the wonkas
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Company
LOGO
Citigroup Global WealthManagement
Maximizing
Performance in aCompetitive Market
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Company
LOGO Agenda
Objective
Overall Strategy
Formulating approach for each geographical region
Deploying Smith Barney
Conclusion
BCG
Consultant: Wendy
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Company
LOGO Citigroups Objective
Understandthe
environment
UtilizingAppropriateResources
Build and AchieveGrowth
BCG
Consultant: Wendy
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Company
LOGO
HNW
Affluent
CPB
SmithBarney
Strategy of Global Wealth ManagementBCG
Consultant: Wendy
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Company
LOGO
CHINA
INDIA
SOUTH KOREA
Targeted Markets
BCG
Consultant: Wendy
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Company
LOGO
Joint Ventures
Acquire Stakes inLocal Banks
Approach into China
BCG
Consultant: Wendy
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Company
LOGO Action Plan
Increase investment in local bank
2005
Acquire ownership of banks
2006/2007
Intensify Offshore Pri
2009
Liberalization
2006
BCG
Consultant: Wendy
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Company
LOGO
Undeveloped
Legislative
Framework
Restricted
Foreign Investment
Assets Locked
in Country
Undeveloped
Derivative
Market
Highly Regulated
Environment
Regulatory FrameworkBCG
BackConsultant: Wendy
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Company
LOGO High Net Worth Individuals
Demands:
Good service andintimate relationship
New and innovativeproducts
Balance between
returns and risk
Transparency andhigher disclosure
Characteristics:
Risk adverse
At initial stage of wealthaccumulation
Not receptive towesternized concepts ofwealth management
BCG
BackConsultant: Wendy
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Company
LOGO
Liberalizationin 2006
Private BankSector
Foreign BanksEntry through
Acquisition
CompetitionFrom/Among Local Banks
BCG
BackConsultant: Wendy
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Company
LOGO Citigroups Positioning
CPB cannot enter at the moment
Need to establish presence in the Chinamarket
Balance between gaining foothold andlosing valuable knowledge and expertise tolocal firm
Map
BCG
Consultant: Wendy
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Company
LOGO
Market CitiGroup PrivateBank Products through
selected branches
Tap on Smith Barneysexpertise to offer
innovative products
Approach into KoreaBCG
Consultant: Alvin
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Company
LOGO
LowInterest Rate
Private BankSector
CustomerPreferences
CompetitionFrom/Among Local Banks
Regulatory Framework
BCG
Consultant: Alvin
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Company
LOGO
Intense scrutiny of
Private Banking Sector
Liberalization of
Domestic market
Tax Laws
Highly Regulated
Environment
BCG
BackConsultant: Alvin
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Company
LOGO
High Net Worth IndividualsDemands:
High-yieldproducts
Characteristics:
Professionals entrylevel private bankingclients
More knowledgeableand sophisticatedinvestors
BCG
Consultant: Alvin
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Company
LOGO Action Plan
Market
Citigroup
Private Bank
& Smith
Barney
Products
Identify &
acquire
targets to
consolidate
Intensify
Offshore
Private
Banking
Map
2005 2006 2008
BCG
Consultant: Alvin
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Company
LOGO
Organic Growth
Develop humancapital
Approach into IndiaBCG
Consultant: Alvin
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Company
LOGO
CustomerPreferences
Private BankSector
Foreign BanksEntrance intoIndian Market
CompetitionFrom/Among Local Banks
Regulatory Framework
BCG
Consultant: Alvin
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Company
LOGO Demographics
Indian consumers tend to stick with theirbank
Number of High Net Worth Individuals(HNWI) in India grew at 14.6% twice that of
the world's growth of 7.3% in 2004
BCG
Consultant: Alvin
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Company
LOGO Action Plan
Grow
business
organically
Acquire
NBFC/
Develop Joint
Venture
Embark on
acquisitions
2005 2006 2009Training
Programme
BCG
Consultant: Alvin
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Company
LOGO
Offshore Banking
Consultant: Alvin
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Company
LOGO
India
China
South Korea
Singapore
Hong Kong
Offshore Banking StrategyBCG
Consultant: Alvin
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Company
LOGO
Singapore Hong Kong
Robust Regulatory
Conditions Vibrant CapitalMarkets
Strong BankingSecrecy Laws
Well-trainedworkforce
Political Stability
Offshore Banking HubsBCG
Consultant: Alvin
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Company
LOGO Strategy Overview
CitigroupPrivateBankCitigroup Global
Corporate &Investment Bank
Customer
Smith Barney Private Client
BCG
Consultant: Alvin
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Company
LOGO
Asia Potential
BCG
Consultant: Zehan
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Company
LOGO
Client Band Net Worth Citigroup PrivateBank
Smith Barney
Ultra high networth
>$50 million
Very high networth
$5 million to$50 million
High net worth $500,000 - $5
million Entry-level high
net worth$100,000 -
$500,000
CPB and Smith BarneyBCG
Consultant: Zehan
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Company
LOGO Growth Potential in Asia
1.9
2.52.2 2.1
2.52.52.3
2.62.7
1.5
2
2.5
3
millions
2002 2003 2004
Year
Distribution of HN
A sia-Pacific Europe North A meric
BCG
Consultant: Zehan
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Company
LOGO
6.0
8.0
10.0
12.0
14.0
$Trillion
s
2004 2005F 2006F 2007F 2008F 2009F
Year
Total Wealth of HNWI by Regio
Asia-Pacific Europe North America
Growth Potential in AsiaBCG
Consultant: Zehan
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Company
LOGO Competitive Situation
Market Share in As
27.03%
27.03%18.92%
13.51%
13.51%
Citigroup UBS HSBC JP Morgan Credit Suiss e
BCG
Consultant: Zehan
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Company
LOGO
CHINA
Smith Barney Potential
Consultant: Zehan
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Company
LOGO
China
Foreign Banks
R
egulations
Market Overview - China
Domestic Banks
Internal
Environment
BCG
Consultant: Zehan
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Company
LOGO
Restrictions in
Geographic locations
Restriction in direct
investments
Restrictions in
Services
1
2
3
RegulationsBCG
Consultant: Zehan
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Company
LOGO
CompetitorsDomestic banks Big Four
Foreign Banks Fast Movers
Customers
45% Tax rate
Growth trends of sophisticated
investors
Restrictions on product
offerings
Market Conditions
Labour
Education level
Wage rates
BCG
Consultant: Zehan
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Company
LOGO
South Korea
Smith Barney Potential
Consultant: Heng Liong
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Company
LOGO South Korea
Factorsincreasing
share of pie
South Korea
Other considerations
FactorsdecreasingShare of pie
Consultant: Heng Liong
BCG
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Company
LOGO
Factorsincreasing
share of pie
Demand
Driven by Affluence
Preference for wide range,sophisticated product offerings
Up to 40% income tax
Record low interest rates
Consultant: Heng Liong
South KoreaBCG
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Company
LOGO
Other considerations
South Korea
Compliance with heightened regulation
Consultant: Heng Liong
BCG
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Company
LOGO
India
Smith Barney Potential
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Company
LOGO
Libe
ralizatio
n
WTO requirements
Consultant: Heng Liong
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Company
LOGO
Restricted Offshore
Banking
Limited direct foreign
participation in private
banking
Liberalization according
to WTO requirements
Entry of foreign
banks
Consultant: Heng Liong
BCG
F C i Si f Pi
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Company
LOGOFactors Capturing Size of Pie(+)
DemandLaborCost
Savings
Consultant: Heng Liong
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Company
LOGO
Consultant: Heng Liong
Demand private client businessis relatively new to Indiacompared to the morepopular retail banking
Tax rates up to 30%
Increasing Affluence
Factors Capturing Size of Pie(+)
BCG
C
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Company
LOGO
LaborCost
Savings
according to a studydone by DT, Foreign
banks such as Bank ofAmerica are predictedto outsource two million
jobs from the West toIndia by 2008 due to
labour cost savings ofup to 40%
Factors Capturing Size of Pie(+)
BCG
C
Factors Limiting Size of
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Company
LOGO
Regulations
Factors Limiting Size ofPie (-)
Intensityof
Rivalry
Consultant: Heng Liong
C
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Company
LOGO
Consultant: Heng Liong
Foreign banks face theconstraint of limitednumber of branches
DeploymentConcerns
Workers
productivity Leverage onExisting
Infrastructure
Regulations
Factors Limiting Size of Pie(-)
BCG
C
Deplo ment
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Company
LOGODeployment
Compan
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Company
LOGO
Before 2009, alreadyhave a number of
foreign banks in India.i.e. HSBC, JPMorgan.
by 2009, one of the
worlds best privatebank UBS
Intensityof
Rivalry
Consultant: Heng Liong
Factors Limiting Size of Pie(-)
BCG
Company
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Company
LOGO
InnovationPrivate Wealth
Sector
Deregulation
Competition
Consultant: Wendy
ConclusionBCG
Citi
grou
p
Company
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Company
LOGO
Q & A Session
BCG
Company
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Company
LOGO Index
WTO
Kyoto Protocol
Market Insights
China
India
South Korea Educational Levels
BCG
Company
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Company
LOGO
Education Level in South Korea in 200
13%
12%
43%
10%
22%Primary
Middle School
High School
College
University
South Korea Education LevelBCG
Company
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Company
LOGOBCG
Company
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Company
LOGOBCG
Company
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Company
LOGOBCG
Company
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Company
LOGO Growth of targeted markets
9.10%
4.60%
7%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
China South Korea India
GDP Growth
GDP
BCG
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