Slides
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Citi’s Wealth Business Update Andy Sieg Head of Wealth February 12, 2025
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Wealth is core to Citi’s path to deliver sustainably higher returns 2 USPB Markets Services Banking Wealth Citi Wealth Today ✓ Source of high returning, capital-light, recurring, fee- based revenue ✓ Presence in 4 geographies with significant cross- border flows ✓ Integral partner to Citi’s Institutional businesses ✓ Delivered strong organic growth and positive operating leverage in 2024 Importance to Citi Citi Private Bank Citigold Wealth at Work Customized solutions for ultra high net worth1 (UHNW) clients Branch-based investments and banking in the US, HK, SG and UAE Investments, banking and lending for professionals in the workplace Note: All footnotes are presented in the appendix
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3 Delivering strong operating leverage and improved returns 981 622 712 767 769 756 1,042 4Q’23 1Q’24 1,047 2Q’24 1,233 3Q’24 1,247 4Q’24 1,664 1,693 1,814 2,002 2,003 +20% $ millions Total revenues +20% YoY; Investments revenue +28% YoY5 1,623 1,642 1,542 1,601 1,570 4Q’23 1Q’24 2Q’24 3Q’24 4Q’24 (3)% $ millions Expenses (3)% YoY 0.6% 5.3% 6.4% 8.5% 10.1% 4Q’23 1Q’24 2Q’24 3Q’24 4Q’24 +9.5 pp Return on Tangible Common Equity (RoTCE) +9.5 pp YoY6 Net Interest Income Non-Interest Revenue 14.1K 13.6K 12.7K 12.5K 12.3KHeadcount Revenues $7.5B Client Balances1 $1,048B Clients 4 628K Investment Assets2 $587B Net New Investment Assets 3 $42B Headcount 12.3K Wealth full year 2024 results Note: Totals may not sum due to rounding; All footnotes are presented in the appendix
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Driving results through greater front-line productivity and balance sheet efficiency 4 Investment revenue per advisor1, $ millions 2023 2024 1.0 1.3+36% Improving our front-line productivity 51% 56% 2023 2024 +5 pp Client investment assets2 as a % of total client balances3 Prioritizing the right mix of client balances Improving deposit Mix Instilling pricing discipline Driving investments growth Deposits Capital efficient structuring Relationship- based Lending Lending to support investments Lending Mindset ✓ Proactive client engagement ✓ Holistic advice and actionable recommendations Skillset ✓ Advanced investment training ✓ Robust support model (e.g., specialists, data) Toolset ✓ Modernized advisor tools enabling holistic client views Note: All footnotes are presented in the appendix
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Well positioned to capture the global Wealth opportunity 5 NNIA3 as our North Star Driving connectivity between Wealth and other businesses; leveraging Citi’s scale and personnel across the company Technology Enhancements Power of One Citi Advice as our “product,” delivered through a robust suite of solutions and modern technology Modernizing technology platforms, data and tools to deliver personalized advice & enhanced client experiences …and we are focused in the right areas Note: Left graphic sourced from Bain & Company. Totals may not sum due to rounding; All footnotes are presented in the appendix Growth in global wealth is unprecedented…1 Liquid assets2, $ trillions 73 115 38 71 22 37 3 2021 6 2030 137 229 CAGR 5.9% 5.2% 7.1% 5.8% 7.1%NAM APAC EMEA Other
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Near-term focus on deepening with existing clients and improving revenue mix 6 ~$5T opportunity to deepen with current clients ~$5T (85%) ~$1T4 (15%) Estimated existing client investable wallet ~$6T3 Off-us1 On-us2 NNIA as our North StarTechnology EnhancementsPower of One Citi Note: All footnotes are presented in the appendix Opportunity to improve revenue mix Peer median6 33% ~65% ~2x 1H’24 investment revenue as a percent of total revenues 5
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NNIA as our North StarTechnology EnhancementsPower of One Citi North America U.K., Europe • Private Bank • Wealth at Work and Middle East • Private Bank • Citigold and Africa • Private Bank • Citigold • Wealth at Work • Private Bank • 6 Retail Branch Markets: NY, DC, MIA, CHI, SF, LA Leveraging Citi’s full platform across geographies Note: Totals may not sum due to rounding. All footnotes are presented in the appendix Latin America • Private Bank Japan, Australia, Asia North, and Asia South • Private Bank • Citigold Corporate & Investment Banking Commercial Banking U.S. Personal Banking Wealth ~640 Branches Product offerings in ~20 countries, and ~1.7K Wealth advisors3 Corporate Bankers serving clients in >130 countries Commercial Bankers serving clients in >80 countries Markets Trading floors in ~80 countries Businesses tied together by “Integrated Client Engagement” team Citi serves ~560K Citigold clients and ~50K Wealth at Work clients. Citi’s Private Bank serves ~14K HNW1 and UHNW2 clients UHNW clients’ average net worth is ~$500MM 4 Private Bank Geographies 7
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8 Modernized data structuring and technology capabilities enhancing client and advisor experiences Outcomes: Tech Focus Areas: Enablers: Industry leading talent and 3rd party partnerships with top technology companies Data automation/ Synchronization Machine learning Generative AI Modern CRM1 • Cloud-based data architecture • Unified single source of client and security reference data • Machine learning techniques driving hyper- personalized client advice Personalized client advice Advisor capacity to engage clients • Intelligent advisor assistant (Next Best Action) • Using AI to streamline administrative client management tasks • Enhanced data visualization and dashboards to manage client relationships NNIA as our North StarTechnology EnhancementsPower of One Citi Note: All footnotes are presented in the appendix
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Advice-driven investments growth 9 ✓ Client-centric, not product-centric investment advice ✓ Open architecture, prioritizing curation and access over “manufacturing” ✓ Product innovation partnering with industry-leading asset managers ✓ Advisor access to third-party investment partners increasing advisor/client engagement ✓ Growing fee-based revenue ✓ Growing and scaling alternatives business NNIA as our North StarTechnology EnhancementsPower of One Citi 6 3 10 14 16 4Q’23 1Q’24 2Q’24 3Q’24 4Q’24 Net New Investment Assets (NNIA)1 in $B Positive asset gathering momentum… … leading with advice as our core offering Near-term opportunities ✓ Expanded product and capability suite ✓ Enhanced end-to-end investment experience $42B representing ~8% organic growth2 in FY’24 Note: Totals may not sum due to rounding; All footnotes are presented in the appendix
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• Deposit pricing discipline • Fee based investment revenue growth • NAM growth 10 2026 targetFY 2023 3.1% FY 2024 7.6% 15-20% >20% Driving towards higher return targets Long term targetRevenues • Continued expense discipline • Infrastructure automation and simplification • RWA productivity • Loan growth tied to Investments Expenses Capital Return on Tangible Common Equity (RoTCE)1 4Q 2024 10.1% Note: All footnotes are presented in the appendix
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Certain statements in this presentation are “forward -looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. These statements are not guarantees of future results or occurrences. Actual results and capital and other financial condition may differ materially from those included in these statements due to a variety of factors. These factors include, among others: (i) geopolitical, macroeconomic and other challenges and uncertainties globally and in the U.S., including, among others, changes to trade, immigration, energy, and other policies resulting from the new U.S. administration and Congress; changes in interest rate policies or in economic growth and unemployment rates, any resurgence in inflation, the Russia-Ukraine war and conflicts in the Middle East; (ii) the execution and efficacy of Citi’s transformation, simplification and other priorities, including those related to its investment, expense, capital and other revenue-related actions; (iii) the potential outcomes of the extensive legal and regulatory proceedings, examinations, investigations, consent orders and related compliance efforts and other inquiries to which Citi is or may be subject; (iv) ongoing regulatory and legislative uncertainties and changes, including changes in regulatory capital rules, requirements or interpretations; and (v) the precautionary statements included in this presentation. These factors also consist of those contained in Citigroup's filings with the U.S. Securities and Exchange Commission, including without limitation the “Risk Factors” section of Citigroup’s 2023 Form 10 -K. Any forward-looking statements made by or on behalf of Citigroup speak only as to the date they are made, and Citi does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made. 11
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Appendix 13
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Wealth returns reconciliation 14 Average Allocated TCE (in billions of dollars) (1) 4Q23 1Q24 2Q24 3Q24 4Q24 FY 2023FY 2023 FY 2024 Services $23.0 $24.9 $24.9 $24.9 $24.9 $23.0 $24.9 Markets 53.1 54.0 54.0 54.0 54.0 53.1 54.0 Banking 21.4 21.8 21.8 21.8 21.8 21.4 21.8 Wealth 13.4 13.2 13.2 13.2 13.2 13.4 13.2 USPB 21.9 25.2 25.2 25.2 25.2 21.9 25.2 All Other 32.4 25.6 27.0 29.2 29.5 30.6 27.6 Total Citi average TCE $165.2 $164.7 $166.1 $168.3 $168.6 $163.4 $166.7 Plus: Average goodwill $20.4 $19.6 $19.5 $19.6 $19.4 $20.1 $19.8 Average intangible assets (other than MSRs) 3.8 3.7 3.6 3.5 3.6 3.9 3.6 Average goodwill and identifiable intangible assets (other than MSRs) related to assets HFS - - - - - 0.3 - Total Citi average common stockholders' equity (in billion of dollars) $189.4 $188.0 $189.2 $191.4 $191.6 $187.7 $190.1 (in billions) 4Q23 1Q24 2Q24 3Q24 4Q24 FY 2023FY 2023 FY 2024 Citigroup Net Income (in billions of dollars) (1.8) 3.4 3.2 3.2 2.9 9.2 12.7 Less: Preferred Stock Dividends 0.3 0.3 0.2 0.3 0.3 1.2 1.1 Net Income Available to Common Shareholders $(2.1) $3.1 $3.0 $3.0 $2.6 $8.0 $11.6 Net income to Common (2) (in billions of dollars) 4Q23 1Q24 2Q24 3Q24 4Q24 FY 2023FY 2023 FY 2024 Services $0.8 $1.5 $1.5 $1.7 $1.9 $4.6 $6.5 Markets (0.1) 1.4 1.4 1.1 1.0 3.9 4.9 Banking (0.3) 0.5 0.4 0.2 0.4 (0.0) 1.5 Wealth 0.0 0.2 0.2 0.3 0.3 0.4 1.0 USPB 0.2 0.3 0.1 0.5 0.4 1.8 1.4 All Other (Managed Basis)(2) (2.6) (0.7) (0.6) (0.8) (1.4) (3.4) (3.4) Reconciling Items(4) (0.1) (0.1) (0.0) (0.0) 0.0 0.7 (0.2) Citigroup (2) Net Income to Common $(2.1) $3.1 $3.0 $3.0 $2.6 $8.0 $11.6 Wealth net income (in millions of dollars) $21 $175 $210 $283 $334 $419 $1,002 Wealth average allocated TCE ((from above) in billions) 13.4 13.2 13.2 13.2 13.2 13.4 13.2 Wealth RoTCE (3) (Wealth net income / Wealth average TCE) 0.6% 5.3% 6.4% 8.5% 10.1% 3.1% 7.6%
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All Other Net Income Reconciliation 4Q24 3Q24 2Q24 1Q24 4Q23 2024 2023 All Other Net Income (Loss), Managed Basis $(1,070) $(483) $(402) $(477) $(2,300) $(2,432) $(2,141) Add: All Other Divestiture-related Impact on Revenue(1) 4 1 33 (12) (62) 26 1,346 All Other Divestiture-related Impact on Operating Expenses(1) (56) (67) (85) (110) (106) (318) (372) All Other Divestiture-related Impact on Cost of Credit(1) - 1 3 (11) 30 (7) 67 All Other Divestiture-related Impact on Taxes(1) 16 20 17 39 27 92 (382) All Other Net Income (Loss), (U.S. GAAP) $(1,106) $(528) $(434) $(571) $(2,411) $(2,639) $(1,482) 15
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Footnotes Slide 2 1) Citi defines Ultra High Net Worth (UHNW) as clients with investable assets of greater than $25MM Slide 3 1) Client Balances includes EOP Deposits, Loans, and Client Investment Assets 2) Year end 2024 is preliminary. Client Investment Assets includes Assets Under Management, trust and custody assets 3) Beginning in the fourth quarter 2024, the metric previously reported as Net New Assets (NNA), which included both Net New Deposits and Net New Investment Assets, was replaced by Net New Investment Assets (NNIA) to align metric with the strategic priority of the Wealth business of accelerating growth in Client Investment Assets and the associated investment revenue. NNIA represents investment asset inflows, including dividends, interest and distributions, less investment asset outflows. Excluded from the calculation are the impact of fees and commissions, market movement, internal transfers within Citi specific to systematic upgrades/downgrades with USPB, and any impact from strategic decisions by Citi to exit certain markets or services. Also excluded from the calculation are net new investment assets associated with markets for which data was not available for current period reporting. Year end 2024 is Preliminary 4) Client count includes active clients in Private Bank, Wealth at Work, Citigold and Citigold Private Client. Excludes international credit card only clients 5) Investment revenue is comprised primarily of fees earned for providing fiduciary investment management and advisory services, brokerage commissions earned on client trading activities and fees generated on alternative and traditional investments 6) Return on Tangible Common Equity (RoTCE) is a non-GAAP financial measure. RoTCE represents annualized net income available to common shareholders as a percentage of average TCE. For the components of the calculation, see slide 14 Slide 4 1) Investment revenue per advisor is calculated by dividing full year investment revenue by the average number of advisors using a five-point average of quarter end advisor count. Client advisors include Private Bank and Wealth at Work bankers, International Citigold relationship mangers, and NAM Citigold financial client advisors 2) Year end 2024 is preliminary. Client Investment Assets includes Assets Under Management, trust and custody assets 3) Client Balances includes EOP Deposits, Loans, and Client Investment Assets 16
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Footnotes (cont.) Slide 5 1) Source: Bain & Company, In a New World: Time for Wealth Management Firms to Shift Course, 2022. Data is subject to further changes, including possible changes in methodology 2) Liquid assets include bonds (long and short-term government bonds issued by both central and local governments, municipal bonds, participation bonds, corporate bonds), cash (notes and coins in circulation held by individuals), deposits (time and sight deposits), equities (direct holdings in listed stocks and shares, excludes unquoted shares and shares in mutual funds or investments trusts), as well as various funds (mutual funds, money market funds, equity funds, bond funds, funds of funds, property funds, balanced funds and other types of funds) 3) Beginning in the fourth quarter 2024, the metric previously reported as Net New Assets (NNA), which included both Net New Deposits and Net New Investment Assets, was replaced by Net New Investment Assets (NNIA) to align metric with the strategic priority of the Wealth business of accelerating growth in Client Investment Assets and the associated investment revenue. NNIA represents investment asset inflows, including dividends, interest and distributions, less investment asset outflows. Excluded from the calculation are the impact of fees and commissions, market movement, internal transfers within Citi specific to systematic upgrades/downgrades with USPB, and any impact from strategic decisions by Citi to exit certain markets or services. Also excluded from the calculation are net new investment assets associated with markets for which data was not available for current period reporting. 4Q24 is Preliminary Slide 6 1) Off-us is defined as our Wealth and Retail Bank clients’ investable assets not currently held at Citi 2) On-us is defined as our Wealth and Retail Bank clients’ investable assets currently held at Citi, including client investment assets, Wealth deposits and USPB deposits 3) Total estimated existing client investable wallet derived from 3rd party sources (Source: Equifax IXI), internal Citi data, client self-disclosed data and internal estimates. Data is subject to further changes, including possible changes in methodology 4) $1T on-us includes $0.6T client investments assets, $0.3T Wealth deposits, and $0.1T USPB deposits as of December 31, 2024 5) Citi investment revenue is comprised primarily of fees earned for providing fiduciary investment management and advisory services, brokerage commissions earned on client trading activities and fees generated on alternative and traditional investments 6) Source: Tricumen, peer median data normalized to $200K+ Wealth client segments. Peer investments revenue reflects recurring fee income plus transaction-based income. Data is subject to further changes, including possible changes in methodology Slide 7 1) Citi defines High Net Worth (HNW) as clients with investable assets between $10MM to $25MM 2) Citi defines Ultra High Net Worth (UHNW) as clients with investable assets of greater than $25MM 3) Client advisors include Private Bank and Wealth at Work bankers, International Citigold relationship mangers, and NAM Citigold financial client advisors as of end of period 2024 Slide 8 1) Customer Relationship Management 17
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Footnotes (cont.) Slide 9 1) Beginning in the fourth quarter 2024, the metric previously reported as Net New Assets (NNA), which included both Net New Deposits and Net New Investment Assets, was replaced by Net New Investment Assets (NNIA) to align metric with the strategic priority of the Wealth business of accelerating growth in Client Investment Assets and the associated investment revenue. NNIA represents investment asset inflows, including dividends, interest and distributions, less investment asset outflows. Excluded from the calculation are the impact of fees and commissions, market movement, internal transfers within Citi specific to systematic upgrades/downgrades with USPB, and any impact from strategic decisions by Citi to exit certain markets or services. Also excluded from the calculation are net new investment assets associated with markets for which data was not available for current period reporting. 4Q24 is Preliminary 2) Organic growth is defined as the sum of NNIA for each quarter in 2024 divided by 4Q23 Client Investment Assets Slide 10 1) Return on Tangible Common Equity (RoTCE) is a non-GAAP financial measure. RoTCE represents annualized net income available to common shareholders as a percentage of average Tangible Common Equity (TCE). For the components of the calculation, see slide 14. From time to time, management may discuss forward-looking non-GAAP financial measures, such as forward-looking estimates or targets for revenue, expenses, and RoTCE. We are unable to provide a reconciliation of forward-looking non-GAAP financial measures to their most directly comparable GAAP financial measures because we are unable to provide, without unreasonable effort, a meaningful or accurate calculation or estimation of amounts excluded or adjusted that would be necessary for the reconciliation due to the complexity and inherent difficulty in forecasting and quantifying future amounts or when they may occur. Such unavailable information could be significant to future results. Slide 14 1) Tangible Common Equity (TCE) is allocated to each segment based on Citi’s allocation methodology which incorporates Basel III standardized risk-weighted assets, the global systemically important banks (GSIB) surcharge, a simulation of TCE in severe stress environments, as well as a leverage component. The allocation methodology, including underlying assumptions and judgments used to allocate TCE, are periodically reassessed and as a result the TCE allocated to the segments may change. TCE is a non-GAAP financial measure 2) Net income to common for All Other (Managed Basis) is reduced by preferred dividends of $300 million in 4Q23, $279 million in 1Q24, $242 million in 2Q24, $277 million in 3Q24, $256 million in 4Q24, approximately $1.2 billion for full year 2023 and approximately $1.1 billion for full year 2024 3) Return on Tangible Common Equity (RoTCE) is a non-GAAP financial measure. RoTCE represents annualized net income available to common shareholders as a percentage of average TCE 4) Reconciling Items consist of the divestiture-related impacts excluded from the results of All Other, as well as All Other - Legacy Franchises on a managed basis. For a reconciliation of these results, please refer to Slide 15 18
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Footnotes (cont.) Slide 15 1) Reconciling Items consist of the divestiture-related impacts excluded from the results of All Other, as well as All Other - Legacy Franchises on a managed basis. For a reconciliation of these results, please refer to Slide 15. Divestiture-related impacts include the following: − 4Q23 includes approximately $106 million in operating expenses (approximately $75 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets − 1Q24 includes approximately $110 million in operating expenses (approximately $77 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets − 2Q24 includes approximately $85 million in operating expenses (approximately $58 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets − 3Q24 includes approximately $67 million in operating expenses (approximately $46 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets − 4Q24 includes approximately $56 million in operating expenses (approximately $39 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets − For the full year of 2023, revenues included an approximate $1.059 billion gain on sale (approximately $727 million after taxes) related to Citi’s sale of the India consumer banking business, as well as the approximate $403 million gain on sale (approximately $284 million after-tax) related to Citi’s sale of the Taiwan consumer banking business. In addition, for the full year of 2023, expenses included approximately $372 million (approximately $263 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets 19