Citi Asia among top performers in region

MANILA, Philippines - Citi Asia has a superior franchise based on competitor positioning (top three in Asia), expansiveness (18 countries), consumer clients (affluent and urban) and wholesale clients (emerging-market champions, multinationals).

Based on a study undertaken by CLSA, return on asset (ROA) is one-tenth higher than regional competitors (weighted average by market).

“Credit is better versus the likes of StanChart (Standard Chartered Bank), aided by changes in India and Korea and deeper moves into the affluent. Citi looks to export Asian best practices, such as those related to digital delivery, service, and systems,” CLSA, Asia’s leading and longest-running independent brokerage and investment group, said in a report.

Citi Asia is the second leading revenue contributor of Citigroup after North America.

It is ranked among the top three in Asia based on size and expansiveness, although it is 17th in the region based on income.

The consumer banking business of Citi Asia represents about a fifth of Global Consumer Banking revenue and a little less than one third of consumer loans and deposits.

“Citigroup is one of the few regional banking groups with a material network across many key trading countries and financial centers in Asia, competing in both wholesale/corporate and retail banking. Its spread of operations enables it to compete effectively in transactional banking for multinational corporations,” the report said.

Citi Asia reports $14.7 billion across the region in total revenues.

In the Philippines, for example, Citibank is the biggest foreign bank. It is ranked 11th overall in terms of assets at $6 billion. Over the years, the bank has been posting return on equity in excess of 20 percent.

Citibank is strong in the Philippines in project finance, syndication, and consumer banking (tops in credit card market). They are also strong in wealth management.

In consumer banking, Citi is a leading brand aimed at the lucrative professional/expatriate/mass-affluent segment, with a particular strength in credit cards.

“Its key weakness lies in its relatively small scale given its choice not to compete in the mass market of consumer banking,” CLSA said.

In wholesale banking, Citigroup is a leading investment bank, a top-three transactional bank and one of the largest regional lenders in Asia, with a historical legacy and geographic spread matched only by Hongkong and Shanghai Banking Corp. (HSBC) and Standard Chartered.

It is one of the region’s oldest (since 1902), broadest across countries (more so than HSBC, which is focused more around Hong Kong) and largest retail distributors in Asia (130 Smart Banking branches, 465 total retail branches, 2,500 ATMs), even though it does not rank in the top three in consumer in any one country.

The brand name carries a degree of cachet. Through Citigold Private Client and Citigold banking services, Citi Asia serves more than 600,000 of the region’s most affluent consumers. Citibank is also the top card issuer in Asia Pacific, with about 17 million open card accounts.