memo to employees. “I remain committed to leading our firm in the coming years and look forward to working even more closely with Jane in her new roles.”
Citigroup’s consumer bank is smaller than those of competitors JPMorgan Chase and Bank of America, but it accounts for almost 50 percent of the firm’s annual revenue, which is about $74 billion.
Better results in the retail division are important to help Citigroup meets “its 2020 return on tangible equity target of 13.5 percent,” the article said.
Earlier this month, Citi was appointed by Victory Capital to provide fund administration, custody, ETF services and securities lending for its most recent acquisition. The new mandate resulted in the transfer of servicing for 53 mutual funds and ETFs to Citi, representing around $80 billion in assets under custody.