Citigroup Contemplates Closing Once Dominant Muni Business
Citigroup CEO Jane Fraser is considering shutting down the bank's municipal-bond trading and origination business, which was once a dominant player in the $4 trillion US state and local debt market. Senior executives have proposed closing the business to align profitability with competitors, but no final decision has been made. Political considerations may factor into the decision, as banks often highlight their work in raising money for cities and states when facing scrutiny from politicians. Citigroup's municipal-bond business has seen a decline in profits and rankings, and being frozen out of Texas deals has further impacted revenue. Fraser aims to improve the bank's returns and has already initiated a major restructuring.