Citi is done, thanks Fraser
I’ve been working at Citi for a few years. It’s been getting worse since Fraser took over, with her woke nonsense, management choices (she basically dissolved the Houston Energy group… case in point for those who know how good this team was) and I have some reservations regarding the seniors that have been brought in recently (mostly from CS)…
After the announcements from this week, my group head (who is the main reason I’ve stuck around so far, real inspiring professional) looked dismayed and told a few of us that he would probably be put into early retirement or in a useless vice chairman of something role. Rumors I’m hearing about guys who will get the boot and guys that will get promoted are seriously concerning.
Things have never been perfect at Citi, but I had always thought that its bad reputation was exaggerated, there were some groups that were really good and the wide footprint gave the opportunity to work on nice exotic stuff sometimes. But that’s it. We’re done. Fraser is going to destroy this bank as a whole.
I’m updating my resume this weekend. Bad timing in current markets but I can’t stand it anymore. It saddens me and I feel betrayed.
Congrats Fraser, taking down a decades long BB in a couple of years is quite an accomplishment.
To all those starting to apply for their 2024 summer internships, leave out Citi, not worth it.
Citi houston group falling apart is such a shame. Why would Fraser destroy one of Citi’s top groups?
Agree Houston has had a big exodus
I'm not impressed with her thus far at all
That said, I do think (hope) this stream-lining is a good thing of getting rid of some of the unnecessary heads of various clusters that just cause more complexity.
At the group level, our group head effectively thought it was a non-issue for IB and CB for the most part.
Apart from Dimon, leadership across the board has been rough.
Gorman did really well…just doesn’t pay juniors well.
Brian Moynihan seems to be doing a good job
Scharf at WF has done a good job, considering he Inherited a scandal ridden bank with an asset cap right before covid.
Honest question - is Citi a takeover target? I get that there are antitrust considerations. But at $80bn market cap, it’s not exactly a behemoth and well in the range of another BB. And at sub-BV, an argument could be made there is value there?
Value's there and things definitely need to change, but in practice it'd be a regulatory nightmare that would take years to potentially fall through. Even carving out pieces could take decades.
No
No shot
Deposit cap is basically insurmountable short of explicit permission from regulators. The bar for that is quite high and shit management will probably never be a valid reason to be granted an exception.
80bn but not a behemoth??????? Please name 5 corporations (FIs and non-FIs) that could acquire a company for >80bn……..
I see where you’re coming from but I think a citi is far too large to be bought out
Berkshire, Visa, Mastercard, JPM, BofA. Obviously would be a regulatory nightmare but not a stupid premise or thought exercise.
What about PIF or some other SWF?
If Citi is a takeover target for anyone it is for some of the big tech companies. Apple, Microsoft or Alphabet would be my most likely buyers. Mostly because they need the financial services in house to get around the governments recent rash of acquisition blocking that has been going on.
It has gotten so bad there that it is honestly one of the biggest non interest rate drivers of the collapsing of the VC market. Despite everything else the current admistration has fucked up, this in my view is their biggest hit to the US economic engine. If VCs can't get capital turned over and the IPO market is losing its luster, innovation is going to come grinding to a halt due to a lack of capital access.
She's ruining Citi by... What?
Getting rid of unnecessary layers, simplifying structures? Woe is us for not having one guy look over both Markets AND IB!
What "woke nonsense"? Citi does not have any reservations about financing O&G apart from non-conventional & Arctic. Go read the ESP report. This is the same for every American bank. Shame about the Houston group, but you're being disingenous.
Elaborate further on "woke" nonsense because more often than not it's just some kid who's upset having to work with a black kid who came in through a Diversity scheme.
Citi has a long way to go, but it's not going downhill, and it's certainly not "finished". Dramaqueen.
Yeah totally agree with above. OP did not make really any real concrete points besides Fraser = Bad. I don’t get why simplifying the management structure is so horrendous. To me, it was always very confusing about who reported in to who. I also think the media has misreported this structure change too - it’s not some RIF of investment bankers across all levels, it’s more a shuffling of management.
That said, I don’t know any specific instances of them making questionable promotions. So OP if you know of them you need to back up your claims.
Concrete point one: Its a women - Duh
In all seriousness, I feel like Id tend to agree that simplifying the structure of a big bank is good step. At the same time I suppose something has to be going wrong if its been like this for a while, although I'm not sure attributing it to woke bullshit is the right move unless I see some more evidence
She has been culling BCMA which is a cash cow and focusing on other areas like consumer and wealth were Citi has no real heritage.
She is a former McKinsey consultant who knows nothing about BCMA and this decision to have Markets and banking directly reporting to her makes sense in theory but not for someone of her intelligence. Would love to sit in on conversations between her and Maths Phd Andrew Morton.
By virtually all performance metrics Citi is one of the worst banks and investors clearly don't believe in her ability to execute any value creating strategy, which is arguably all that matter.
Citi employee here - whilst I don't think she's the greatest, this comment is quite misinformed...
She's literally sold most of the consumer banks around the world.
Bruh, as much as we bankers like to jerk each other off, the plebs at TTS are the consistent cash cows in ICG. FI blows hot and cold, banking is probably a distant third or fourth.
Non-conventional at this point is where most of the deal flow in energy is
Yup, this right here. It’s all frac
Citi is by far the worst bank I’ve ever had the displeasure of working with
She literally refers to her shareholders as “stakeholders” which, if you know what’s going on, you know is revealing about how she looks at the business.
But based on your post I’ll be surprised if you don’t play dumb and act as though it’s nothing.
please elaborate. genuinely curious
Looks like we found Jane on here.
"Citi does not have any reservations about financing O&G apart from non-conventional & Arctic."
https://talkbusiness.net/2022/04/most-new-oil-gas-wells-drilled-horizon…
"In 2021, 81% of U.S. well completions were horizontal or directional"
Let's not sit here and lie about what that policy actually means. All in the same sentence you managed to claim that Citi doesn't have any reservations about oil and gas investing while saying that it is company policy to stay away from 81% of all new wells drilled in the US.
Go read the Environmental and Social Governance report that Citi puts out, or alternatively reach out to some O&G corporate banker.
The only O&G venture Citi (and almost every other bank) will not finance is unconventional oil.
Worked at Citi for 4 years and left shortly after Fraser arrived (I was in markets not IB)
I’d never seen such bloated dysfunctional bank with poor middle management spending all day stealing each other’s P&L…
if she can cut through that crap more power to her… won’t be done in a few years though
Citi is the epitome of the failed concept of a « universal bank » trying to do everything and being mediocre at most
at its core Citi is now a trade finance bank - that’s the recurring / low risk business that investors love, they have some very good groups here and there (p&u, aviation) but it just doesn’t have the DNA of a BB
Let's be real, Citi just sucks. Joke before the GFC and still a joke now 🤷🏻♂️.
Was waiting for someone to post on this... it's so mad how they're so bloated with so much middle management and yet they keep on firing / cutting the wrong people over and over again.
Unbelievably badly run - it's only time before they fall and get bought out. Has to be, it's trading at 0.44 price-to-book ratio.
>checks P/B on $C
>it's real wtf
>major US GSIB trading below half of book value
Um...guys...I kind of think people should be looking at this one
Hope wells Fargo buys them. Can be the ultimate chit bank for all the non targets that won't stop flooding my inbox. A special place on wallstreet for them to congregate.
That middle eastern money are very excited to put their hard earned petro dollars to make a mark in US financials. I don't fully understand why, but their SWFs want to make a move fast.
Agree with the sentiment. Citi has really struggled to find itself and this change really came out of nowhere. Several genuinely great people are being forced out and not really sure what value it will bring.
The bank hardly gets the basics right, a mixture of under investment and poor hiring strategies. I feel like it was a BB bank pre-financial crisis because of its balance sheet. The current talent now across IB and CB is dire, hardly any personality and dry (some in London struggle to speak English). I would describe the london office as a European bank. No issues with this, but we really struggle to win key deals based on the relationships some bankers have with clients. At the end of the day you need both intelligence and sound relationship to win mandates.
Regarding the woke comment…. I mean all the business heads are men and all but 1 are white men. I think you’re safe from the woke brigade 😂
Citi is only attractive if you are an EM employee looking for a better life. Stay long enough and you can move from Mumbai to New York. They’ll stick you on a work visa so you cant leave for x years. It’s an easy win for them.
I mean no not really on being insulated from woke because of white men, plenty of woke white men including the current POTUS lol
I used to work at Citi (London). There was a lot of woke nonsense (think I remember specifically for black history month our $1m a month black CFO sent round a firm wide email about how oppressed he was…) but I’m not sure that’s why it’s trading so badly. I suspect it’s more to do with poor retail and WM exposure and higher reliance on more volatile IB/trading revenue. Our financing capabilities were also really bad, we had a lot of risk management hoops in Europe to jump through that it seemed other banks didn’t have and were never able to offer competitive staples so we lost a lot of deals. I’m also not a FIG analyst and I never worked in New York where I suspect most of the money is made, so could be completely off.
IBD had layoffs today across multiple groups
.
What happened to the Citi houston group? As someone who has a good friend interested in energy trading, specifically in Houston.
Citi lost their rainmaker Steve Trauber and their head upstream took a bunch of people to Gugg. They haven't really been the same since.
Delete
You couldn't even have bothered to copy paste from ChatGPT without formatting?
So your old team was Securitization/GSP, then?
.
She didn’t take it down. It’s been a dumpster fire for at least 15 years.
They’ve been consistently top 3 in the M&A league tables since Citi moneywhipped Traub dog into leaving UBS in 2011 to run their Global Energy Group - wtf are you talking about??
You don’t get it. League tables don’t determine profitability. Moreover, banking doesn’t drive the banks’ revenues - it’s trading, specifically FICC. The company overall is totally mismanaged with mostly B and C talent. Here’s an easy way to know where your company stands: If you were an MD crushing it and therefore paid a huge part of your comp in citi stock with a rolling 4 year vesting period, how has it done in the last 3 years? 5? 10? 15? It’s a joke. Your little $250-300k total comp you may get in cash is nothing in determining the caliber of the company. And traders almost never get % payouts anymore because the bank need the money to pay something minuscule to the underperformers. If you have a % payout and an amazing P&L year, you’re more likely to get fired.
This post is absolute bullshit - sounds like OP is bitter because they will likely be RIFed. Fraser is eliminating a useless layer of management, and selling the businesses that aren't doing well. She's also getting rid of BS committees that just hold up deals. The only reason there is any disagreement about this approach is simply that people don't want to get fired or have to change roles because they prefer to remain in the same seats they've been for 30 years taking up headcount and producing nothing.
I have no idea what OP means by woke stuff. Citi regularly gets protested for "putting profits over the environment."
This thread has triggered several of us in the office so I'm summarizing the water cooler talk below. I try to avoid being duplicative to other comments on this thread but frankly some sentiments seem to be widespread.
First of all if you didn’t think Citi could go any lower, you’re dead ass wrong and it is NOT a value play. Make no mistake about it, Citi is absolutely going further downhill. Frazer’s leadership is abysmal. The energy franchise is merely the first data point in her short tenure as CEO. To allow that team - the ONLY IB team at Citi that consistently ranked in the top 3 of their respective sector - to disintegrate, says everything about her intentions. That kind of overall IB performance should be absolutely unacceptable for a bank the size of Citi, so doing anything other than protecting the good and fixing the bad is a God awful strategy.
But she’s a McKinsey brat dressed up as a Consumer Banker, and that leads me to my next comment. She has one-dimensional banking knowledge, lacks leadership acumen, and lacks the selflessness required to develop a comprehensive vision for a bulge bracket that’s in the best interest for shareholders. Instead, everything she does is self-serving and political in nature, to the point where she forces company strategy to conform to the current mainstream winds. Her anti-O&G rhetoric on day one of her CEO tenure? Political. Making us the first bank to mandate the COVID vaccine to all employees? Political. That last one was particularly hypocritical if not comical for a person who advocates “my body my choice” when it comes to women’s rights but conveniently temporarily suspended such beliefs by threatening termination to employees that did not show proof of vaccination by a specific date. Indeed, her guiding principles are her political aspirations and strong desires to be accepted into those inner circles, so whether you’re a shareholder or employee at Citi, it would be in your best interest to remember that as long as she’s at the helm. It will explain her every selfish move.
Which brings me to what happened in Houston. Everything that happened there was also borne out of individual selfishness:
Everyone points to losing Trauber as the melting point but to me it’s the combination of Tony and Mo that the guy the Houston office misses the most. They were both culture carriers that made the banking grind enjoyable every now and then. Fine, Mo left for more money and we’re a mighty bulge bracket with a balance sheet that can do the bulk of the business development in the absence of rainmakers. But in Tony we also lost our quality control. Our work product was simply superior when he was here (as evidenced by the Gugg guys plagiarizing it as soon as they got there, not to mention stealing our mandates with our own work), and as good as the team he left here is, it’s sadly rudderless and their work is uninspiring. Beyond the work product, he had the stones to keep our coverage team honest and that instilled credibility within the ranks. On the BD front, we are a laughing stock and don’t get invited to pitches anymore. In fact we learn about most deals by reading the same press releases that you read. That includes midstream deals, a particularly laughable statement considering we are overweight on midstream "studs” (as they call themselves). On a resource allocation front, the coverage bankers have lost the check-and-balance that he provided so now we burn treasured resources on garbage projects and we all know it. All of this has had team morale at a consistent low since his departure, and although management has recently acknowledged the void his departure created by replacing him with THREE directors to piecemeal his role, we are all very dubious that they will measure up to him. So much for “simplifying the management structure”.
Finally, the “woke” label is absolutely relevant and one of the posters here proves the point. To me, “wokeism” is a disingenuine or fraudulent show of concern for social and political issues, especially racism. By inundating their social media accounts with examples of Citi’s “activism” and quotes from minority middle management employees when in reality “all but one of their business heads are white men”, they embody the very definition of wokeness in a most manipulative and evil of ways. Further, the number of discriminatory infractions at the local level – whether documented or anecdotal – are frankly alarming and would be easily uncovered by any competent HR group...assuming they actually valued protecting employees more than protecting the woke smokescreen.
In conclusion, the Houston office self-destructed because individuals made selfish decisions and Fraser the politician selfishly watched it all unfold instead of intervening with an ounce of leadership. Yet as her passive role in allowing Houston to self-destruct showcases her calculatedly political astuteness, it also exposes her selfish ambitions and the nefarious lengths which she is willing to go through in order to achieve her political aspirations. Nothing she does is in the best interest of shareholders or of employees. Everything she does has a selfish and preservationist ulterior motive.
Remember that next time you think the stock is a value play.
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