Citigroup mulls plan to remove leadership layer at its largest unit - source
By Tatiana Bautzer and Saeed Azhar
NEW YORK (Reuters) -Citigroup is considering plans to eliminate the role atop the bank's biggest division when its leader, Paco Ybarra, leaves next year and have its three segment chiefs report directly to Citi's CEO, according to a source familiar with the situation.
Ybarra, who has been at Citi for 36 years, is head of its Institutional Clients Group (ICG), and that position would no longer exist under the reorganization, the source said on Monday. Instead, the leaders of investment banking, global markets and transaction services would report to CEO Jane Fraser.
The plans, reported earlier by the Financial Times, are under consideration and not finalized, the source said. Citigroup (NYSE:C) declined to comment.
Citi has been working to simplify its structure. Analysts debated if such a move would add risk to Citi's revamp, or conversely provide Fraser with more control over the bank's direction.
Fraser, who inherited a litany of problems when she took over in 2021, including demands from U.S. regulators to overhaul its risk management systems, has been trying to boost Citi's share price, in part by shedding overseas retail businesses.
«It does make you wonder (whether) having that extra layer of management was indeed unnecessary, or it may raise the odds of execution risk if having that extra set of eyes on the whole unit was indeed valuable,» said Eric Compton, banking analyst at Morningstar.
«It goes to show that Citi is still figuring out pieces of this as they go along.»
The ICG unit provides financial services to institutional investors and governments. It generated more than half of Citi's $19.4 billion revenue in the second quarter.
The division's leaders include Shahmir
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