Citigroup to expand digital platforms in Asia

HONG KONG • Citigroup is expanding its digital-banking channels in Asia as the bank seeks to boost its base of affluent customers in the region by at least 10 per cent this year.

The New York-based firm is accelerating the deployment of technologies that allow customers to get advice from wealth managers and make transactions through its Internet and mobile platforms, according to Mr Gonzalo Luchetti, Citigroup's Singapore-based head of Asia-Pacific retail banking.

The retail division currently has about 400,000 affluent clients in Asia, with assets ranging from US$100,000 to US$10 million (S$138,000 to S$13.8 million).

"The objective is to continue to bring consistent client-led growth to our business over the next few quarters," said Mr Luchetti in May.

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He added: "We have to keep growing clients the way we have over the last 12 months when we started this transformation", with digital banking driving the wealth-management business.

He also said that growth in that period was "in a solid double-digit range".

Global banks such as Citigroup, Standard Chartered and HSBC Holdings are seeking to tap into burgeoning household wealth in Asia through new technologies that they hope will bolster earnings in a cost-effective fashion.

Citigroup expects consumer spending in Asia to overtake North America by 2020, according to its internal projections.

In Asia, the bank intends to offer online services such as wealth advice, investments and video banking to customers in more markets in the region, said Mr Luchetti. More than 90 per cent of Citigroup's retail transactions in the region currently take place via self-service channels, he said.

"The clients are voting with their feet," he said. "We're following our clients in that regard."

Mr Luchetti's division is part of Mr Anand Selvakesari's Asia-Pacific consumer banking group, which oversees 17 out of 19 of Citigroup's consumer markets.

Mr Selvakesari's role was enlarged almost a year ago when his group absorbed Citigroup's consumer businesses in Europe, the Middle East and Africa. It accounted for 22 per cent of the US lender's global consumer-banking revenue in the first quarter.

The digital expansion has allowed Citigroup to trim its brick-and-mortar branches in the region, which Mr Luchetti described as an ongoing and "long-term trend" for the industry. The US bank reduced its Asian branches by 11 per cent to 397 in the first quarter from a year earlier, according to a statement in April. Average deposits in the region grew 6 per cent to about US$93 billion in the same period.

Asked about the prospect of further branch closures, Mr Lucchetti said: "There's probably more work to do in that journey."

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A version of this article appeared in the print edition of The Straits Times on June 09, 2017, with the headline 'Citigroup to expand digital platforms in Asia'. Print Edition | Subscribe