Citi names Fraser first woman CEO of a major Wall Street bank
Citigroup picked Jane Fraser as its next CEO, placing the first woman atop a major Wall Street bank.
Fraser will succeed Mike Corbat, who is retiring in February after more than eight years in the top job. Fraser, who was named the company’s president last year in a move that marked her as the heir apparent, has run the bank’s consumer unit, private bank and Latin American operations in her 16-year tenure.
Corbat helped Citigroup shrink and return to consistent profitability after the behemoth almost collapsed in the 2008 financial crisis. Now, Fraser will be tasked with improving returns that trail industry leader JPMorgan Chase and using the bank’s global network in a world that’s seeing more nationalism and trade barriers.
“We completed our transformation from the financial crisis and emerged a simpler, safer and stronger institution,” Corbat said in the statement. “There is always more to do and I believe the time is right for my successor to lead Citi through this next stage of progress.”
Fraser, a 53-year-old Scot, joined Citigroup in 2004 after a decade as a McKinsey consultant. Her promotion last year came after she was viewed as a potential candidate for CEO jobs at other banks, including Wells Fargo. She will join Citi’s board immediately and take on the CEO role once Corbat retires, the New York-based bank said in a statement Thursday.
Under Corbat, Citigroup has become a slimmer organization with just two main businesses: the institutional clients group and the global consumer bank. In the institutional unit, Corbat has focused the bank’s efforts on its “network” businesses, such as its treasury and trade solutions group, which he often refers to as the “backbone” of the bank.
Still, the firm has struggled to bring down costs and achieve its profitability targets. The shares have risen 43% in Corbat’s tenure, less than half the advance of the S&P 500 Financials Index. They climbed 1.1% at 10:40 a.m. in New York.
“A fresh look is good in our view, since the prior CEO failed to reach Citi’s targets and move the company enough strategically,” said Mike Mayo, an analyst at Wells Fargo.
Corbat, 60, is bowing out as Citigroup battles one of its biggest challenges ever with the coronavirus pandemic, which has forced the bank to keep much of its workforce home and craft widespread forbearance offerings for its customers around the world.
As the world’s largest credit-card issuer, Citigroup will soon see the global tidal wave of unemployment begin to make its way to its portfolio as those programs and government relief funds slowly run out. Citigroup said it would announce a successor for Fraser to run the consumer unit in coming weeks.
Fraser has led the bank’s response to the coronavirus pandemic in North America, including its plans for returning its workers to offices around the U.S.
“The way our team has come together during this pandemic shows what Citi is made of,” Fraser said in the statement. “I am excited to join with my colleagues in writing the next chapter.” —Additional reporting by Felice Maranz