Banking News

Citi Scaling Up Middle Market Presence

(10 March 2022 – Australia) Citi is targeting growth in the Australian middle market through the addition of “Lower Commercial” emerging enterprises holding international growth aspirations.

While previously the group targeted firms with a minimum A$250 million revenue, the Bank has extended its sights to those with A$75 million to A$1 billion turnover. Citi is targeting coverage of up to 300 clients dispersed across local corporates and multinational corporation (MNC) subsidiaries with defined cross-border needs by the end of 2022, up from the current 220 clients.

While Citi’s commercial banking unit generates two percent of the bank’s Australian revenue this proportion is projected to increase to as much as ten percent. Despite the incumbent Big Four majors competing aggressively on price and lending, East & Partners research records record high cumulative transaction banking relationship share of 85 percent as of March 2022, Citi is focused purely on clients with international banking needs or who could require domestic investment banking or corporate advisory services “on the ground” in new markets.

“We saw the sub A$250 million segment was the fastest growing part of the market, with companies scaling really quickly and looking offshore where they need the help of an international bank. You’ve got a lot of these corporates in the space who are transacting FX through Western Union or OFX, to me, that’s just mind-boggling. You’ve got a bank that’s put all this balance sheet out the door, but they’re not capturing FX or the full wallet, this didn’t make sense to me and when we’re looking to the segment we saw there’s a lot of opportunity” commented Citi’s Australian Commercial Banking Head, Alex Syhanath.

”A lot of these companies that were sole-banked are probably putting more focus on the way they look at banking relationships and access to liquidity. Private companies are different because their liquidity comes from one source, and it’s a bank. We sit within the institutional client group now. It did sit within the consumer bank, but about 18 to 24 months ago we moved across into the ICG” Syhanath added.