Citigroup CEO Michael Corbat said Thursday he is retiring in February after eight years leading the bank, and that retail banking chief Jane Fraser will succeed him, making her the first female CEO of a major U.S. bank.
The move by Corbat, 60, finalizes a management overhaul that had been underway at the third-largest U.S. bank by assets. Last year, Jamie Forese, Citigroup's then-president, announced he was stepping down after three decades at the bank, which followed the departures of the bank's longtime chief financial officer and a pair of regional heads.
During his tenure, Corbat helped to improve a global financial institution that was still hobbling after the 2008 financial crisis. But insiders have pointed to a potential strategic error made by the bank: Unlike rivals JPMorgan Chase and Bank of America, Citigroup didn't expand its U.S. deposits base with physical branches, giving those firms a distinct funding advantage.
Citigroup shares have climbed 42% during Corbat's tenure starting in October 2012, compared with the 141% increase of JPMorgan shares in that period. Citigroup's stock price was little changed after the announcement.
Fraser's ascension answers a question many have had for years: When would the U.S. banking industry, dominated by men in leadership positions for decades, get its first female big bank CEO?
The CEO position at top U.S. banks rarely opens up, and when they do, they often go to insiders, who historically have been men. Last year, when Wells Fargo was engaging in a public search for a new CEO, observers speculated that the bank could become the first led by a woman — Fraser was apparently considered for that role — but it went to Charlie Scharf, a former acolyte of JPMorgan Chase CEO Jamie Dimon.
Fraser, 53, was a McKinsey partner when she joined Citigroup in 2004 in the firm's Wall Street division. She quickly rose through the ranks, going from head of strategy and acquisitions to CEO of the firm's private bank, then leading its sprawling Latin American operations before rising to head of global consumer banking.
Last October, she was promoted to president, reportedly to keep her from being poached to lead other banks. At that point, it became clear she had been anointed Corbat's successor. Still, the timing of her announcement caught outsiders off guard, as Corbat is younger than CEOs including Dimon. Citigroup's board has the most women on it of the six biggest banks, approaching 50% representation.
"I have worked with Jane for many years and am proud to have her succeed me," Corbat said in a statement. "With her leadership, experience and values, I know she will make an outstanding CEO."
The bank said it will name a new global consumer banking head in coming weeks.
Here is the bank's statement:
Citi CEO Michael Corbat announced that, after 37 years at Citi, including the last eight years as CEO, he plans to retire from Citi and step down from its board in February of 2021. The board selected Jane Fraser, currently Citi's President and CEO of Global Consumer Banking, to succeed him as CEO in February, and she has been elected to the board, with service beginning immediately. Jane Fraser has been at Citi for 16 years and has been in her current roles since 2019. Jane Fraser is currently the President of Citi and the CEO of Global Consumer Banking. Her global responsibilities include all Consumer businesses in 19 countries, including Retail Banking and Wealth Management, Credit Cards, Mortgages and the associated Operations and Technology.