Citigroup's Chairman and Chief Executive Officer Charles 'Chuck' Prince has decided to invest $10 million of his personal wealth in India to set up a retail broking company, and that too in a joint venture with his group.
Prince will hold a majority stake in the non-banking financial company (NBFC) whose name has not yet been announced, but industry sources told Hindustan Times that it may be named Citbank Worldwide Retail Services.
Prince is not the first global banking chief to put his personal money and focus on India. He follows Standard Chartered Bank's Rana Talwar who acquired a controlling stake in Centurion Bank after his foray in 2003. But Talwar is Indian.
A Citigroup spokeswoman declined to comment on Prince's venture, but she confirmed that the group had started a play to venture into retail broking that would include the selling of financial instruments such as mutual fund schemes or insurance products.
"The investment by Chuck Prince is a reflection of India's growth story," said a top investment banker, who did not wish to be identified.
Under Prince's proposed plan, the new venture will start 42 branches in the first phase of 12 months and over the next three years, it would have 100 branches across the country. Citigroup currently operates a stock broking business under Citigroup Global Markets brand which addresses institutional investors.
Prince's venture is likely to target individuals. However, Citibank, through its branch network, sells mutual fund and insurance products. Sources said that new business would be completely separate from this and would target new customers.
Prince began his career in 1975 as an attorney at the U.S. Steel Corporation and in 1979 joined Commercial Credit Company (a predecessor company to Citigroup). He rose through the group's ranks and became CEO in 2003, and was named chairman in 2006.