Benefits from higher interest rates which have increased volume of money being moved
Citigroup's money-moving business accounts for nearly half of its profits
Division handles payments, processes capital flows and investments, and provides cash at key points in supply chains
Extensive network closely integrated with foreign-exchange teams provides competitive advantage but also comes with risks due to global reach and need to set aside reserves for cross-border and cross-currency exposures
Notable clients include Amazon, Uber, US government for payroll services
Citigroup, a leading global financial services company, is placing its money-moving services business at the forefront of its upgrade project. The division, which accounts for nearly half of the bank's profits in the last quarter, plays a crucial role in managing and moving cash globally for large international clients. Notable corporate clients include Amazon, Uber, and the US government for payroll services both domestically and internationally.
Despite being a less glamorous aspect of Citigroup's operations, the services business has proven to be a reliable source of profit. It handles payments for goods, services, and salaries; processes capital flows and investments; and provides cash at key points in supply chains. The division benefits from higher interest rates which have increased the volume of money being moved.
Citigroup's extensive network is closely integrated with its foreign-exchange teams, providing a competitive advantage due to its complexity and reliance on technology, people, and relationships. However, the global reach also comes with risks as demonstrated by the need to set aside reserves for cross-border and cross-currency exposures in Argentina and Russia.
During an investor day at Citigroup's Manhattan headquarters on June 18, CEO Jane Fraser and CFO Mark Mason will present the restructuring plans, emphasizing how the global movement of money can enhance profitability. The event will be live-streamed on Bloomberg TV.
Citigroup is putting its money-moving services business front and center in its upgrade project.
The services business accounts for almost half of the bank’s total profits from the last quarter.
Amazon.com and Uber are among the largest corporate clients of Citigroup’s services division.
The US government uses Citigroup for payroll at home and abroad.
Citigroup’s network, which supports its global reach, cannot be easily replicated due to its complexity and reliance on technology, people, and relationships.
Citigroup’s services business is working on using artificial intelligence responsibly with clear guardrails; the first use cases are expected to go live in the third and fourth quarters.
Citigroup is highlighting its services business as part of an upgrade project, emphasizing the global movement of money as a way to enhance profitability.
The services business accounts for nearly half of the bank's profits in the last quarter.
Notable clients of the services division include Amazon, Uber, and the US government for payroll services domestically and internationally.
