The head of Citigroup’s global cards business, Jud Linville, is leaving the bank as part of a restructuring designed to unify the business with other parts of the retail banking operation.
Anand Selva, head of consumer banking in Asia, would become the head of US consumer banking, the company said on Monday, taking responsibility for the retail bank, including wealth management, and the US card business.
In markets outside of the US, a single Citi executive is responsible for both retail banking and cards, something the company says makes it easier to sell multiple products to its customers.
The US card businesses had reported to Jud Linville as global head of the card business. In will now report to Mr Selva as head of US consumer banking.*
Citi also said David Chubak, head of global retail banking, would assume additional responsibility for global consumer lending — a role the bank described as primarily strategic rather than operational.
The bank is the largest credit card issuer in the world by sums lent, with $158bn in outstanding loans as of the second quarter of this year — with the majority held in the US. It has more than 140m cards in issue and credit card lending is a quarter of its total loan book, a high level compared with peers.
In the second quarter, net income at the card business fell 1 per cent from the year before. In Citi’s fourth-quarter earnings call, the bank said 2018 revenue growth in its US branded card portfolio would be flat, down from 5 per cent in 2017.
The restructuring was announced by Citi’s global consumer banking chief executive Stephen Bird, who told staff the changes would “intensify execution in the US and drive greater client-centricity in our global product and segment strategy”.
Citi’s shares rallied along with those of other large US banks through much of 2016 and 2017. Since early 2018, however, shares in the sector have slumped. Citi’s second-quarter earnings, like those of competitor JPMorgan Chase, were strong, featuring double-digit increases in net income, supported by the US tax cut and good results in investment banking. One factor that concerned investors, however, was an increase in funding costs for its operations.
Mr Linville was poached by Citi in 2010 from American Express, where he had been chief executive of consumer services, responsible for its US memberships rewards and its US credit cards and prepaid cards business.
Credit card issuers have been in an intensifying battle for customers in recent years in the US, with escalating rewards being offered for new sign-ups. JPMorgan’s Chase Sapphire card, with particularly generous sign-on bonuses and travel rewards, has given Citi’s long-time rival an edge with high-spending millennials.
The industry received a boost from a recent US Supreme Court ruling, however, in a case brought by American Express over the fees charged to merchants that take their cards. Merchants can be barred from steering customers to use cheaper credit cards or cash, according to the ruling.
* This story has been amended to clarify Jud Linville’s roles while at Citigroup