NEW YORK — In its quest to improve retail banking on its home turf, Citigroup Inc. has hired Cecilia Stewart, the former retail chief at fallen banking powerhouse Wachovia Corp.
Stewart joined Morgan Stanley in 2008 to lead the investment bank's foray into retail banking. Now, Manuel Medina-Mora, Citi's top consumer banking executive, is delegating some of his responsibility to Stewart.
Medina-Mora is chief executive of Citi's consumer banking business for the Americas, Chairman of the Global Consumer Council, and chairman and CEO of Citi in Latin America and Mexico. He took over the top U.S. consumer banking post earlier this year from Terri Dial, who left unexpectedly.
Stewart will start in a few months as president of U.S. consumer and commercial banking, reporting to Medina-Mora. "In this role, Cece will oversee our Retail Banking business, led by Brad Dinsmore, the Personal Banking and Wealth Management business, led by Deborah McWhinney, the Commercial Banking business, led by Sunil Garg, and the Small Business Banking business, led by Raj Seshadri," Medina-Mora said in a memorandum to staff.
"As we execute this [new retail banking] strategy, we will be making multi-year investments in our people, infrastructure and marketing," Medina-Mora wrote.
Jim Rosenthal, the chief operating officer of Morgan Stanley Smith Barney, said in a memo that Shelley Hanan would become acting head of retail banking, replacing Stewart. The departure of Stewart followed a change in strategy at Morgan Stanley that began about 18 months ago.
In late 2008, the investment bank was pursuing the acquisition of a commercial bank, but shelved those plans when it bought a controlling stake in the joint venture with Citi's legacy Smith Barney brokerage.
Morgan Stanley now has no plans to buy a retail bank, according to a person at the company familiar with the matter. Stewart's background, with more than 30 years in consumer banking, supported the company's previous goal, this person said.
Rosenthal said in the memo that Morgan Stanley's strategy is now to expand its private banking business "around our existing branch office structure." In its push to build up the private banking business--a unit that caters to the wealthiest of clients--Morgan Stanley has hired 113 private bankers to date and plans to add 500 over the next year, the memo said.
At Citi, Stewart will join a team hired from competitors. Joining her from Morgan Stanley is Will Howle, who will be chief operating officer of Citi's U.S. consumer and commercial banking business.
Dinsmore was hired in March 2009 to run the U.S. retail banking business after heading such operations for Bank of America Corp. McWhinney, a former executive at Charles Schwab Corp. joined Citi in April 2009.
In July, Medina-Mora told staff in a memo that he intends to focus, among other areas, on improving customer experience, where Citi has seriously fallen behind its competitors. It is where Wachovia had shined, making the Charlotte bank the role model for U.S. retail banking before it was forced to sell itself to Wells Fargo & Co. in 2008 because of losses on real estate loans during the financial crisis. Citi tried but failed to secure a deal for Wachovia.
