Citizens looks beyond loans in effort to tap student market

• Key insight: Citizens Financial Group rolled out a digital banking center for college-bound students and their families.
• What's at stake: The portal is one way the bank is trying to harness relationship banking as a way to drive more business.
• Expert quote: "We've shifted … to a mindset that's more holistic," a Citizens executive said.

Citizens Financial Group in Providence, Rhode Island, is leaning into student banking, marking another way the regional bank is trying to maximize its relationship-focused strategy.

The $218.3 billion-asset company has launched an online student banking center that provides advice, tools and banking products to students and their families as they navigate the college planning process. The rollout of the digital hub follows Citizens' September 2022 acquisition of College Raptor, an online college search and comparison platform that launched in 2012.

The student banking hub has three components — free articles and webinars about college, financial aid and life after college; digital tools to search for and compare colleges, scholarships and financial aid packages; and student-geared banking products, such as checking accounts and student loans.

The goal is to become a reliable resource to students and families as they plan for and invest in higher education, and thereby build stronger connections and ultimately sell more products to existing customers.

"We're trying to be more deeply engaged with our existing customers, which we haven't done well in the past," Chris Ebeling, head of student lending since 2021, told American Banker. "If we engage and retain the students of our existing mass affluent and affluent households, those students are more likely to become future mass affluent and affluent customers of the bank."

Citizens is one of a few U.S. regional banks with a niche in student banking. PNC Financial Services Group in Pittsburgh offers a student banking center, which includes student-centered finance tips and resources, budget and college-cost tools for families and specialized products such as a virtual wallet for students, plus private student loans and refinancing options.

KeyCorp in Cleveland offers student loan refinancing and other banking and lending products through the digital bank Laurel Road, which caters to doctors, dentists, nurses and other medical professionals.

Citizens' embrace of relationship banking includes its 2-year-old private bank, which has been growing deposits and assets under management, with an eye on providing comprehensive wealth management products and services.

The bank's play in student banking comes as the Trump administration is reportedly weighing the possibility of selling some federal student loans into the private market. The idea would be to reduce the amount of student loan debt on the government's balance sheet, according to Politico, which cited anonymous sources.

Analysts at Compass Point Research & Trading expressed skepticism Wednesday that the Trump administration would be able to unload federal student loans without providing a government guarantee.

"An outright sale of the student loan portfolio is improbable based on our analysis of the student loan portfolio composition," the Compass Point analysts wrote. "Over 50% of the student loan portfolio is in forbearance, deferment, default, or bankruptcy as of June 30, 2025."

Citizens declined to comment Thursday on whether it would be interested in buying federal student loans from the government. But it has recently offloaded certain student loans that didn't jibe with its current relationship-building focus.

Earlier this year, the bank identified about $1.9 billion of noncore student loans to sell, and about $200 million worth of loan sales settled in the first quarter. The loans were purchased years ago as part of a previous strategy aimed at building up Citizens' balance sheet, Ebeling said.

The bank expected to be fully rid of its purchased education loans by the end of September, according to its first-quarter 2025 earnings presentation.

Citizens' new student banking hub includes a "college match" tool that helps students and families find the best fit for higher education. It also includes college rankings, a "career finder" application and a free student loan calculator to help understand post-graduation loan repayment options.

The hub "means we've shifted from a more narrow 'moment of need' mindset, which historically has been focused on funding college, to a mindset that's much more holistic," Ebeling said.