(Bloomberg) — Citigroup Inc. is entrusting BlackRock Inc. with tens of billions of dollars of clients’ investments in a move that will close the bank’s only remaining in-house asset manager and outsource more of its wealth unit’s offerings.
In a new partnership, BlackRock will manage the assets of thousands of the bank’s wealthiest clients who currently have accounts with Citi Investment Management, the companies said Thursday. BlackRock, which already manages some of Citigroup’s $635 billion in client investments, will take on the last $80 billion that the bank still oversees by itself.
“We are not in the position to take this platform and make it twice as big ourselves — not nearly as strong a position as we will be working with BlackRock,” Andy Sieg, head of Citigroup’s wealth business, said in an interview at Bloomberg’s New York headquarters. “We’ve got the world’s most global bank working with the world’s leading asset manager to make this happen.”
While Citi Investment Management, part of the bank’s wealth unit, will remain, the company’s last proprietary asset management operations and some of its portfolio managers, led by Robert Jasminski, will move to BlackRock. Fewer than 100 Citigroup staff will make that move, according to bank spokesperson Mark Costiglio.
As part of the agreement, BlackRock will receive management fees, while Citigroup will keep fees for advising clients, who will be notified about the changes in coming months. The new arrangement is expected to be completed by year-end.
The plan marks a key step in streamlining Citigroup’s wealth business, which has turned its focus to the mass affluent and is vying to compete in a crowded sector to capture a greater share of rich individuals’ wallets. That’s a key target for Chief Executive Officer Jane Fraser, who previously led Citigroup’s private bank and is undertaking a multi-year plan to boost profitability.
In recent years, banks and private equity firms have been exploring partnerships with asset management companies to expand their reach in the wealth market. Earlier Thursday, Goldman Sachs Group Inc. said it would invest as much as $1 billion in T. Rowe Price Group Inc. as the companies teamed up to sell private-market products to more retail investors. The announcement sent T. Rowe shares surging.
Citigroup Investment Management’s assets are owned by clients of the bank’s Wealth at Work unit, which caters to professional-services firms and their staff, and its private bank. About half of the assets are owned by clients outside the US and will remain in the bank’s custody while they’re managed by BlackRock.
“This is a sector-defining moment,” said Jaime Magyera, head of US wealth at BlackRock. “As wealth-management firms are growing, they need to scale, they need to partner with firms that can give them the capabilities they need across the investment spectrum and across the technology spectrum.”
Wealth Tie-up
The outsourced products will eventually be available to clients of Citigold, an investment platform for affluent clients who don’t meet the firm’s private bank wealth thresholds, according to Keith Glenfield, head of investment solutions at Citi Wealth.
Citigroup’s private bank is one of only a few with enough of a global reach to provide support to asset management clients on the ground internationally through its bankers, said Rob Fairbairn, a vice chair at BlackRock. “That’s a critical part of this.”
The firms said the agreement opens the door to BlackRock managing private markets assets in the future for Citi’s wealth clients in addition to stocks and bonds. In the past year, BlackRock has spent about $25 billion to acquire Global Infrastructure Partners and private credit manager HPS Investment Partners. Earlier this year, the company set a goal of raising $400 billion in private funds by 2030.
Citigroup shares rose 1.4% at 9:52 a.m. in New York trading Thursday. BlackRock shares were up 0.4%.
Since joining Citigroup in 2023, Sieg has overseen widespread job cuts in the wealth unit and focused on growing investment inflows from clients. He also sold the unit’s trust administration business and private-markets funds platform in an effort to simplify the division.
Sieg, 58, has also faced obstacles including claims of intimidating colleagues, which triggered an investigation by outside law firm Paul Weiss, Bloomberg reported in August. The bank has declined to comment on the outcome, but praised Sieg for building “a strong, client-focused franchise that is delivering revenue growth and improved returns.”
(Updates with Goldman, T. Rowe deal in seventh paragraph, and shares in 13th paragraph.)© 2025 Bloomberg L.P.
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