Citi Hands $80B in Wealth Assets to BlackRock for Management
What the Deal Involves
BlackRock has struck a deal with Citigroup to manage about $80 billion in assets on behalf of Citi’s wealth management clients, the bank said Thursday. The arrangement transfers a large portion of Citi Investment Management’s (CIM) mandate to the world’s largegest asset manager while leaving Citi’s private bankers in charge of client advice, asset allocation, and strategy selection.
The agreement, set to begin in the fourth quarter of 2025, builds on an existing relationship between the two firms. BlackRock already overviews part of Citi’s $635 , according to Bloomberg. As part of the new deal, some CIM portfolio managers will move to BlackRock to continue managing client money under the expanded mandate.
Investor Takeaway
Why Citi Is Handing Off $80B
The decision reflects a broader to streamline wealth management units and focus on higher-margin services such as financial planning and client advisory. By outsourcing investment management, Citi expects to lower expenses and improve efficiency. “It is also a way for Citi to get further efficiency gains very rapidly since this outsourcing can drop expenses,” said Christopher Marinac, director of research at Janney Montgomery Scott.
The move aligns with CEO Jane Fraser’s restructuring drive, aimed at simplifying Citi’s global operations and bolstering returns in areas like wealth management, where competition for affluent clients is intense. Citi’s private bankers will continue to lead client relationships while leaning on BlackRock’s scale and .
BlackRock’s Strategic Win
For BlackRock, the deal means both a near-term inflow and long-term potential. In addition to managing Citi’s transferred assets, BlackRock will roll out its Aladdin Wealth banking teams, embedding its technology into the bank’s wealth management infrastructure.
The partnership also positions BlackRock to gain exposure to Citi’s private-markets strategies, an area where it has aggressive growth ambitions. BlackRock has set a target of $400 billion in cumulative private-markets fundraising by 2030, part of a push to diversify beyond lower-fee index funds that have pressured margins. In June, it unveiled plans to include private assets in its retirement products, a segment that accounts for over half of its $10+ trillion in assets under management.
Investor Takeaway
What’s Next for the Partnership?
The deal underscores a growing trend in financial services: banks focusing on client-facing roles while leaning on scale players like BlackRock to handle portfolio management. Analysts will be watching whether Citi follows up by outsourcing additional mandates, and whether BlackRock leverages the partnership into a broader private-markets distribution pipeline.
For Citi, success will be measured in leaner operations and improved profitability. For BlackRock, the partnership provides both stable inflows and a strategic foothold in Citi’s wealthy client base—resources that could prove valuable as competition in global wealth management intensifies.
