Inside Citigroup's Strategy to Become Global Consumer Bank

A Citibank ATM user.
Oliver Quillia for
A Citibank ATM user.

Citigroup is embarking on a multi-year, multi-billion dollar IT investment to integrate its consumer branches and products all over the world, Manuel Medina-Mora, the bank's executive in charge of consumer banking operations, told CNBC.

Medina-Mora, the former head of Citi’s Mexico subsidiary, Banamex, revealed the new plan in an interview at his office in Mexico City, where he still spends roughly one-third of his time.

Medina-Mora, who pushed for the new IT platform called Rainbow, says it's crucial for the major strategic shift that Vikram Pandit wants to achieve: changing Citi from a product-led bank to consumer-centric bank.

“On the consumer banking business, the 10 years before Vikram was named CEO was a period in which growth was actually led by acquisitions: banks, consumer finance companies, mortgage portfolios, auto portfolios. Very little was organic growth. What we are saying now is totally different."

He added, "We are saying, 'Not anymore, a strategy that is led by products.' It is a strategy that is centered on the client and on creating the right value propositions for them.”

Right now, Citi might have as many as 15 to 20 different customer bases in nearly every country in which it operates. For example, the credit card portfolio division is different than the mortgage portfolio division, and the two don’t necessarily communicate with each other. Medina-Mora says when this project is complete, there will be only one single customer base all over the world.

Medina-Mora says a system like this will lead to more revenue. “It's a virtuous circle, because the client, if you are doing a good job, and you are actually providing the right solutions to their financial needs, and you are listening to what he or she needs, will actually honor you with more of their business. And so, revenue per client will actually go up. Your origination costs will go down.”

This is how Medina-Mora ran Banamex, when he was CEO from 1996 to 2004. He was part of the team that sold Banamex to Citi back in 2001 for $12.5 billion. Banamex’s profits doubled between 2002 and 2007, and even posted a profit of $1.85 billion in 2008 in the heat of the financial crisis.

If he gets this massive worldwide integration right, there is speculation he could one day be CEO of Citigroup. When asked if he wants the top job, the 60-year-old said, “not necessarily,” because he's "excited" about his current job. “I have a great mandate in front of me. Building the best global consumer bank is quite significant.”

He considers Citi more than a consumer bank, but an institutional one. “I will be very happy, creating the best global consumer bank,” Medina-Mora added. “That’s a huge challenge.”

Watch Michelle Caruso-Cabrera's TV interview with Medina-Mora on "Power Lunch" today at 1pm ET on CNBC.