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Citigroup Plans to Target Independent Advisors in Wealth Management Push

By Katherine Chiglinsky

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Citigroup Inc., whose U.S. wealth management business oversees about $181 billion in client assets, created a new business to sell products through independent advisors as Chief Executive Officer Jane Fraser maps a path to managing more money for wealthy individuals.

“With Citi Alliance, we will be providing core banking and lending solutions to independent advisors and broker-dealers, one of the fastest growing segments in the United States,” Jim O’Donnell, head of global wealth management, said Wednesday at the company’s investor day.

The bank is working with InvestCloud to offer the products to nearly 150 wealth management firms on that company’s platform.

Fraser is charting a new course for the bank, which has been underperforming its peers on key profitability measures.

Citigroup is targeting growth in three main businesses — services, the commercial bank and wealth — given what it sees as higher-return capabilities in those operations.

Citigroup’s private bank has long catered to the ultra wealthy, and counts more than a quarter of the world’s billionaire’s as clients, while the firm’s Citigold offerings cater to high-net-worth investors with as much as $10 million in assets. Now, the New York-based company is targeting the vast stretch of wealthy investors in between those two groups.

Overall, the firm expects revenue in the global wealth management business to increase at a high-single-digit to low-teens compound annual growth rate over the medium term, according to a presentation Wednesday.

“We see this as a great opportunity in the months and years ahead,” O’Donnell said.

(Image: Bloomberg)

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