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New Leadership At Citigroup: Moving In The Right Direction

Mar. 01, 2021 12:52 PM ETCitigroup Inc. (C) Stock4 Comments
John M. Mason profile picture
John M. Mason


  • Citigroup Inc. is getting a new CEO today, her name is Jane Fraser and Ms. Fraser has some big tasks in front of her.
  • Ms. Fraser is taking over for Michael Corbat, who became Citigroup CEO in late 2012 and got the bank performing again, increasing the bank's ROTCE above 12 percent in 2019.
  • Perhaps the biggest task Ms. Fraser faces is moving Citigroup into the twenty-first century requiring a "vast overhaul" of its operating systems and moving the bank into the digital world.

Citigroup Inc. (NYSE: C) is getting a new leader today, and her name is Jane Fraser.

Ms. Fraser came to Citigroup in 2004 having worked at Goldman Sachs and McKinsey & Co. previously. At Citi, has moved around a lot, getting her familiar with many different segments of the business. Some analysts are not that pleased with this because, although she has been successful enough to gain attention for the top slot, her explicit operational performance is difficult to discern.

So, Ms. Fraser now starts out. And, how is the bank doing?

Some analysts don’t think that the bank is doing very well.

For example, in terms of market value, Citigroup, as of February 26, 2021, had a market value of $137 billion. It has the fifth largest market value among the six biggest banks in the country. At the end of 1999, the bank had a market value of $188 billion and it was number one in that category.

So, there has been a big drop in market value over these twenty-some years.

And, this record, over this time period was not very good, but we need to divide this period up into two sub-periods: before Michael Corbat, the outgoing CEO, and after October 2012, when Mr. Corbat took over the reins of the bank.

Mr. Corbat Performs

The Great Recession did Citigroup in. The bank had gone through some hard times up until then, but, in November 2008, Citigroup was insolvent, Federal regulators and the bank worked out a plan to stabilize the company.

Without going deeply into this picture, Mr. Corbat was eventually brought in to run the bank.

Very frankly, given the task facing him, I believe that Mr. Corbat did a very good job. I have said as much in quite a few articles I

This article was written by

John M. Mason profile picture
John M. Mason writes on current monetary and financial events. He is the founder and CEO of New Finance, LLC. Dr. Mason has been President and CEO of two publicly traded financial institutions and the executive vice president and CFO of a third. He has also served as a special assistant to the secretary of the Department of Housing and Urban Development in Washington, D. C. and as a senior economist within the Federal Reserve System. He formerly was on the faculty of the Finance Department, Wharton School, the University of Pennsylvania and was a professor at Penn State University and taught in both the Management Division and the Engineering Division. Dr. Mason has served on the boards of venture capital funds and other private equity funds. He has worked with young entrepreneurs, especially within the urban environment, starting or running companies primarily connected with Information Technology.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (4)

brightlake profile picture
The new leadership hasn’t moved much at all, in any direction.
@brightlake Hasn't it only been like three weeks?
I like your article. I agree with you on the former CEO Corbat. He did do a good job at a bad time, stress test stuff and all. I like your reference to GE, ATT which you are spot on. I seem to think that Ms.Frazer may be considered a long-timer. Not good when we really need a newcomer to change things and change them FAST. Why? She moved around too quickly within Citi to see any type of sustained, durable, enduring improvement. Ms. Frazer does not have the leadership experience needed for this job.

Only recently would I agree that Citi is a good bank. Yet, then arrived the 900 million $ wire mistake, which in some ways shows some of the fixing needed. I hope she can get it done, I am doubtful. This firm needs a large culture change. Shrink the firm, focus on profitable units, acquire or build a large retail deposit position ( re GS with Marcus? or other), and Do It FAST.
In before old farts comment about how Democrats are ruining America.

Citi will be $100 within 2 years imo
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