Citigroup’s technology and communications expenses crept up to $2.4 billion during the quarter – or over $26 million every day – as it continued to modernise systems and invest in a sweeping digital overhaul; the bank retired or replaced 130 applications during its fiscal Q1, executives said.
Digital and organisational transformation “remains our #1 priority, and we will continue to make the investments needed, specifically as it relates to data and regulatory reporting” affirmed CEO Jane Fraser. (Citi continues to overhaul its data environments following a series of fines.)
Citi has now tapped Palantir to help “modernize how we leverage data and improve client experience and operational agility through enhanced processes such as onboarding, account management, and real-time insights,” in its Wealth segment, a presentation showed this week.
It is also continuing to work on “automating high priority manual reconciliations” and deploying generative AI to try and spot fraud.
Spending on cybersecurity has also grown notably and now represents “one of the most rapidly growing expense line items” said CFO Mark Mason last summer. (“Cyber is… a top firm-level priority for us” added Citi's Head of Services Shahmir Khaliq, speaking at an investor day.)
“The transformation is a very large body of work,” said Fraser in response to a question on a Q1 earnings call about progress: “We're overhauling our infrastructure. We're reducing and modernizing our applications. We're simplifying our processes. We're addressing the different root causes of what held us back, thoroughly and once and for all,” she added.
“ We're simplifying and standardizing controls across common activities. We've put a lot more preventative and detective controls in place. We're upgrading others that weren't effective enough. We're driving automation. We're driving straight-through processing of our end-to-end processes across the bank. And you've heard us talk pretty consistently over the last couple of years about the work to make the technology infrastructure onto consolidating on to single platforms… There's still work to do.., I'm not sure any bank finishes its modernization,” she added.
