Citi's big question: How much is it paying for all these new MDs?
How much is Vis Raghavan, head of Citi's investment bank, spending on all his new senior bankers?
As Raghavan recruits more and more senior people to Citi's investment bank, his hiring budget is a source of speculation, both at Citi and beyond.
Raghavan only arrived at Citi from JPMorgan in July 2024. Since then, he's added at least eight senior people from JPMorgan, including - most recently, we understand, - Nicolas Skaff, JPMorgan's London- based head of EMEA private capital markets. JPMorgan insiders say this understates the full extent of Raghavan's poaching aspirations and that various other JPMorgan managing directors (MDs) are also in the process of moving to Citi, but have not finalized their resignations yet.
Why would people move from JPMorgan to Citi? Dealogic says JPMorgan is first for investment banking revenues this year, and that Citi is only fifth. The exodus may be down to loyalty to Raghavan, who spent 25 years at JPMorgan before joining Citi, but the suspicion is also that JPMorgan insiders are being given significant financial inducements to join their friend.
Citi declined to comment on the rewards that Raghavan's offering his new hires. Inside JPMorgan, there are rumours that they include much higher salaries and guaranteed bonuses. One former Citi managing director says the bank has traditionally paid high salaries in London, without additional allowances, and £400k+ is not unusual. JPMorgan MD salaries are though to be £300k, plus bonuses.
Raghavan himself is very well rewarded at his new employer. Citi revealed in regulatory filings that it paid him $40m to buy out the stock he left at JPMorgan and another $23m in salary and bonus for less than six months work in 2024. By comparison, Citi CEO Jane Fraser earned $34.5m for the full year last year.
Alongside his array of JPMorgan hires, Raghavan has also added Ed Sankey from HSBC, Jamie Manson-Bahr from Morgan Stanley, David Friedland and Vikram Chavali from Goldman Sachs, Deepak Dangayach from Deutsche Bank and Aashish Dhakad from Ares.
Raghavan's new hires are senior staff at managing director level, many are heads of business. At a minimum, they are likely to have cost Citi $30m. At a maximum, it could be multiples of that. Dhakad in particular is unlikely to have come cheaply. Nor will Achintya Mangla, Dhakad's boss.
The spending spree is raising eyebrows at Citi, where senior insiders say their bonuses have been curtailed for years as Fraser cuts costs. There are suggestions that job cuts are coming next in August to help pay for the new people. Some welcome this, saying that Citi needs to clear its disaffected senior ranks.
Raghavan said in June that he was only just getting started with his investment in talent. Fraser seems to be fully supporting him in his spending spree. Hiring from JPMorgan is seen as a plus, and reflects well on her as CEO. Speaking to Euromoney last month, Tim Ryan, head of technology and business enablement, said: “One of Jane’s real strengths is that she has an extraordinary ability to attract talent to the firm.”
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