Image: Reuters Berita 24 English - Citigroup Inc. plans to hire about 3,000 new people in the next few years for its Asia institutional busi...
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| Image: Reuters |
Berita 24 English - Citigroup Inc. plans to hire about 3,000 new people in the next few years for its Asia institutional business. This will help the company focus on a fast-growing region where it has left consumer banking in most markets.
Citi's plans to hire more people were not known before, but they show that they want institutional banking and wealth management to be growth engines. They want to increase revenue in a region that has become a battleground for global banks that want to take advantage of the region's large economies and growing wealth.
Citi's institutional business includes investment banking, corporate and commercial banking, and custody services, among other things.
In an interview with Reuters, Asia-Pacific CEO Peter Babej said, "We're talking about the real meat and bones of growing our business across Asia." Babej started this job in 2019; before that, he was the global head of the bank's financial institutions group.
Citi has about $200 billion in wealth assets in Asia, and a spokesman said the bank was "on track" to grow client assets by $150 billion by 2025, even though the global economy and markets are uncertain.
The bank's plans to hire about 2,300 people by 2025 for its wealth management unit and to grow its business with Asian institutions were announced last year.
Citi said last year that the $7 billion it got from selling consumer banking businesses in 13 markets, 10 of which were in Asia, would either be given back to shareholders or invested in profitable institutional banking and wealth management units.
The bank's main regional institutional businesses are in Hong Kong and Singapore, and Babej said that these two hubs would be a big focus of the 3,000 new jobs for the unit. It doesn't say how many people work for the business.
"That gives you an idea of how big the set of investments we're talking about are, both in terms of people and money," Babej said.
Citi made a single wealth management business last year to serve both wealthy and ultra-wealthy clients. The Asia wealth business is also based in Singapore and Hong Kong, which are major financial centers where the bank still has consumer banking units.
"WHY CHINA IS IMPORTANT"
Last month, bankers and analysts told Reuters that wealth managers at the world's largest banks are lowering their expectations for Asia. This is because China's regulatory crackdown and the slowdown caused by COVID have caused clients to stay out of the market.
"As global growth slows, Asia's growth slows, too, but it's still higher than most other places in the world," Babej said.
"This growth, which means portfolio wealth, is something we're very happy about, and the global solutions we can offer for this wealth are becoming more and more important for our Asian clients."
Babej thinks that China's growing wealth is "very significant" despite macroeconomic headwinds, uncertainty about Beijing's so-called "common prosperity" drive, and problems caused by COVID control measures.
"Even at a lower GDP (gross domestic product) growth rate, it grows faster than in the rest of the world," Babej said, adding that it was hard to predict how the common prosperity drive would affect clients' international investments.
Even though China's economy was expected to slow down sharply this year because of things like the pandemic, the head of Citi Asia said that China's economic and geopolitical problems would not last long and would not change the bank's strategy.
He said, "We're in China for the long haul." "Given the geopolitical and macroeconomic situations, there are some questions, but we are big believers in China's importance in the long run."
Babej, however, did say that it was hard for both Citi clients and bankers to not be able to travel to China because of the country's zero-COVID policy, which required inbound travelers to stay in quarantine for two weeks.
"Our clients are much more willing to work over Zoom, but at the end of the day, not being able to travel is a challenge, especially from a private bank's point of view."
