Citi's private bank is leaning on apprenticeship-like training to help pair young bankers with clients in line for mega inheritances

REUTERS/Arnd WIegmann

Michael Corbat, the chief executive of Citigroup.

• Citi is aiming to grow the junior talent base in its private bank's North America region by some 20% in the next year, building on that pool's growth in recent years.
• Business Insider spoke with Ida Liu, the head of Citi Private Bank North America, about recruiting and training young people to work in a segment that caters to clients with a minimum net worth of $25 million.
• The private bank uses a team approach to ease younger associates into the mix, pairing associates with senior bankers. The youngest employees are often matched up with millennial grandchildren in super-wealthy families.
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Citi Private Bank plans to continue growing its pool of young talent in North America - a sign of its belief in more opportunities in catering to super-rich clients - and is banking on pairing junior employees with younger members of wealthy families.

The private bank caters to financial situations that are more complex than the average individual customer, providing services like aircraft financing. Each private banker has around 30 clients, and each client has a net worth of at least $25 million; the average client has a net worth above $100 million.

Citi has been using a team approach to ease younger associates into the mix. Associate-level bankers are often assigned to work with millennial-aged members of wealthy families, and that's something the bank wants to instill more consistently across the region.

"We're broadening that to make sure that we adopt this approach more broadly across North America," Ida Liu, the head of Citi Private Bank North America, said in an interview. "For the most part we do have an apprenticeship model, and we do find that the team-based approach and that apprenticeship model works better than solo."

Citi's private bank revenues rose 2% during the third quarter from the same period last year, which it said reflected growth in North America and Asia, offset by lower revenues in Europe, the Middle East, and Africa.

Citi Private Bank has some 1,500 employees in North America and just over 3,200 people working globally. Citi is aiming to grow its junior talent base in its private bank's North America region by some 20% over the next year, Liu said, a figure consistent with growth in recent years.

The family coverage model is aimed at covering training "from all three dimensions," Liu said, and allows the private bank to develop a talent pipeline to help it jump on future opportunities.

"Typically, the senior banker will cover the matriarch, patriarch; and the junior bankers will cover the next generation of wealth, which is very important to us as we know how much wealth is shifting over time," Liu, who stepped into her current role six months ago, said. "And the associate bankers are covering the millennial clients - so the grandkids of the patriarch and matriarch."

The private bank's approach is reminiscent of a push among wealth managers to fill the shoes of financial advisers that are expected to retire from the field in the coming years. Bank of America's Merrill Lynch Wealth Management, for example, has been putting trainee advisers on teams to help them round out their skills.

Through the third quarter, Citi Private Bank - which falls under Citi's institutional clients umbrella - globally oversaw some $460 billion in assets under management.

Citi Private Bank is also concentrating on growth "pockets," Liu said. For instance, it's focusing on building out its presence in Atlanta - more than doubling its talent there in the second half of this year. The firm added four specialists there in September, all hired from JPMorgan Private Bank.

More broadly, the private bank sees opportunities in the US South as well as in building out business with tech entrepreneurs and female clients, Liu said.

Citi Private Bank has also formed a private capital group in North America focused on providing families that have enough wealth to by treated like institutional clients help in sourcing investments like direct deals.

The firm earlier this year appointed Paul Barrett, who ran various groups at JPMorgan Private Bank for nearly two decades, to head the private capital group's North American region. Barrett had started a New York-based multi-family office two years ago, focusing on investments in the public and private markets.

The broader bank is also looking to ultra-rich families as a source of business in other ways - for example, it might leverage that relationship into investment banking business to handle IPOs or strategic sales.

But the focus on driving more business by servicing those kinds of high-level needs means that ensuring young talent is properly trained is crucial.

"You can't just rock up at the age of 21 or 22 and become a relationship manager for ultra high-net-worth clients and family offices," Peter Charrington, the private bank's global head, told the Financial Times in July as he elaborated on his unit's apprenticeship model.