Later this year, Citizens Financial Group is planning to unveil a nationwide strategy that will make private banking a centerpiece of its future growth.
Executives at the $223 billion-asset bank previewed the strategy on Monday, detailing a full-service private banking service that seeks to capitalize on fees, loans and deposits generated by high-net-worth clients.
Citizens' private banking brand is expected to launch in the fourth quarter.
During a presentation at the Barclays Global Financial Services Conference, consumer banking head Brendan Coughlin said that the private bank's success "will be grounded in offering a world-class, extraordinary customer experience."
Providence, Rhode Island-based Citizens wants to become the primary private bank for clients in Boston, Florida, New York and San Francisco who have at least $10 million of net worth, the bank said in a presentation.
Citizens plans to complement the private banking strategy by focusing its commercial banking unit on building new relationships with private equity shops, venture capital firms and multifamily investors that frequently have high-net-worth employees and clients, the bank said in its presentation.
Citizens' private bank will offer credit cards, mortgages, operating deposit accounts and wealth management services to its clients.
While Citizens used its presentation Monday to declare that private banking is one of its top strategic priorities, its efforts to bulk up in wealth management have been under way for years. Citizens
"We've made no secret about our desire to continue to grow our wealth management franchise over the last few years," Coughlin said. "We aim to bring together the breadth of the bank … to the client in a single, integrated client experience."
Citizens' strategic focus on private banking follows its
Bank failures earlier this year, including the
For Citizens, he added, 2023 is a "year of investment." Expense growth amid the bank's expansion will cost around 8 to 10 cents on its earnings per share this year, which represents a "very smart and appropriate risk-return investment," Coughlin said.
Chief Financial Officer John Woods said that Citizens is positioned for growth after navigating through this year's economic uncertainty. The bank also pointed to what it characterized as its conservative balance-sheet management as enabling it to pursue growth.
With the private banking strategy, Coughlin said, Citizens is aiming to "play with the big boys over time."
"One thing that differentiates really large banks with midsize community banks is often the presence of a well-run private bank," Coughlin said. "We believe this move is very strategic for us in a lot of different ways."
