Citigroup Inc. will make sweeping changes to its checking-account offerings as the banking giant makes a deeper push into wealth management.
(Bloomberg) — Citigroup Inc. will make sweeping changes to its checking-account offerings as the banking giant makes a deeper push into wealth management.
The company is ditching standard account packages and will instead adopt “relationship tiers” that are based on customer’s deposit and investment accounts, according to a statement Wednesday. As customers plow more money into their Citigroup accounts, they’ll automatically be moved into new accounts that offer additional rewards.
Under Chief Executive Officer Jane Fraser, Citigroup has been seeking to beef up its offerings for the world’s most affluent individuals, and the firm has hired Andy Sieg, a longtime Bank of America Corp. executive, to lead its burgeoning wealth business. In the first five months of 2023 Citigroup’s retail bankers drove 25,000 referrals to the company’s wealth advisers, an 18% increase from a year earlier.
“We’re moving from an old-school product-package approach, which was competitive but static,” Craig Vallorano, head of retail banking, said in an interview. “This structure really opens it up to be relationship-driven as we originate relationships, not accounts. We are really looking to grow along with our customer.”
While Citigroup is one of the country’s largest banks, it has a relatively small branch presence in the US, with roughly 650 locations spread across just six cities. In the second quarter, the bank had $113 billion in average deposits in the US, down 3% from a year earlier.
The changes comes as Citigroup weighs removing more of the fees it charges on checking accounts after it got rid of overdraft charges and returned-item fees last year.
The company currently offers a regular checking account that comes with a $15 monthly service fee, though the fee is waived if customers have at least $250 of direct deposits made into the account every month. The company last year began allowing Zelle and Venmo payments to count as direct deposits, a move that meant more gig-economy workers could qualify for the waiver.
“We have an eye on reviewing all the fees that we charge to clients,” Vallorano said, declining to disclose which fees might be thrown out. “We’ll be looking for the opportunities to either eliminate or otherwise allow for more control.”
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.