Citigroup CEO Jane Fraser has executed a significant restructuring of the bank, described as the most ambitious in a decade. Her strategy involved exiting 14 retail markets and eliminating 20,000 jobs over three years, aiming to simplify operations. These aggressive efforts have led to notable improvements, with Citi recording its highest quarterly revenue in a decade and its return on tangible common equity reaching 13.1% in the first quarter, the highest since 2021. The bank's market value increased by 83% since Fraser became CEO in 2021, reaching $215 billion by May 2026.
Fraser's turnaround plan, influenced by her consultant background, focused on divesting non-core businesses, simplifying the organizational chart, and reallocating capital to high-performing divisions. She categorized Citi's operations into five distinct business lines and flattened its management structure from 13 layers to 8. Wells Fargo Securities analyst Mike Mayo praised this reorganization as the most powerful change at Citi, crediting Fraser for reducing bureaucracy and a complex global matrix structure. Fraser also emphasized a cultural shift, urging employees to embrace accountability and focusing on results over effort.
Despite the positive performance metrics and investor confidence, Fraser's tenure has not been without challenges. The bank still faces two regulatory consent orders. Additionally, some of her key hires, such as wealth chief Andy Sieg and head of banking Viswas Raghavan, have faced allegations of bullying, though Citi has defended them. Citi is also investing in AI, with AI-assisted code reviews freeing up 100,000 hours of capacity per week for its engineering team. The question remains whether Fraser can successfully transition Citi from a "fix-it" mode to a genuine growth story after stabilizing the bank.
