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Citizens Financial says it has opened its first private banking office in Boston and plans to launch several more later this year.
Alex Kent/Bloomberg
Citizens Financial Group has brought on two JPMorgan Chase executives and opened its first private banking office as part of a strategy it debuted last fall to expand wealth management and private banking services.
The Providence, Rhode Island-based bank has hired Michael Cherny as head of wealth management advisors and Tom Metzger as head of private wealth managers. Both executives came from JPMorgan and in their newly created roles will help lead Citizens' private bank, which launched in October. Citizens also planted a private bank flag in Boston to cater to ultra-high-net-worth clients and family offices, with plans to open several more offices later this year in Florida and California.
The expansion marks Citizens' latest play to reel in business from clients of regional banks that failed last year, many of which had major wealth management operations.
"Our point of view is that sometimes great banks are made in moments of crisis, and that's the way we played it," said Brendan Coughlin, Citizens' head of consumer banking, which includes wealth management. "We saw a really strong offensive opportunity with the disruptive market to take some market share and build out a great part of the franchise."
Citizens Private Bank had drawn in $1.2 billion of deposits by the end of 2023, 30% of which are non-interest-bearing, the bank said in its fourth-quarter earnings report. Some 75% of those deposits are from commercial clients. By the end of 2025, Citizens is aiming to add $11 billion of deposits, $9 billion of loans and $10 billion of assets under management on the wealth management platform, Coughlin said.
The bank spent last year building its private banking platform and team and is now focused on hiring more folks for the wealth management side of the business, Coughlin said. His comments came in an interview Friday, a day after the announcement of the hires of Cherny and Metzger.
The $220 billion-asset-bank said Cherny, a 30-year JPMorgan veteran, is responsible for growing Citizens' "mass affluent and affluent" client relationships across the country. In his previous role at JPMorgan, Cherny led consumer banking and wealth management in New York, one of that company's largest regions consisting of $60 billion of investment and deposit balances, Citizens said.
Metzger joined Citizens after leading wealth management recruiting at First Republic Bank, which failed in May and was acquired by JPMorgan. The new head of wealth managers will recruit and lead private wealth managers focused on new-to-bank clients in "key geographies," Citizens said.
Citizens Bank reduced its workforce by 3.5% in the fourth quarter
Cherny and Metzger's appointments come after Citizens' addition of about 200 bankers to the private bank last year, of whom "a vast majority" came from San Francisco-based First Republic Bank after it collapsed, according to Coughlin. Citizens noted in its recent expansion announcement that its private wealth offices would offer freshly baked cookies and branded umbrellas, perks that First Republic was known for before its collapse.
Citizens had originally tried to acquire part of Silicon Valley Bank, which failed in March, and then all of First Republic Bank. While those attempts fell through, Coughlin said the bank realized there was an opportunity to capture talent.
The head of Citizens' private bank, Susan deTray, had previously been deputy chief credit officer and head of credit administration at First Republic.
Citizens first previewed its private bank game plan at an industry conference in September, naming the strategy as one of its top priorities after its acquisition of two wealth management firms in 2018 and 2022.
"We've made no secret about our desire to continue to grow our wealth management franchise over the last few years," Coughlin said in the September presentation. "We aim to bring together the breadth of the bank … to the client in a single, integrated client experience."
Banks have been working to enhance their wealth management offerings as demand for "one-stop shops" of financial services mounts, according to a McKinsey report last month.
Coughlin added in September that 2023 was a "year of investment" for the bank and that the private banking strategy would allow it to "play with the big boys over time."
He reiterated in the interview Friday that wealth management was deemed one of the bank's strategic pillars for Citizen's growth last year.
"We're going to continue to keep investing in it," Coughlin said. "Our wealth management strategy is at the very top of the list of the things we're working on."
Update
This story was updated on Feb. 9, 2024, to include comments from an interview Friday with Brendan Coughlin, Citizens' head of consumer banking. It was updated again on April 18, 2024, to clarify that while Michael Cherny and Tom Metzger were given key roles within Citizens' private bank, Susan deTray is the head of the private bank.
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