Citi Private Bank sees opportunities in S’pore, region in 2024 as it completes most of job cuts

Citi

SINGAPORE – Citi Private Bank has completed most of its job cuts and is optimistic about 2024 as it gains new clients in Singapore as well as the region, and grows its core assets under management by double-digits.

Ms. Ida Liu, global head of the private banking unit of Citigroup, told The Straits Times on May 27 during a visit to Singapore that the recent spate of layoffs is “more or less done”.

“I can’t say no more cuts because there are always normal courses of business reductions, but I can say that the majority has been done.

“We are focused on the future. We’ve already done what we need to do to get fit in the business and we’re focusing on delivering growth from here,” she said.

Citigroup is in the midst of a global overhaul and had said it would eliminate 20,000 jobs by 2026 as part of efforts to improve profitability.

Citi Private Bank, which serves a third of the billionaires in Asia, had a strong start to 2024, Ms Liu said.

“We moved on to a very positive story for 2024. I’m very confident that the ship is turning in the right direction,” she said.

It has been laying the groundwork to boost its business by adding new clients, deepening investments, and focusing on delivering better returns.

The numbers for April and part of May have shown sustained growth.

“I’m feeling very optimistic about the outlook for the business going into the second quarter as well. Suffice it to say that I hope we are over last year,” Ms Liu said.

In the first three months of this year, Citi Private Bank logged US$571 million (S$769.5 million) in revenue, up 1 percent on the year, following a 10 percent drop in the fourth quarter of 2023.

The gain was fuelled by improved deposit spreads and investment fee revenues. Estimated client investment assets under management, trust, and custody assets in Citi’s wealth business rose 12 percent from a year earlier to US$515 billion.

Asia is expected to see the strongest growth in ultra-high-net-worth individuals (UHNWI), or those with a net worth of US$30 million or more, with trillions in assets expected to be passed on to the younger generation over the next two decades.

According to a Knight Frank wealth report, Singapore’s UHNWI population rose 4 percent from 2022 to 2023 and is expected to grow 15.7 percent heading into 2028. Hong Kong’s UHNWI population rose 2.5 percent over the same period and is expected to grow 22.4 percent from 2023 to 2028.

Singapore and Hong Kong continue to be attractive wealth hubs for the super-rich looking to diversify. Citi has two other wealth hubs – in London and the United Arab Emirates.

On Dec 31, 2023, Hong Kong was home to over 2,700 single-family offices (SFOs), according to a Deloitte report while the Singapore Government noted that 1,400 SFOs have been awarded tax incentives.

Ms Liu said Citi Private Bank sees opportunities to capture the wallets of next-generation investors and female clients. Women control a third of the global wealth today and will control over half in the next decade, the banker said.

Another major opportunity lies in leveraging the private banks’ Global Client Service, a one-stop solution for clients, their families, and their companies globally.

Most of Citi’s clients in Asia have family members living in the United States, Europe, and other parts of the world. They can tap Citi’s physical presence in 95 countries.

This advantage has enabled Citi to provide “best in class” investment ideas to clients, Ms Liu said.

The bank established operations in Singapore on July 1, 1902. It was then known as the International Banking Corporation and was the first US bank to set up a branch here.

Globally, clients are looking to extend the duration of fixed-income portfolios to lock in higher interest rates for longer in anticipation of rate cuts by the US Federal Reserve later this year.

They have also pivoted to the stock markets for investment opportunities.

Ms Liu said while the S&P 500 Index has been driven by large tech stocks, there is hidden value among the small- and mid-cap stocks, which offer investment opportunities in technology, healthcare and clean energy.

“We think it’s important to have a global view right now given how high the US market has gone. We believe that there’s some emerging markets that will benefit more in the future, particularly from the US-China bifurcation. So geographic diversification is important,” she said.

Apart from bonds and equities, clients have shown an increased appetite to diversify into private equity, direct investments, and alternative investments.

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