Citigroup plans to hire up to 500 people in its wealth management business in Hong Kong as it focuses on “wealth centres” in Asia under new CEO Jane Fraser and significantly revamps its consumer banking business in the region.
The expansion will include more than 300 new relationship managers in the city in the next five years, as the bank aims to triple its clients and double its assets under management (AUM) in Hong Kong’s wealth business by 2025.
The American bank previously said it was planning to expand its headcount across its businesses in the city by up to 1,700 people, including wealth management, as it seeks to tap increasing capital flow from mainland China and rising affluence in the Greater Bay Area.
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“Hong Kong is a key strategic market for Citi and our Hong Kong franchise is one of the largest contributors to Citi’s revenues globally,” said Angel Ng Yin-yee, the chief executive of Citi Hong Kong and Macau. “Citi has a long history in Hong Kong and we are confident in our future here with a strategy to support and grow with our clients.”
On Thursday, Citigroup said it would exit the consumer banking business in 13 markets internationally and focus on wealth centres in Hong Kong, Singapore, the United Arab Emirates and the United Kingdom. The revamp of its consumer banking business would include exits from mainland China, Malaysia, Taiwan and other markets where the bank said it lacks the scale to compete.
“We will invest to grow the integrated wealth, payments and consumer lending businesses in our Hong Kong and Singapore hubs, which provide comprehensive solutions for customers with global needs and aspirations,” said Citi’s Asia-Pacific chief executive Peter Babej. “Asia is critical to our firm’s global ambitions, and we will allocate resources to drive profitable growth for our franchise.”
Citi’s global consumer banking revenue declined by 14 per cent to US$7 billion in the first quarter, including a 9 per cent drop in revenue in its Asia operations. The revenue decline in Asia was driven by lower cards revenue and lower deposit spreads, partially offset by strong investments revenue and deposit growth, the bank said.
Citi’s wealth expansion comes as other banks are bulking up their operations in the region as China further opens its financial markets to foreign money and more funds are expected to flow from the mainland’s wealthy into Hong Kong as part of the upcoming Wealth Connect scheme.
In February, HSBC said it plans to invest US$3.5 billion and hire more than 5,000 people in its wealth management business in Asia over the next five years as it targets high net worth and ultra high net worth clients.
Credit Suisse, another rival, plans to triple its headcount in China over the next three years.
“We are already a market leader in wealth in Hong Kong and taking this business to the next level is a strategic priority,” Lawrence Lam, CEO and consumer business manager for Citibank Hong Kong.
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