n FRONT STORY STRATEGY

Citi restructures and shakes up leadership

Sets up new Banking, Capital Markets and Advisory unit

CITIGROUP is shaking up its structure and

leadership ranks with the departure of a trio

of long-serving executives, including chief

financial officer John Gerspach, and an

overdue revamp of its investment banking

business.

The moves give Citi CEO Michael Corbat a

new chance to reshape the bank five years

into his reign and just ahead of the looming

retirement of Citi chairman Michael O’Neill

in eight months. Corbat is the only one of

his peers who is not CEO and chairman, and

could take on that role.

“Naming a new chairman is the most

important governance decision at Citi in the

last six years,” said Wells Fargo analyst Mike

Mayo. “The new chairman, whether it’s

Corbat, another board member or someone

from outside, needs to better ensure that

Citi becomes more optimised.”

Citi took a step towards better

optimisation by bringing its capital markets

origination business alongside its corporate

and investment banking unit.

The new unit, called Banking, Capital

Markets and Advisory, or BCMA, will be led

by Tyler Dickson, global head of capital

markets origination since 2008, and Manolo

Falco, the head of the corporate and

investment bank in Europe, the Middle East

and Africa since 2009.

The reorganisation brings Citi closer to

the set-up at many of its Wall Street rivals, in

having a single unit for merger and

acquisition advisory alongside helping

companies raise debt and equity.

Ray McGuire, the global head of corporate and

investment banking for the last 13 years, will

take on a new role as chairman of BCMA and

vice-chairman of Citigroup. He will focus on

managing senior global client relationships.

Dickson said the changes were “a bit of a

catch up” with how the businesses had been

run for the last several years, so it doesn’t

herald a big shift.

“The mind shift has already happened,”

Dickson told IFR. “We are trying to intensify

that and give people a greater sense of

confidence that now is the right time to put

additional pressure on the gas pedal.”

Falco said Citi’s aspiration is being one of the

top three global firms in investment banking.

“We will obviously have some brighter spots

than others, but if you are at Citi everyone has

to aspire to lead in their markets,” he said.

Falco said business areas that deliver will

get more capital and investment.

The bank will fill out the leaderships ranks of

BCMA in the coming months as CIB and CMO

are integrated, said Jamie Forese, CEO of the

institutional clients group, in a memo to staff.

Mayo said BCMA may be a step towards

“optimisation”, but it’s not enough.

EXECUTIVE SHAKE-UP

In addition to the changes in capital

markets, Gerspach is one of three top

executives who plan to retire after a

combined 103 years at Citi, which could give

the bank a chance at a refresh.

Gerspach is retiring on March 1, after

nine years in the position. He is the longest

serving CFO at the big five US banks. He

helped guide the bank after its near collapse

following the 2008 financial crisis and the

ouster of then CEO Vikram Pandit in 2012.

He will be succeeded by Mark Mason, who has

been the CFO of the institutional clients group

since 2014. Mason, who has been with Citigroup

for 17 years, has also been responsible for

preparing the bank’s annual CCAR submission.

Citi’s EMEA CEO Jim Cowles is also retiring. He

exits the bank after 39 years to establish a not-

for-profit organisation. He will be leaving the

firm at the end of the year, once the selection

process for his successor is concluded.

Bill Mills, a 36-year veteran of the bank and

currently CEO for North America, will also be

retiring at the end of the year.

Philip Scipio, Steve Slater

International Financing Review September 8 2018 15

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Credit Suisse

CEO Tidjane

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as Bellwether

observes

Source: Coalition

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4.96.

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 FICC  Equities  M&A  ECM  DCM

EQUITIES DRIVE DECENT H

INVESTMENT BANK REVENUES IN H1; EQUITIES +20%, ECM +10% VS YEAR AGO

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