Citi appoints Jane Fraser as CEO, first woman to lead major U.S. bank

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Fraser, currently in charge of Citi (C) consumer bank, is expected to take over in February from Michael Corbat, who plans to retire after 37 years at the bank.

“I have worked with Jane for many years and I am proud that she succeeds me,” Corbat said in a statement. “With her leadership, experience and values, I know she will make an exceptional CEO. ”

Fraser, a 16-year veteran of the bank, was named heir in October when Citi elevated her to president.

Fraser follows in the footsteps of other high-ranking women in finance. Sallie Krawcheck was a senior executive at Citi and Bank of America (BAC) during the 2008 financial crisis. Marianne Lake was hired as Chief Financial Officer of JPMorgan Chase (JPM) in 2012. And in 2011, Beth Mooney repeated KeyCorp (KEY) in 2011, making her the first female CEO of one of America’s 20 largest banks.

In the public sector, Janet Yellen led the Federal Reserve, the most powerful central bank in the world, from 2014 to 2018. And even as Citi made her historic announcement, Christine Lagarde, the president of the European Central Bank, informed journalists during a press conference.

“I am honored by the Board’s decision and grateful to Mike for his leadership and support,” Fraser said in the statement. “Citi is an incredible institution with a proud history and a bright future. I am delighted to join my colleagues in writing the next chapter. “

Record female CEOs, but still a small percentage

Prior to taking over consumer banking from Citi, Fraser led the bank’s Latin America division as well as its corporate strategy and M&A group. Fraser also headed Citi Private Bank from 2009 to 2013. Prior to joining Citi, Fraser worked at consulting giant McKinsey and in the M&A department of Goldman Sachs (GS).

In an interview in August 2018, CNN’s Poppy Harlow asked Fraser about the possibility of breaking Wall Street’s glass ceiling.

“I can’t wait to see a woman be the first CEO of any Wall Street company, whatever it is,” Fraser told Harlow. “I never had the ambition to be the CEO of Citi or any other organization. Things can change over time. But at the moment I still have a lot to learn. ”

Fraser will join a record number of women at the helm of Fortune 500 companies. In recent months, Clorox (CLX), Coty (COTY), Difference (GPS) and UPS (UPS) appointed female CEOs. Yet less than 10% of Fortune 500 CEOs are women and only three are women of color.

Citi share price lags

Corbat took the reins of Citi in 2012, at a time when the bank was still in the grip of the financial crisis. Corbat has replaced controversial former CEO Vikram Pandit.

“I am extremely proud of what we have accomplished over the past eight years,” Corbat said in a statement. “We completed our transformation after the financial crisis and emerged from a simpler, safer and stronger institution. “

Corbat noted that Citi’s net income nearly tripled during his tenure to nearly $ 20 billion last year and that the bank was able to return nearly $ 80 billion in capital through dividends. and buybacks.

But Citi, like other banks, is grappling with a precarious environment of high unemployment and low interest rates. Citi’s profits fell 73% in the second quarter as the bank’s lending costs skyrocketed due to the pandemic.

Citi lost a third of its market value this year, lagging behind not only the S&P 500 but also its rivals such as JPMorgan and Bank of America (BAC).

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