Citizens Financial Group Conference Summary Company Overview - **Company**: Citizens Financial Group (NYSE: CFG) - **Market Cap**: $22 billion - **Total Assets**: $223 billion - **Headquarters**: New England - **Key Management**: President Brendan Coughlin oversees consumer banking, private banking, and wealth management [2][3] Core Strategies and Transformations - **Three-Pronged Strategy**: 1. Best-positioned commercial bank 2. Transformed consumer bank 3. Building a private bank and private wealth franchise [5] - **Consumer Bank Transformation**: - Shifted from a large thrift model to a relationship-based, profitable institution - Segment returns improved from mid to high teens pre-COVID to mid to high 20s, aiming for 30s [6] - Reduced branches from 1,400 to 1,000 through acquisitions and cost pruning, reinvesting in technology [6][8] Deposit and Lending Strategy - **Deposit Quality Improvement**: - Achieved top quartile performance in deposit beta and quality among the top 25 banks in the U.S. [8] - 70% of deposits are consumer-based, with a focus on relationship-driven revenue [8] - **Lending Focus**: - Transitioning to higher yielding, relationship-based lending products, such as HELOCs and credit cards [9] - Non-core loans being phased out to enhance overall loan quality [9] Private Banking and Wealth Management - **Private Bank Launch**: - Hired 150 former First Republic bankers, now expanded to over 500 [10][11] - EPS accretion target exceeded, with returns between 20% and 25% [12] - **Wealth Management Growth**: - Significant growth in fee income, from $50 million to $93.5 million quarterly [19] - Acquired Clarkfeld Advisors to enhance RIA platform, with strong client migration rates [20] Market Position and Competition - **New York Market Entry**: - Acquired HSBC's East Coast locations and Investors Bank, now operating 200 branches in Metro New York [26][27] - Growing market share against both large and smaller banks [29] - **Consumer Health Insights**: - Observing a K-shaped economy with stability in high-end segments and stress in lower segments [30] - Credit quality remains strong, with improving metrics in non-core areas [31][32] Future Initiatives - **Reimagine the Bank Initiative**: - A multi-year program aimed at enhancing operational efficiency and technology integration, including AI deployment [34][36] - Expected costs of $400 million over three years, with negligible short-term impact on earnings [36][37] - **Credit Card Strategy**: - Launched a new suite of credit cards, targeting growth to $3 billion in size [42][44] - **Home Equity Lending**: - Leading in HELOC originations with a strong focus on data-driven underwriting processes [46][47] Key Metrics and Performance - **Return on Equity (ROE)**: - Current ROE in the mid-20s, with expectations to maintain above 20% [12][57] - **Deposit Metrics**: - 42% of deposits in DDA or CWE, with a focus on maintaining a healthy deposit franchise [12][39] Conclusion Citizens Financial Group is strategically positioned for growth through its focus on relationship-based banking, private wealth management, and operational efficiency initiatives. The company is actively enhancing its market presence, particularly in competitive regions like New York, while maintaining strong credit quality and deposit metrics.