Citi Surpasses Goldman

Yes - Citi clearly has the best business model and platform to do very well in the next couple of years. They will solidify their position as the number 1 investment bank.

not sure in terms of deals but they do take care of staff, they have diversity council and hold all these training sessions and external speakers for jr ibankers.

I had a couple of friends working at citigroup, and they RAVED about it. I guess citi takes care of its own, and it's coming up in the banking world...

people i know there don't have the same sentiments... so goes life

i thought everyone on this board said ppl on the street refer to citigroup as shittygroup b/c of their low status

Didn't they plan to lay off a large amount of bankers also?

I'm loving everyone here praising citi. Keep the hilarity coming.

The bankers were not laid off

Citi's one-stop, integrated model does seem to be the model of the future and their rapid ascent to the top doesn't really come as a surprise. If you looked at the January league tables they were either #1 or #2 in most of the categories.

Citigroup won't reach a position as the "#1 investment bank" as someone put it unless they fix one big problem they have. IBD at most banks accounts for about 25% of both revenue and income, whereas sales/trading/structuring accouts for most of the other 75% (talking only about the investment bank here, not the commercial bank, alternative investments, or principal investments).

While Citi's revenues are good, their profit sucks. The reason is because they are a flow shop. All that income Goldman made last year that set records was based on innovative structuring and trading of complex derivates. Far and away the highest margins. Citi is not really know for its structured products, and is a shop focused on flow trading. And it doesn't matter how much business you get in IG bonds, cash equity, or even underwriting, the margins just aren't there.

So no matter how well they do in IBD, if they continue to trail the rest of the street in the areas that comprise the other 75% of income, then they simply will not be able to catch Goldman or Morgan.

Also, all the commercial banks struggle with one other issue--they have to maintain a strong credit rating, thus they are very wary of risk and usually are much more restrictive with their DVar and who they trade with. Whereas dealer/brokers like Goldman (which is really just a big hedge fund these days) are much, much less risk-averse.

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this article is from 2007

hindsight is a beautiful thing. really makes u think reading about those comments made in 07 =S