Citi China bets on country's huge personal banking sector

After recording rapid growth in the wealth management and credit card sectors in the past two years, Citi China is confident to replicating the sustained success in the personal banking segment in the world’s second largest economy.

The US banking giant recorded an average 30 percent growth in new clients for its wealth management business in the past two years, thanks to its constant efforts on upgrading its brand’s value proposition.

Globally, Citi saw its personal banking business grow by about 4 percent in the first quarter of 2019. For its China operation, retail banking revenue jumped by around one-fifth, as operating cost was reduced by 7 percent through continuous investment in innovative and digital services.

The lender currently does its personal banking business mainly in eight cities, including metropolises like Shanghai and Beijing as well as fast emerging cities like Chengdu and Chongqing.

“We are focused on providing wealth management services in these eight core cities, which can cover about half of the country’s high-net-worth clients,” said Darren Buckley, Citi China's executive vice president and head of global consumer banking.

The number of the super-rich with investable assets of more than 10 million yuan (US$1.46 million) has now reached 2.2 million, he added. To offer more customized services to this group, Citi China plans to launch its private banking business in the third quarter of this year.

For the lucrative credit card segment, Citi China said so far this year, it has seen the number of new credit cardholders surge by 60 percent year on year.

And the Chinese market boasts more digital services for credit cards than any of Citi's other organizations in the world. The number of new customers Citi China gets now through digital channels accounts for 98 percent of all acquisitions.

Compared with traditional means of promotion, used from 2012 to 2016, the average profit generated by card-holders obtained online has seen a two- to three-fold growth, the bank said.

“We are working hard to improve our digital capability throughout the entire business, from credit card application, approval to card activation and the use of cards,” Buckley noted.

To tap into the booming consumer finance market, Citi China said it would launch new services for digital lending, in cooperation with local third-party platforms, in July or August.