Citigroup is revamping pay for its private bankers in an attempt to boost sales of investment products and overhaul how the group's struggling wealth division interacts with its wealthy clients.

The change, which was first detailed to Citi's private bankers in a call last week and laid out to them in a memo on Thursday seen by the Financial Times, will tilt the way the group doles out year-end bonuses. More of the rewards will go to bankers who move their clients' assets into investment accounts, and less to those who sell new loans.

"As we build on our momentum and progress, we continue to pivot towards investments, growing relationships, and deepening client wallet share," said Ida Liu, who heads Citi's private banking division, in the memo seen by the Financial Times.

The changes reflect the effort by Citi and Andy Sieg, who took over the wealth management division last year, to focus more on managing investments for wealthy clients. Revenue from managing investments tends to be more highly valued by shareholders because it is typically more stable and is also less risky than lending.

"Sieg joined Citi last year from Bank of America, where he ran the group's Merrill Lynch wealth management business. He is seen as a potential future candidate to run Citi after Jane Fraser if he can turn around the wealth management unit, which remains significantly smaller than many of the group's rivals," the Financial Times reported.

Citi's wealth management arm is made up of its private bank, a workplace financial management business, and Citigold, which caters for customers whose net worth is too low for the private bank. Citi's private bank typically requires clients to have a net worth of at least £10 million to be eligible for an account, with its strength historically coming from mortgages and other lending

In the first nine months of 2024, Citi's private bank reported revenues of about £1.8 billion, flat from a year earlier. By contrast, JPMorgan Chase has grown its private banking revenues 6 per cent this year to £8.5 billion.

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