Fraser aims to simplify Citi

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Jane Fraser, chief executive of Citi, said the bank was refreshing its business strategy to focus on the strongest scalable growth and to simplify the organization.

Jane Fraser, Citi

Fraser spoke at a press conference on July 1 during his first international trip in 16 months to London, the world’s second largest banking center, to meet with colleagues, clients and regulators. She said, “I thought it was important to be here.

The corporate strategy review is undertaken according to four principles, one of which is to take a clinical look at its various activities and see where the bank is positioned to add value. After Fraser took over as chief executive in March this year, the bank announced it would close its retail banking operations in 13 markets in Asia, Europe and the Middle East, including Poland and Russia.

“We’re going to focus on the companies where we’re seeing the strongest scalable growth and look at how to make banking well connected,” Fraser said. “We are looking to simplify Citi.

She added that wealth management, especially in Asia and offshore centers, offered this opportunity but that the bank did not have the size required to be sufficiently competitive in consumer banking in certain geographies. Therefore, it was best to get out of those retail banking markets and deploy capital by investing either in growth opportunities or returning to shareholders. Citi will continue to provide institutional and capital markets services in these geographies, as well as the treasury and transaction management services that Fraser has described as “our crown jewel”.

“I want us to focus the bank on London, Switzerland and the Middle East as major centers of global wealth,” Fraser said.

The change in strategy is also in part in response to U.S. regulators, the Office of the Comptroller of the Currency and the Federal Reserve, which announced coercive action against the bank in October last year. The Federal Reserve said in a statement that its cease-and-desist order requires the bank to improve its risk management and company-wide internal controls because it failed to take swift action. and effective in correcting practices previously identified by the Fed in compliance risk management, data quality management and internal controls.

Fraser said the bank’s transformation needs to ensure it not only addresses these regulatory concerns, but also looks at the world to come and the need for digitization. Citi moves billions of dollars daily and that volume will only increase.

“How do we ensure that we position Citi for even greater scale, volumes and speed, and ensure that we have the technology platform, operating systems, processes and environment?” control so that we remain the preeminent bank in these different activities before? ”she asked.“ By getting out of the work that we do, we will be more efficient, more efficient and we will serve our customers better. ”

She described the bank as striving for excellence in customer service delivery, operations, risk management and controls.

“We defined all of this work and it was well received,” Fraser added. “We are in the process of finalizing the most important piece which is execution and the investment plans to get us there. “

The data function, policies and control frameworks have already been redesigned and Fraser said the bank has implemented some of the culture changes by attracting new talent in the areas of risk, data and people.

“It will take a few years, but we’re going to be pretty formidable,” Fraser said.

On Fraser’s first day as chief executive, the bank pledged to reduce net greenhouse gas emissions by 2050. Citi has since pledged $ 1 trillion in sustainable financing by 2030. Half of this funding is tied to environmental goals and the other half to other sustainability elements such as racial and gender equality and affordable housing.

Fraser emphasized his belief that sustainability can be very good for business.

“We recognize that economic growth and a fair society are important,” she added. “The banks have emerged from this crisis stronger in terms of capital, liquidity and customer support and we all intend to play a very important role in helping to move this recovery forward on all these dimensions.”

Flexible working

In the wake of the pandemic, Citi will use a hybrid model for its 200,000 employees worldwide, with most employees in the office at least three days a week. The bank mapped each function to see if it can work in a hybrid model, as some roles need to be entirely in the office, while a small number can be entirely remote.

“The future of working at Citi will see almost all of us back in the office, but there is a big ‘but’ which is increased flexibility,” Fraser said. “I don’t think any of us want to come back and feel like we’re coming back on Groundhog Day or the way it always has been.”

Fraser added that last year showed flexibility is important and the bank has shown that it can still be very successful. In addition, she believes it will be a competitive advantage to attract talent.

She explained that she personally benefited from the flexibility by working part-time for five years when her two sons, now 19 and 22, were born and this has been critical to her success. When she returned to the office, one of her clients said she had become a better leader and advisor because she was so much more empathetic.

“I’m talking about excellence and empathy and I don’t see a compromise between the two,” she added. “I believe in flexibility for men and women. Flexibility doesn’t stop you from being aggressive, doesn’t stop you from having a successful career and please use me as an example that you can achieve that balance.

The pandemic has also reinforced the case for all forms of diversity and the absolute need to think differently according to Fraser, who is the first female CEO of a major bank in Wall St. Her own management team comes from around the world. . Fraser pointed out that she is a Scottish woman at the head of an American bank and that she has worked around the world, including leading Latin America for Citi.

“Having diverse points of view around the table has been essential to spur innovation and is now a competitive necessity,” she added.

Fraser described visiting the London trading floor on his current trip and seeing many more women.

“It was a real boost for me,” she said. “It was the same in the technology teams, in our data teams. They are really on fire, doing a fantastic job, are on their own and are harnessing their strengths. “

Citi’s board of directors is 50/50 men and women, and there are women leaders such as Kristine Braden, Head of Europe; Elissar Farah Antonios, head of the MENA cluster; and Ebru Pakcan, Head of Emerging Markets EMEA Cluster.

The bank is also on track to meet its global goal of having 40% female vice presidents or assistant vice presidents and above by the end of this year and ensuring it has a equal pay.

During her visit, Fraser also met senior women in other organizations such as Ana Botín, executive chairman of Spain’s Santander banking group, and Alison Rose, managing director of NatWest Group, the UK bank.

“It’s nice to see more of us and it sends the message that diversity is valued,” said Fraser.

Brexit

The UK’s departure from the European Union has led some of the bank’s clients to adjust their trade and investment flows. In addition, different European financial centers are building and strengthening their own capacities in areas such as clearing and banking.

Fraser said: “There is no doubt that we are in the midst of one of these great structural changes in Europe and the UK.”

However, she stressed the connectivity and London’s position as a global hub, so people shouldn’t see change as a zero-sum game between Europe and the UK, but be mindful of the competitiveness in a global context.

“We are very attached to London as the EMEA headquarters, we are not going to change that,” said Fraser.



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