Citi’s Top Banker in Miami Has Become a Coveted CEO Prospect

(Bloomberg) -- Jane Fraser is not exactly a big name on Wall Street. Based in Miami, she runs Citigroup Inc.’s operations across Latin America, a region that generates less than 15% of the bank’s revenue.

And yet, after chief executive officers stepped down at two of the world’s biggest banks in recent months -- first, at Wells Fargo & Co. in March and then HSBC Holdings Plc last month -- her name has consistently popped up among potential candidates to run both companies. That talk adds to long-held speculation in some corners of Citigroup that Fraser, an executive with a rare combination of experience in strategy as well as consumer and international banking, is a potential successor to CEO Mike Corbat.

It all feeds into a debate over what’s next for a rising star at the third-largest U.S. lender. After all, HSBC’s recruiters were in contact with her in a previous CEO hunt just two years ago, according to people close to that firm.

External advisers to banks on succession, speaking on the condition they not be identified discussing the company, argue competitors’ interest in Fraser, 52, raises the risk that Citigroup will lose her if she doesn’t continue to advance. Yet insiders at Citigroup and analysts covering the firm see little reason to worry. They expect Corbat to stay on for several more years, and there’s no sign Fraser is interested in leaving, giving the board little reason to intervene.

The buzz is also especially notable for what it says about the potential for a woman to finally reach the top of a major bank. The industry is under mounting pressure to improve diversity of its leadership. In April, white men running seven of the largest U.S. lenders were grilled at a congressional hearing about why their companies have never put a woman in charge. Several, including Corbat, said they can imagine one succeeding them.

Just last week, Royal Bank of Scotland Group Plc promoted Alison Rose to CEO, making her the first woman to run one of Britain’s big four lenders. Yet at KeyCorp, the largest U.S. regional bank run a by woman, CEO Beth Mooney announced plans to retire.

Fraser doesn’t actually want so much attention on her career, according to colleagues at Citigroup. She didn’t respond to messages seeking comment. A company spokeswoman, Jennifer Lowney, declined to comment or make executives available for interviews.

Indeed, Fraser has downplayed her prospects for rising to the top. In an interview with CNN last year, she said she never had the ambition to be CEO of Citigroup or any other Wall Street firm, acknowledging that her current role comes with a lot of the perks of running a large bank without the harsh limelight.

“I look forward to seeing a woman being the first CEO of a Wall Street firm,” Fraser said. “Whoever that may be.”

Harvard and McKinsey

Born in Scotland, Fraser earned degrees at Cambridge University and Harvard Business School, and then spent a decade at McKinsey & Co. advising financial firms.

She joined Citigroup’s investment bank in 2004, and in three years was promoted to be global head of strategy for the company, ultimately working alongside then-CEO Vikram Pandit. As the bank teetered in the financial crisis, the two cleaved entire businesses -- eliminating nearly 100,000 jobs.

Citigroup soon threw her into other problems: She took over its private bank in 2009 and salvaged parts of the unit that had been tagged for disposal. Next came the mortgage unit, where she had to address the bank’s mishandling of home loans. That gave her regular face time with regulators and board members. At one point, she accompanied directors on a field trip to the company’s mortgage operations in O’Fallon, Missouri, where they met rank-and-file employees, according to a person who attended the gathering.

Head hunters hired to find talent for Citigroup’s consumer units told potential candidates as early as 2014 that Fraser was being groomed to be the bank’s next CEO. That year she became head of its U.S. consumer and commercial bank, positioning her to potentially succeed her boss, Manuel Medina-Mora, the global head of consumer banking.

Then came a pivot: Medina-Mora’s job went to Stephen Bird, who’s also long been seen as a potential CEO. He was reported to be on a short list of candidates to take the post at Royal Bank of Scotland in 2013, as well as contacted by representatives for Standard Chartered Plc in 2015. Some in the industry suggest he, too, is qualified to run Wells Fargo or HSBC. Spokesmen for both of those banks declined to comment.

While Fraser was passed over for Medina-Mora’s job, Corbat simultaneously opened another door. He moved her to lead the bank’s sprawling operations in Latin America, parts of which were struggling, offering Fraser another chance to prove herself.

Latam Backlash

The transition to that role was tough. Fraser has recounted how the local press initially attacked her for being a foreigner and a woman.

“This was seen as a bit of an insult,” she explained to CNN. “It’s not intuitively obvious to have a woman from Scotland running Latin America for an American bank.”

For her first town hall with the region’s employees, she spoke in fluent Spanish, which she had learned on a trading floor in Madrid. The effort impressed her new staff.

In 2016, she unveiled a new name for the firm’s retail banking operations in Mexico -- Citibanamex -- finally giving it a logo that incorporated Citigroup’s brand. It had been 15 years since Citigroup had acquired Banamex, but it was Fraser who finally coaxed its workforce to see it as an extension of the U.S. bank.

She has managed to grow revenue from the region almost 8% since taking over, even while shedding consumer businesses in Brazil, Argentina and Colombia as part of the bank’s focus on paring less profitable units.

“She went into situations that were not what she was doing before and she grasped it, she got it and she drove it,” said Susan Segal, who leads the Americas Society/Council of the Americas, where Fraser is a board member. “She’s a driver of change.”

--With assistance from Erik Schatzker.

To contact the reporters on this story: Jenny Surane in New York at jsurane4@bloomberg.net;Hannah Levitt in New York at hlevitt@bloomberg.net

To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, David Scheer, Dan Reichl

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