Citigroup at Morgan Stanley Conference: Strategic Gains and Challenges

On Tuesday, 10 June 2025, Citigroup (NYSE:C) presented at the Morgan Stanley US Financials, Payments & CRE Conference 2025. The discussion, led by Viz Raghavan, highlighted Citigroup’s strategic gains in investment banking and its focus on financial sponsors and leveraged finance. Despite market anxieties over tariffs and supply chains, Citigroup remains optimistic about achieving its financial goals.

Key Takeaways

• Citigroup aims to increase its ROTCE to 10-11% from 7% in 2024 through revenue growth and capital optimization.
• The company is leveraging global reach and sector focus to drive M&A and market share gains.
• Market anxieties related to tariffs and supply chains are impacting client decision-making.
• Citigroup is partnering with Apollo to enhance private credit origination capabilities.

Financial Results

• Banking revenue is expected to rise mid-single digits year-on-year.
• Market revenue is projected to increase mid- to high-single digits year-on-year.
• Expenses are anticipated to rise by $200 million quarter-on-quarter.
• Cost of credit is expected to see an uptick of a few hundred million dollars in reserves.

Operational Updates

• Citigroup has pivoted strategically towards financial sponsors and leveraged finance.
• Investment in talent is focused on tech, healthcare, and capital markets.
• Geographic expansion targets include the UK, Germany, Middle East, China, Japan, and India.
• The commercial bank is being integrated, with a focus on North America to enhance mid-market investment banking.

Future Outlook

• M&A activity is expected to drive banking performance.
• Debt and equity markets may experience slower growth.
• Tariffs are a concern, with potential supply chain adjustments.
• The IPO market remains stagnant for companies with manufacturing or supply chain components.

Q&A Highlights

• Viz Raghavan praised Jane’s leadership and the bank’s progress in transformation and remediation.
• High-grade bond issuance has been a strength, linked to Citi’s balance sheet and capital deployment.
• The private credit market, with $2.7 trillion in AUM, presents significant opportunities.

Readers are encouraged to refer to the full transcript for more detailed insights.

Full transcript - Morgan Stanley US Financials, Payments & CRE Conference 2025:

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: we can. All right.

So thank you so much for joining us this morning. I have to read a disclosure For important disclosures, please see the Morgan Stanley Research disclosure website at morganstanley.com/researchdisclosures. Taking a photograph and the use of recording devices is also not allowed. This is meant to if you have any questions, please reach out to your Morgan Stanley sales representative. Okay.

Thank you so much. With that out of the way, we are delighted to have with us this morning Viz Raghavan. Thank you so much, Viz, for joining us this morning.

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Betsy, thanks for having us, and thanks for hosting us all here, and, pleasure to be here. Morning, everyone.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: And for those of you who don’t may not know Viz, Viz joined Citigroup last year as head of banking responsible for investment banking, corporate banking, and commercial banking. And he is also executive vice chair where Viz helps shape and drive firm wide strategy. Now, Viz, you are overseeing what I would call a renaissance in Citi’s investment banking businesses with share gains in several businesses. And I wanna dig into your management style before turning to the numbers. So off, what did you expect when you took this job?

And what did you see, and how did that compare with what you expected?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: So I’ve always admired Citi from the other side. I mean, they’ve been formidable competitors. You’ve, you know, come head to head with them on bake offs and client situations. And, you know, I I’ve I’ve seen some amazing deals happen, incredible idea generation and the like. So so I always admire Citi from from the other side.

And when I kind of look back on my own journey and you look at the banking landscape, you know, I felt Citi was kind of going through what every bank had been through in its kind of evolution, you know, consent orders, remediation, transformation, etcetera. Every bank has had, you know, its own version of it. And and in almost every instance, that institution has come out stronger. Jane’s leadership has been remarkable. The way, the progress the bank has made in kind of getting around a lot of the kind of the remediation actions, the transformation agenda has been truly, truly fantastic.

And what is also remarkable is the way the leadership team has set up the building blocks for success. So so you see a a kind of a a a compartment of progress that is really getting the house fixed and stronger. But at the same time, what Jane has mandated is the businesses need to really get going. It’s not kind of sequential. So while we are doing this, markets, banking, wealth, get going.

So so the strategy kind of really knits together. And then, you know, one of the kind of the key attractiveness of doing this has really been the kind of the just the scale of the of the bank. The geographical reach has been incredible, and it’s really been validated since I joined. It’s complete, and it’s global.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: Okay. So one of the reasons I wanna dig into this is because you do have some very interesting share gains, in particular in m and a, for many of the last several quarters, and ’24 was a really strong year, and 01/2025 was strong. And I’m sitting here thinking, what happened? Okay? What did you do differently?

And is this a function of bankers being pay you know, evaluated differently, paid differently? Is it a function of just hiring a lot more people? What’s driving this share gain?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: So hiring a lot of people, I mean, we’re just getting started in terms of talent investment, etcetera. But let me come back to to your point. It’s if you look at when I joined the the the market share before ’24, was around 4%. We ended up at four and a half percent at the end of last year. We had around 5.3%, you know, in the quarter gone.

The gains last year were really driven by high grade bond issuance. The whole investment banking market benefited from you know, this was up to elections. You saw a lot of corporates, prefund, etcetera. So there was a a torrent of high grade issuance, some acquisition financing, which was kind of brought forward. And high grade typically tends to be what we call a bit more flow.

So it is, you know, it has always been Citi’s strength. It is linked to balance sheet. It’s linked to capital that you deploy with clients. And and effectively, you have, you know, a high grade bond issuance. It’s kind of a byproduct of that plus, you know, in this instance, clearly, with a lot of, you know, given elections, etcetera, folks wanted to kind of, you know, take money and and access the market.

So we were a beneficiary of that. That played entirely to what I always thought was, you know, a Citi’s kind of really strong kind of competency. The bit that Citi kind of missed out on historically, and and there’s some math to it, which I’ll come to later on, was since the financial crisis, that entire financial sponsor boom and the leverage finance boom, Citi didn’t partake in as strongly as some of the other banks did. So, you know, financial sponsors, for instance, grew AUM from, I don’t know, around 2,000,000,000,000 to around $1,213,000,000,000,000 today. That and and during that process, they bought, sold, bought, sold, financed, refinanced, and that entire boom was incredibly lucrative for the banking industry that Citi didn’t play in, in part risk appetite because, you know, the crisis on the back of the last leverage finance kind of boom was not, you know, particularly happy, you know, landing for for the whole for the whole street.

And, also, you know, clearly, I think from a risk appetite point of view, you know, there was a general kind of retrenchment. What we did was if you look at the AUM of this community, they have $2,700,000,000,000 of firepower waiting to be deployed. If you look at any year, the of the overall no. Investment banking is $80,000,000,000 of a fee pool plus or minus 10%. And that’s kind of except for ’21, that’s kind of been the steady state.

Sponsors, left win, etcetera, account for between a quarter to a of the fee pool. If you look at Citi’s rankings, they rank, I don’t know, top five in investment banking fees. But if you look at Citi’s rankings historically in sponsors and left fin, it’s nine or 10. So in other words, if you’re top five, while not even addressing a quarter to a of the fee pool, just point to how potent that corporate the core franchise is. And all you have to do is if you modulate and you just become top five in the sponsor or left win community, there’s a mathematical inevitability where your overall ranking has to be top three.

By doing what you’re doing, continue to do, keep doing that well, and step up in this kind of the rest of the bucket. And that’s kind of been proven because if you look at this quarter, you know, KKR made two acquisitions. We advised Silver Lake and financed them on the Altera purchase. We advised Boeing on the sale of Jefferson that We advised Boeing there, and then through the Apollo JV financed, you know, and Blackstone came along and financed Tomah Bravo.

So suddenly, that pivot to m and a sponsors, Leffin, and that to me has been really reassuring. I thought that will take longer, but that muscle memory is there, and we were able to do that.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: So while we’re on the private credit discussion, can you help us understand how you’re set up for that industry group, if there’s anything else besides that? And in addition, can you give us some more color on your partnership with Apollo and the opportunity set that you see there?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: So the point I’d make is private credit is mainstream. So it is no longer a kind of an exotic kind of, you know, by the buy. If you have kind of pillars or pillars in the capital stack and all the way from, you know, senior, you know, down their debt spectrum, you know, mezz, you know, and then equity, private credit is a very kind of a a key pillar now. And when we are looking at a capital structure, effectively, that is part of the overall offering. The key point, if you look at most of last year, there was simply no arbitrage between public markets and private credit markets.

So the both markets were super competitive. They both markets were looking for opportunities to invest. There were not that many. And as a result, you know, there was abundant liquidity in within public, you know, public debt or in private credit. And that’s kinda still true, but what you will see is, you know, that arbitrage will will come back in.

And that arbitrage really comes on the back of covenants. You know, one is kind of buy to distribute and maybe hold a bit as opposed to buy to hold, maybe till till maturity, mark to market, etcetera, cover lights, you know, so different nuances that make each attractive. The the key kind of point here is the private credit market is not does not have a liquidity problem in that there is a wall of money waiting to be deployed. So for banks to commit scarce RWA, ring fence that to create further pools of liquidity when the market is not suffering from a liquidity problem, it is really a supply problem. And everyone is kind of loves to kind of showcase, you know, I’ve got x billion, you know, you’ve got y billion to kinda say, I’ve got that firepower or dry powder.

The dry powder, there’s an abundance of that. What the market lacks is supply, which was the reason Apollo wanted to team up with us because they wanted to partake in the origination in in providing that supply for that wall of liquidity. And for us, what it does is you don’t have to commit RWA. You don’t have to ring fence, you know, equity, etcetera. But if something is indeed you like it so much, there’s nothing preventing Citi from owning it in our trading books or, you know, credit books or whatever it is.

So it was really a a very symbiotic partnership where you could lean on to this $25,000,000,000 of firepower. You could you know, you you we have already worked with Apollo really well historically, and we also can bring others along. So in the Jefferson instance that I talked about that Boeing the asset Boeing sold, it was Blackstone and Apollo that came together to provide the to provide the financing. So in in short, it’s a it’s a key part of the capital stack. It’s here to stay.

You’re gonna see more, you know, private public kind of get together. And what you will see is, a a kind of a a a real kind of drive where, you know, companies will choose. And this will go beyond sponsors, etcetera, to even corporates that may go down that route. So

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: And so coming back to the talent that you mentioned, you’re still acquiring, I wanted to understand, are there any other areas globally or product wise that you’re looking to build out further?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: So of all, I think the bench So in terms of the talent at Citi, very tenured. I mean and all these, you know, left wing deals I described for instance. I mean, some of the team go back to the Solomon days. They’ve seen multiple cycles.

They have bridge, syndicated, underwrote, you know, distributed multiple multiple transactions. And it was just remarkable. You know, if you look, four of those transactions were post liberation day. So not exactly, you know, conducive, you know, markets, a lot of volatility. We managed to kind of, you know, dissect it and underwrite it and and and and distribute it incredibly well.

So a a lot of pedigree and talent within the system. There are pockets where we have wide spaces where we will continue to build and and invest in. In terms of the priorities, I think, tech health care are are are here to stay. I think the action, you know, between industrials, technology, and health care, it’s, you know, close to between 50 to 60% of the fee pool is is in those sectors. When I when I say industrials, even industrials are adjacencies.

So in other words, industrial company wants to buy in tech or in software or or the like. So those are key focus areas. We’ll continue to invest in the capital markets, you know, left in businesses, and really kind of really add more bench strength and and and capability. And likewise, geographically, UK, Germany, are kind of key. You know, The UK is a quarter of the, of the European or the EMEA market.

Middle East is really getting a lot of traction. That’s been historically a super strong source of strength for Citi. You know, there’s a there’s a lot of, you know, tenor and and, you know, a goodwill. And and then clearly, you know, China is is gonna prevail and stay relevant in in in whatever form. And then you have Japan that is really getting reignited now as corporate Japan looks to, you know, focus, streamline.

So I think Japan Japan will be a key part of the IV wallet, and then India is a is a net beneficiary of all of the, the stuff that is that is going on. Just one one other point I would I would highlight is the middle market. So the Citi’s commercial bank is is really, really good, and, clearly, our investments are now gonna be mainly NAM North America focused. And the idea of building the commercial bank, yeah, to greater strength here and marrying that and partnering tie you know, more closely with the mid market kind of investment banking franchise is gonna be incredibly is gonna be it it’s gonna be incredibly busy. It’s gonna be incredibly fruitful.

Also because the sponsors love to play in that segment of the market because, you know, the the the 2,700,000,000,000.0 of firepower I talked about because that’s the 1 to 5,000,000,000 deal size is is perfect for that. So

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: And it’s been a volatile year, obviously, turning to the environment, if we could, just having had the tariff scare and then the tariff pullback. And where are your clients now? What are you seeing today, and what kind of conversations are you having with your corporate clients on opportunities for growth and execution?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Look. There there is, you know, I I you know, stating the obvious. There’s a lot of uncertainty out there. Folks, if you you know, through our corporate bank, which is is probably the best corporate bank out there, we get incredible real time intelligence on the mood and boardrooms globally, you know, what client how clients are looking at tariffs, their supply chains, and the like. And and and, look, there is there is a lot of anxiety.

The sense we get is at 10%, which almost feels like a floor or a baseline tariff between 20%, Folks are thinking, can I absorb this? How do I absorb this? And and basically, you know, put it down to kind of, you know, my cost of goods sold. Anything higher than that, the question is, you know, how do I regen my supply chains and the like. And all of this really plays into Citi’s geographical reach, footprint, etcetera, because this this is talking about, you you’re talking FX hedges.

You’re talking about trade finance. You’re talking supply chain. You’re talking about, you know, how do I, you know, how do I, make sure that I’m not putting all my eggs in one basket and I’m kind of re re jigging, redistributing my my, you know, my business model. And a lot of advice in in terms of, you know, what all of this means for, you know, my my global footprint and my and my global network. So point one, anxiety, and and bracing oneself for further uncertainty.

To give you an example, the what investment banking likes is clarity. So either it’s really bad or really good, whatever it is, just give us the news. But it is that middle area of not knowing that really freezes market activity. Give you an example. In April, in debt plus equity financing, there was about 1,600,000,000.0 of, you know, of fees.

And the run rate in debt and equity financing is around $3,800,000,000 a month. And that lack of so April just you know, everyone froze. Everything was on pause hold. We got we had cross border deals. The board had approved.

And the night before, the board goes, we don’t have to do anything. You know? We don’t have to do it now. Let’s pause. Let’s revisit.

So it’s that an it is that that is what kind of, you know, the freezing is what, you know, you know, worries us. On the products, m and a continues to be super active. There’s a lot of dialogue, lot of engagement. And I go back to the sponsor firepower because they are a big driver of that too in addition to corporate m and a. And and and in corporate m and a, what kind of really pleases me about Citi is just the quality of the deal flow.

So if you’ll take last year, you know, the largest M and A deal was Mars buying Kelenova. So we advised and financed Mars. This year is Charter Cox. So Citi is in Charter Cox. We talked about, you know, Boeing, Jefferson.

We talked about Silver Lake, Altera, CD and R buying Sanofi’s assets. So just the quality of you know, these are the best of the best deals that are happening in the market, and it’s really reassuring that, you know, Citi is is featuring in all of that. Just one two two final points. The financing market, the debt market is gonna be more of a function of how the m and a market manifests itself because there’s gonna be little by way of just pure flow Mhmm. But more by way of acquisition financing and the and the takeout, even though there’s a wall of maturities waiting for redemption from the 2021 financing boom.

But that’s kinda more 2627. In equities, the IPO market, the IPOs that are getting done, and we’ve seen a few, have been ones where there is less if I can use the word, less of a cost of goods sold, question mark. So in other words, to the extent you have any kind of geo geography, tariff, supply chain, cost of goods sold model. The question is how do you, with clarity and certainty, put out a three year forecast on this is how I’m gonna do, so give me this valuation. And so what are you seeing as deals like in tech, in in digital assets, etcetera, which are really kind of, you know, you know, we we had some recent deals that have done really, really well.

But, generally, the minute you put in a you know? So that IPO market is kind of a bit stagnant to the extent that there is a manufacturing or a supply chain aspect to it, Which means what happens with those assets, some of them are sponsor held, is do they go in an m and a route? So do they go p two p? Does does a strategic come and buy them? And and that that and and that will once again feed back to the m and a company.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: So I’m hearing there’s a little bit of unlock going on relative to where you were in April. Is that fair?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: It is. I think you you April was was was quite, you know, at the you saw the stats. I think you’re seeing a bit bit more, you know, of, you know clearly, valuations are back at, you know, preliberation day kind of levels. You know, macro, we can’t we don’t have time to go through it there, but then you see the equity market, credit market kind of in a bit of a disconnect, etcetera. But in terms of volumes both in primary and secondary, I think you are it’s healthy now.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: So can you give us a sense as to how the quarter has been trending so far? 2Q twenty five is, pretty close to done. How has that been for banking and trading?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: So let me start with banking. So I laid out the context. So clearly, m and a is is is the catalyst in the wild card. I think debt and equity is slower. So overall, in banking year on year, we expect to be up mid single digits.

If you take markets, the activity both across the FI and the corporate space has been strong. Also, FICC and equities, have been strong. And year on year in markets, we are expecting to be up in the mid to high single digits. Clearly, we are still early in June. There are a few weeks still left to go.

On expenses, clearly, Mark, guided, last quarter. As, you know, as he mentioned, you know, this quarter, expenses are likely to tick up around 200,000,000 for this quarter, quarter on quarter. But overall, full year, expenses will be we expect to be in line with, with with guidance. And then finally, on on cost of credit, once again, you know, given the macro environment, etcetera, cost of credit compared to last quarter, we expect to be up a few $100,000,000. Once again, this is, you know, this is reserves.

And once again, on cost of credit, a lot of the work is currently still being done. We are we still have, you know, a few more weeks to go, this quarter. But on on the credit overall, I am incredibly reassured on the quality of the credit book. So if you take corporate exposures, over 80% or 80% or thereabouts of our corporate exposures are high grade. If you take our international exposure, 90% or thereabouts is is high grade, or it is exposure to subsidiaries of, you know, multinational, you know, corporations.

So a lot of comfort. And then, as you know, our, you know, our card, books skews prime. So, you know, overall, you know, a lot of kind of comfort on the quality of the, of the exposure of the of the credit report.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: Okay. So just putting it together one more time, if you don’t mind, for folks who might have missed that. So you’re banking year on year?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Up mid single digits. Okay. Markets, year on year, up mid to high single digits. 200,000,000 up quarter on quarter in expenses, but expect to be in line with full year guidance for expenses.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: And that’s for the whole company?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: For the company.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: Right.

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: And then you have, cost of credit is a few $100,000,000 upon loss last quarter in reserves. This is just reserves.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: Right. So provisions is up q on q due to reserve build. Correct. Okay. While we’re on credit, could I just ask your opinion on the lending to other lenders?

So also known as nondepository financial institution lending. And we get a lot

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: of questions from investors on how should we think about the credit cost associated with nondepository financial institution loans. I think you you you have to look at, you know, as with every loan, you have to look at it in the context of, you know, the the firm’s cost of capital, the excess return that that capital generates, and then the opportunity cost of deploying that capital. And this is something which we have you know, when when you you one of the questions you asked earlier was, you know, metrics have you put in that are are different? And and and and NBFIs are very much you know, whether it’s a corporate NBFI or whatever, the overriding mindset, and and this is something which internally is also a cultural shift, is the if I if I take if if you are a banker and you’re making $30,000,000 and your fee pool is a $100,000,000

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: What’s the name of that banker?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: No. So if you’re if you’re making a revenue of no. I’m not not making comp on $30,000,000. I meant revenue of

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: Okay.

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Thank you

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: for clarifying.

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Banker that’s making $30,000,000 revenue with a client, and the client is a $100,000,000 fee pool, then I bow to you. If you’re a banker that makes $30,000,000 and the fee pool is a billion dollars, then you’re leaving a lot of money on the table. In both instances, you may meet your bogey or your hurdle or whatever, 15%, whatever the number is, and basically justify that credit that you’re extending, whether it’s a corporate or a financial institution, MBFI, any any, you know, any kind of the firm. I think the discipline that is we are really now embedding in the organization is it is not just absolute. You cannot look at 30 in a vacuum.

It is 30 in the context of the entirety of the opportunity. And the entirety of the opportunity is linked to what is that fee pool that the client is, you know, is and the and the and the street is partaking in. And the very important thing that ties back to your question, NBFI or otherwise, is when you look at that $30,000,000, a banker that generates 30 bill 30,000,000 of revenue and has a 2,000,000,000 lending outside outstanding to a company, that 30,000,000 is not the same as a banker who creates $30,000,000 of revenue with a client with no capital outstanding to the company. So in other words, that and and and I think the street and a lot of banks sometimes just have a revenue focus. The pivot has got to be revenue less cost of that revenue, which is really a bottom line ROTC focus.

And that is something culturally we are really, really driving our guys to is what is the bottom line so that the marginal opportunity cost of every dime or dollar of capital you deploy is perfected to the entirety of the people. So and and that’s when you have to make capital allocation decisions to see, okay, where is the best excess return for that dollar of capital you deploy. So that’s a that’s a that’s a big focus right now. So

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: So, Biz, thanks for bringing up ROTCE, because that brings us brings me to my next question. As I think we all know around the room here, Citigroup has a goal for ROTCE driving that up to 10 to 11%, I believe, right, in the next year or so, couple of years in the medium term. And I’d be interested in understanding where the drivers are for you and your business to help contribute to that because I I think the ROTCE in your business was around 7% in 2024. And I know Mark said, hey. This should get to a bit under 15.

That’s a doubling. So how do you do that? What’s the plans, goals, time frame?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: So, look, I think all all of the above in terms of what we’ve discussed so far. But let me let me kind of quickly you know, a couple of key points there. One

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: We have seven minutes. You don’t have to be

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: too quick. The the the other a couple of couple You know, it’s the numerator and the denominator. So let’s talk about the numerator Mhmm. One is earnings momentum driving revenue growth, and, basically, this is really gonna come through share gains in investment banking.

And there is a portion of that is the inevitability piece I talked about. So we are top five globally. You are nine ten in pockets, which is sponsors less than. We don’t we gotta grow less than responsibly. So you know, because this is this is typically, you know, sub investment grade, etcetera, etcetera.

We will grow that. If we even get back to a top five landing with with that grouping and we preserve and do better with our core corporate franchise, there is mathematically an inevitability where we should aspire to be top three. So one. I think the point is in pockets which are gonna be very defining going forward. So sectors I talked about, tech, health care, industrials, which is a core strength of cities, and then a whole bunch of others where, you know, Citi is is very, very credible.

So we’ll keep investing and growing there. Geographically, North America is a is a key key market. Let me give you an example in corporate banking, for instance. Citi’s geographical depth and spread in terms of servicing clients is is incredible. So we are in remote locations.

We are in countries because multinationals, American multinationals, European multinationals want us there. So we are servicing their needs there. Typically, these locations are more difficult to navigate. There’s KYC, AML, and a whole bunch of, you know, other costs, etcetera. And the reason we are there is because our clients want us to be there.

What we cannot have is clients giving us business in those markets, and we accept that as a reward. The the reward is the easy, juicy g seven markets, you know, dollars in The US, euros in Europe. And what you cannot have is we are sitting there servicing their needs because they want us there in these far flung locations, and then the easier stuff goes elsewhere. And I think we need to bring together the opportunity is and this is a big focus for us, is that global network inbound into the, you know, the the the easier what I would call, you know, the easier Well markets per se in corporate banking.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: This brings up a really, a question a lot of people are asking today in our multipolar world as we shift towards this or as we’re in it now. How are you dealing with customers who might be leaning to an institution that’s headquartered locally? Are you finding any of that dynamic entering the conversation?

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Absolutely. And this is a huge strength for strength for Citi because Citi is global, but in a lot of these countries, it’s it’s it’s centuries old. It’s kind of local local. It’s embedded in the fabric of, you know, of, you know, of these countries and the corporations within within these countries. And what you are seeing now is that know how as you reroute supply chains, as you diversify, as you are rejigging your thinking, that know how is incredibly valuable.

And that leads to you know, before if it was unipolar flows, maybe dollar alone, you’re now seeing cross currency, multipolar flows in currency, whether it is in hedging, whether it’s in swaps, whether it is, you know, custody custody of assets. And all of this really plays to Citi’s strength because it really knows these markets. So our value added in terms of educating clients and you’ve seen this already, just in understanding what you know, there there is a in just in terms of clarity, what clients are seeking around, you know, leaning on each other, you know, wanting to find out more. They’re really they’re relying on the Citi intelligence infrastructure to really get a handle on what are others doing. You know?

What how easy is it for me to, you know, reroute this into India? And Citi is one of the the leading banks in India. So you’re saying, hang on a This is what we can do for you. So those discussions are, as you know, exactly to your question is been before they were maybe unipolar, those are multipolar. And not everyone can play those those other kind of, you know, adjacencies.

So that’s a huge strength. Just going back to your question again on how are we gonna turbocharge returns because I wanna come to the denominator too. And then the other point clearly is really on the commercial bank, the middle market, once again, focusing to NAM is gonna be a key piece. And in in all of this, this is really ownership, accountability, you know, getting a a mindset for excellence, and and really getting the muscle memory back of winning again and again and again. And in the denominator, you know, clearly, we will get there will be a transformation dividend.

You know, there’s good progress being made there, and I think, you know, a lot of that

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: A transformation dividend.

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Yeah. Because you will you know, the firm will come strong become come out stronger on the back of that. Mhmm. You know, already you’re seeing the, you know, the business lines are are are super are super joined up. There is a a a very tight, high quality leadership team that Jane has put around with very clear visibility, lines of responsibility.

There is nowhere to hide. And and the and the key is, you know, the expenses that are being when I say that when I talked about transformation dividend, a lot of those expenses will gradually kind of, you know, tail off as, you know, we, we remediate and and and and deliver. And and and also on capital, we are optimizing. So we are really looking at excess return, how much, you know, extra return that capital is is is getting. And and clearly, as we grow, we will use more, but we will also return more on the capital we deploy.

So it’s both. So we’ll it’s really work on both sides. You know, one is the numerator in terms of, you know, revenue, and earnings momentum and then clearly optimizing, you know, capital in the in the in the denominator.

Betsy, Morgan Stanley Sales Representative/Host, Morgan Stanley: Okay. Excellent. Well, thank you so much, Viz, for joining us this morning.

Viz Raghavan, Head of Banking, Executive Vice Chair, Citigroup: Thank you.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.