Citigroup is getting out of the master trust business in the U.S. The firm sent a letter to its U.S. pension fund clients informing them that it would close the business at the end of this year. The firm will continue offering its trust and pension servicing businesses to clients outside the U.S.
Spokeswoman Nina Das said about 80 clients would be affected. Those clients collectively have about $65 billion in assets under custody, whereas Citi has a total of $13 trillion in global assets under custody.
Once Citi acquired BISYS Group, which provides fund servicing, Citi decided to leave the master trust services business, Ms. Das said.
A consultant covering the custodial industry said the move was not a surprise, given the companys financial troubles. Citigroup overall is clearly having a lot of problems with their balance sheet, said the consultant, who asked not to be identified. If it wont provide long-term growth or theyre not a leader, theyre getting out of it.