The portfolio offering – Citi Portfolio Solutions powered by BlackRock – will combine the advisory capabilities of Citi with BlackRock’s investment management talent.
Citi Wealth clients will maintain their relationship with their Citi private banker who will advise on their asset allocation and long-term financial goals, while BlackRock will manage and implement specific investment strategies tailored to meet the clients’ objectives.
Under the agreement, BlackRock will manage a range of core, opportunistic and thematic investment strategies across equities, fixed income and multi-asset class strategies, with private markets to be added over time. Certain portfolio managers at Citi will now join BlackRock, and the two firms said new products and solutions are intended to be developed in due course.
Earlier this year, BlackRock identified bringing private markets to the wealth channel as a key driver of reaching its goal of doubling its market cap by 2030. This includes by providing personalised multi-asset wealth portfolios at scale with customised model solutions that incorporate public and private market investments.
The US asset manager said it already has over US$1 trillion in assets under management across its wealth channel and over 30,000 financial advisers using the BlackRock models in their portfolios.
It also wants to expand its private market capabilities through global credit investment manager HPS Investment Partners out to its established wealth network. HPS was acquired earlier this year and BlackRock aims to create an integrated private credit franchise known as Private Financing Solutions (PFS) with around US$220 billion in client assets which will combine private credit, GP and LP solutions, and private and liquid CLO businesses into one integrated platform.
Meanwhile, its Aladdin Wealth technology platform will also be deployed to Citi’s private bankers and investment professionals.
The agreement is expected to begin in the fourth quarter, subject to customary approvals and conditions.
Sir Robert Fairbairn, vice chairman at BlackRock, said: “We’re excited to be selected by Citi to bring BlackRock’s extensive suite of investment solutions and innovative financial technology to clients, enabling Citi to deliver customised portfolios and strong investment outcomes across wealth. As investor appetite grows for custom-built, whole portfolio solutions, BlackRock continues to invest in our global investment platform to stay at the forefront of clients’ evolving needs.”
Andy Sieg, head of wealth at Citi, said: “We want to bring best-in-class advice, solutions and service to our clients, and we want to serve more of the world’s changemakers. With this offering, we can accomplish both. It brings together the sophisticated relationship-driven and market-based advice of our bankers, backed by the insights of our own chief investment office, with the renowned investment expertise and innovative technology capabilities of BlackRock.”
