Citi’s investment banking market share drops to lowest level since 2000

Citigroup’s share in the global investment banking market fell to its lowest level on record last year, according to new data, as investors demand that the bank catch up to its Wall Street peers.

Figures from the London Stock Exchange Group (LSEG) showed JP Morgan’s investment banking franchise accounted for an industry-leading 6.8 per cent share last year. It was the only one of the top five firms to grow its market share last year, by 0.3 per cent.

Meanwhile, Citi’s investment banking business made up 3.4 per cent of the market, 0.2 per cent lower than in 2022 and its lowest proportion of the global investment banking wallet since LSEG started tracking the data in 2000.

The bank this week touted news that it had poached JP Morgan’s head of investment banking to lead its new banking division.

The move comes as part of a major restructuring to shore up Citi’s balance sheet, involving 20,000 job cuts and a new corporate structure comprising five operating divisions

“Like many of its peers, Citi saw significant declines in investment banking revenues over the last two years, impacted by a global slowdown in dealmaking activity,” Matthew Toole, deals intelligence director at LSEG told City A.M.

He added: “As Citi embarked on its major transformation last year, it was quite clear that changes were coming to the investment bank, which despite some key areas of strength, has lagged behind its American peers over the last decade.

“Yesterday’s announcement marks a major milestone in Citi’s journey as the firm looks to strengthen client relationships across deal making, capital markets and corporate and commercial banking.”

LSEG’s data showed JP Morgan’s market share was followed by Goldman Sachs at 5.5 per cent, down 0.5 per cent from 2022.

Bank of America and Morgan Stanley ranked third and fourth respectively, followed by Citi at fifth.

Barclays, which last week confirmed plans to break up its corporate and investment bank, had the sixth-highest share at 2.7 per cent, above wealth management titan UBS.

Some investors have called on Barclays to ditch its investment bank entirely as it consumes huge amounts of capital and generates volatile earnings that are dwarfed by Wall Street.

UBS’ share dropped one per cent year-on-year to 2.1 per cent, the biggest fall on LSEG’s 2023 index, amid a shotgun merger with domestic rival Credit Suisse agreed last year. Its total investment banking fees slumped 38 per cent in 2023.

Citi’s fees came in at an estimated $3.6bn last year, down 12 per cent from 2022 and its lowest annual total since 2011.

Global investment banks were hit by a slump in dealmaking and capital markets activity last year, with LSEG’s data showing that fees across the top 25 investment banks dropped seven per cent to $106bn (£84bn).