How safe are Citigroup's European private bankers?

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Things were a bit different back then, but in 2006 Citigroup had big plans to grow its European private banking business. Its first quarter results suggested things aren't going exactly to plan.

Assets under management at Citi's EMEA wealth management business fell 35% between Q108 and Q109. Over the same period, EMEA wealth management revenues fell 26%.

Needless to say, all private banks are suffering, but it looks as if Citi, like UBS, is suffering disproportionately as clients take fright at the performance of the organization as a whole. According to the FT Wealth AUM are expected to have fallen only 15-20% for 2008 across the industry as a whole.

Despite this, Citi still appears heavily committed to its EMEA wealth management business. It's avoided pulling out of anywhere - the number of EMEA wealth management offices remained stable at 29. 69 of Citi's wealth management offices were closed in the US and 10 offices were closed in Asia over the same period, even though AUM in each region fell no more than in EMEA.

Citigroup declined to comment on its plans for its EMEA wealth management business. However, insiders say there have been redundancies. Some people have also exited of their own accord - a team of four went to RBC in February, Rina Bijur and Prashant Ajitsaria left the bank's UK private banking team for Standard Chartered Private Bank.

One insider points out that the EMEA wealth management business will become more important once the bank merges Smith Barney with Morgan Stanley. In the meantime, headhunters say Citigroup is still 'selectively building' its UK wealth management business, but that, "It's a difficult one given the state of the market as a whole and the problems at Citigroup."