Citigroup's Bold Push Into Private Markets: A Long-Term Growth Driver?

Core Insights - Citigroup Inc. is expanding its presence in the private lending sector through strategic partnerships to diversify revenues and enhance client engagement across alternative asset classes [1] Group 1: Partnerships and Initiatives - In September 2025, Citigroup launched an $80-billion customized portfolio initiative with BlackRock, providing tailored exposure to both public and private markets [2] - In June 2025, Citigroup partnered with The Carlyle Group to enhance asset-based private credit opportunities in fintech and specialty lending [3] - In September 2024, Citigroup collaborated with Apollo Global Management to create a $25-billion private credit direct-lending program, initially focusing on North America [4] Group 2: Financial Performance - Citigroup's private bank and wealth-management revenues increased by 14% and 17% year-over-year in the first nine months of 2025, driven by higher investment-fee income and increased client activity [5] - The company aims to achieve a 10–11% return on tangible common equity by 2026 through its focus on private credit [6] Group 3: Market Position and Valuation - Citigroup's shares have risen by 48.5% year-to-date, outperforming the industry's growth of 33.4% [9] - The company trades at a forward price-to-earnings (P/E) ratio of 10.65X, which is below the industry's average of 14.78X [12] - The Zacks Consensus Estimate for Citigroup's earnings indicates year-over-year growth of 27.4% and 30.1% for 2025 and 2026, respectively, with upward revisions in estimates over the past week [14]