Yahoo Finance Citizens CEO Plots a Continued Expansion of Wealth Businesses
(Bloomberg) -- Citizens Financial Group Inc. Chief Executive Officer Bruce Van Saun is continuing to expand the bank’s wealth-management offerings in an effort to attract new high-net-worth clients.
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“We want to have more choice to the customers in terms of wealth options,” Van Saun said in a Bloomberg Television interview Tuesday.
Citizens hired Morgan Stanley veteran Paul Casey to lead the firm’s wealth business in April amid its effort to build out that offering alongside its newly launched private bank. The venture was started to draw away customers of firms including failed lender First Republic Bank, which was acquired by JPMorgan Chase & Co. last year.
The firm has hired teams of advisers in Boston and San Francisco to bolster its Citizens Private Wealth franchise as it chases “ultra-high-net-worth” clients. The California addition was a dozen-person team helmed by Rick Gordon, which had previously managed about $5 billion in client assets.
“We have Boston, we have San Francisco,” Van Saun said in a separate interview Tuesday. “We still need to fill in New York and we still need to fill in Florida.”
Since last year, Citizens has hired around 220 private-bank employees, Van Saun said Tuesday — an investment that has so far cost the Providence, Rhode Island-based bank, but will add significantly to earnings moving forward, with executives hoping the bottom line will be boosted next year, he said.
Regional lenders such as Citizens have been closely monitoring the commercial real estate market as pandemic-spurred vacancies have persisted and interest rates are remaining higher for longer, pushing up borrowing costs. Van Saun recently likened the loan troubles to a “pig going through the python” — a slow-moving situation that is working itself out, without surprises.
“We have plenty of capital, plenty of reserves, to handle it,” he said, after warning last week that the lender’s reserves may remain high for the next few quarters. He reiterated Tuesday that the majority of the risk remains in office-linked commercial real estate, while other segments remain healthy.
--With assistance from Katie Greifeld.
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