Several mid and senior management-level executives of Citibank NA’s India unit are looking to move as the process of winding up the US-based lender’s retail business enters its last lap, people with knowledge of the matter said.
On April 16, Citi said it will exit its consumer and retail operations in 13 countries across Asia and Europe. The 13 are Australia, Bahrain, China, India, Indonesia, Malaysia, the Philippines, Poland, Russia, South Korea, Taiwan, Thailand and Vietnam.
Many mid- and senior-level executives of Citibank India are on the lookout for jobs elsewhere, and many senior employees have already left, said multiple employees, both present and former. Headhunting firms in the banking sector confirmed the trend.
“People at all levels are looking out,” said a top employee of the bank in India who spoke on condition of anonymity. “There are multiple factors playing out including the top level leadership change. The decision to sell the retail assets have accentuated the trend,” said the employee.
Citibank has around 5,500 employees in India, of whom around 3,500-4,000 are in the retail division. The bank also has around 20,000 people in back-end operations.
In announcing the exit, Citi's Global CEO Jane Fraser said the bank lacked the scale to grow in many markets. “Citigroup lacks the scale to properly compete in the 13 markets it is leaving," she said.
Citi will henceforth sanction banking franchises in Asia and EMEA (Europe, Middle East and Africa) solely from four wealth centres -- Singapore, Hong Kong, the United Arab Emirates and London.
A few banks have shown “preliminary interest” in acquiring Citi’s retail operations, according to multiple people familiar with the development.
Among those that are understood to have reached out to Citibank are key rivals HSBC Holdings Plc., DBS Bank Limited, Kotak Mahindra Bank Limited and HDFC Bank Limited.
Safer pastures
There have already been a number of exits from Citibank India’s legal division, and risk compliance and technology departments so far this year, the employee quoted above said.
Before the announcement of the exit, Citibank’s director and head of consumer operations Arvind Singla joined Bandhan bank in February as head of operations and technology.
Top leadership changes after Pramit Jhaveri’s exit as Citibank’s India CEO in November 2019 triggered many senior level exits, said the employee cited above.
“There is disconnect with the current top and the mid-senior level. That has contributed to the exits. The retail asset sale has added to the woes,” said the employee.
According to Native, a head-hunting agency, between July and September 2021, eleven exits have taken place from Citibank; out of these, one was from consumer lending and six from private banking.
In the private banking space, Srikant Ramchandran joined InCred Wealth as managing partner. Sreenesh Pai, Himanshu Khullar and Alok Bagri joined InCred Wealth as directors and Bhavik Mody was hired by IIFL Wealth as principal.
In the consumer lending space, Prashant Sinha, a former Citibank employee, joined Axis Bank as senior vice president and product had - cards.
Native published these details in its July-September migration report in a LinkedIn post.
Better opportunities
According to a second employee, who too declined to be named, no one has been asked to move out.
“However, there are many who have left the company voluntarily for better job opportunities while some (have exited) for better hikes and salary,” the person added.
According to experts, the exiting talent will be flowing across retail and wealth management business units of banks and new age financial institutions.
The credit card business in India, in particular, is expected to grow because technology has enabled banks to expand their reach, said a former employee at the bank who has switched to a private financial institution.
People with a strong business sense and technology are moving out for better opportunities, the second employee added.
Business challenges
Over the years, Citibank has been facing a challenge from local competitors in India and has been steadily losing market share.
"If you are not among the top three players in a market, then the question is whether you want to be in that market at all," Sanjiv Bhasin, former India head of DBS Bank and a veteran banker who has spent long years abroad in the business, told Moneycontrol on April 20.
Citi’s share of the retail business has declined over the years in the face of increasing competition. The bank had close to 3 million customers in retail, 2.2 million credit cards and 1.2 million bank accounts as of March 2020.
It had around a 6 percent share of credit card spending in December 2020, but this proportion would have declined further since then, observers said.
The bank had advances of Rs 66,507 crore and deposits of Rs 1,57,869 crore. Citi's retail business contributed 30 percent to total revenue in the year ended March 2020, and corporate entities pitched in with 50 percent.
In 2018-19, retail contributed 34 percent of revenue and corporate customers 46 percent, according to the details available. The percentage of non-performing assets (NPAs) to net advances had gone up to 0.56 percent as of March 2020 from 0.51 percent in the previous year.
Citi’s credit card business consists of prime customers with higher-than-average spending in the banking industry .
According to Reserve Bank of India data, the lender had 2.6 million credit cards outstanding. The bank, in its annual results announcement for 2019-2020, said the average spending on cards issued by it was 1.4 times higher than the industry average. The bank also had 1.6 million outstanding debit cards as of August 2021.
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