, Columnist
Wall Street Invaders Won’t Clear This Moat
Citigroup has a $715 billion buffer to hold back the covetous rivals such as Goldman Sachs eyeing its dominant transaction banking business.
Cleaning up by serving the detergent makers.
Photographer: Ramin Talaie/Bloomberg
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Supply-chain finance is the secret sauce behind Citigroup Inc.’s mid-20% return on equity from transaction banking.
That might sound counterintuitive, especially in Asia. The export-led region is facing the brunt of supply dislocations as the U.S.-China trade war intensifies. But the skirmish isn’t a showstopper for financing. As production moves from one country to another, transactions that need to be greased with money or credit will occur somewhere else. They won’t disappear.