NEW YORK (Reuters) - Citigroup Inc (C.N) is reorganizing its U.S. wealth management unit to focus on helping clients based on their net worth, according to an internal memo dated Monday.
The largest U.S. bank will split the unit -- which includes its Smith Barney retail brokerage and its private bank -- into four segments, according to the memo from wealth management chief Sallie Krawcheck. These segments focus respectively on ultra-high net worth clients, high net worth clients, “emerging affluent” clients and institutional services, the memo said.
A Citigroup spokesman confirmed the memo’s contents.
Charlie Johnston, now chief executive of Smith Barney, will become president of global wealth management for the United States and Canada. John Longley will remain head of the U.S. private bank and take over responsibility for ultra-high net-worth clients. Both will continue to report to Krawcheck.
“Starting today, we will move from a ‘silo-first’ to a ‘client-first’ organization,” Krawcheck said in the memo.
Krawcheck also announced several other executive changes in the memo, including the naming of former Citigroup investor relations chief Art Tildesley as chief administrative officer of wealth management.
Last year, the wealth management unit posted a profit of $1.97 billion on revenue of $12.99 billion. It typically generates less than 10 percent of New York-based Citigroup’s overall profit, but last year generated 55 percent because of the bank’s losses tied to subprime mortgages and other risky debt.
Vikram Pandit, who became Citigroup’s chief executive in December, is trying to make the bank more efficient and more responsive to customers. Some analysts have called for the bank to be broken up, or perhaps to divest the wealth management unit.
Reporting by Jonathan Stempel; Editing by Maureen Bavdek and Gerald E. McCormick