It is tempting to conclude that Citi’s impressive suite of treasury management services, for which it wins the award of Latin America’s best bank for transaction services, is the result of the bank knowing that it really needs to excel in this area. Given the growth strategy being pursued by chief executive Jane Fraser, which has seen the bank pull out of many retail banking markets to focus on corporate and investment banking, a market-leading transaction services offering is imperative.
Transaction services such as cash management have a similar importance for Citi that deposits have for retail banks. Cash management is an annuity business, a constant stream of fees and spread. It also stimulates an additional flow of banking needs. Transaction services provide constant touch points with Citi’s client list and constant opportunities for relationship building.
Citi’s transaction services team in the region is led by Steve Donovan, Latin America head, treasury and trade solutions (TTS). The bank is onshore with TTS in 20 Latin American countries, while globally it is present in 95 countries, transacts in 145 currencies and is a member of over 250 clearing systems.
In 2022, Citi experienced 40% growth in its Latin American trade and transaction services business, which is impressive given its already large base. The bank grew its trade finance business by 16% and saw a remarkable 63% increase in liquidity, with a 15% increase in payments and receivables and an 85% jump in commercial cards.
Citi continues to focus on simplifying and streamlining both the technology and the processes that underlie the transaction services that it provides. This strategy sees many iterations of its technology so it is often hard to separate any specific innovation in a particular year. But one completely new service that Citi introduced in the awards period was its sustainable trade and working-capital loans product.
Citi continues to focus on simplifying and streamlining both the technology and the processes that underlie the transaction services that it provides
These loans enable Citi’s clients to better manage their working-capital needs by financing their international trade-finance activities, as well as day-to-day commercial activities, while maintaining sustainability goals. The proceeds of the loan are used for an environmental or social purpose and meet certain sustainability criteria. The launch is part of Citi’s drive to expand sustainable trade and working capital products as a part of its broader commitment to advancing the environmental, social and governance agenda in Latin America.
