Citibank Private Bank is on the verge of landing its first UK client after being approached by Herbert Smith, which is currently reviewing its banking services.
Citibank has been contemplating a UK launch for its law firm group over the past year in a bid to mirror its US arm, where it has the biggest market share in the sector.
However, its plans have gained momentum after the approach from Herbert Smith, which is reassessing its long-standing relationship with Coutts & Co in view of the firm’s international expansion.
Citibank will launch the service between April and June next year, operating from existing Citigroup offices in the City, although a later move to Canary Wharf is possible if demand is sufficient.
The move into the UK legal market will bring Citibank into direct competition with Barclays Bank and the Royal Bank of Scotland (RBS) Group, which are currently the leading bankers for law firms.
Robin Balding, managing director of Citibank’s law firm group, says: “From a product point of view, there aren’t lots of things we do that others can’t. But the one thing we do bring is 200 professionals who do nothing else but service law firms day in and day out.
“Our competitors are both capable and knowledgeable and will do what their clients want, provided it is the right thing. But I’m not so sure they have the breadth to be able to suggest that there might be a different way of doing things.”
However, John Robinson, relationship director in the professional practices team at Barclays, says: “Like anyone whose market is threatened, we will defend our position fiercely. Our aim is to pick up new business, but also to keep what we’ve got.”
Barclays is the primary banker for 33 of the top 100 UK firms, six of which are in the top 10. It is also primary banker for the London offices of 16 US firms.
Barclays also has a best friend’s relationship with Chase Manhattan and makes regular trips to New York to pitch to potential clients in the legal sector.
Hugh Biddell, corporate director in professional services at the RBS Group, says: “We always have competition and we expect to get competition from new entrants to this market, but we don’t intend to sit back on any market share that we’ve got.”
Biddell says that RBS and NatWest banks for most of the top 25 firms in the City and for more than half of the top 100 firms, although not exclusively. The RBS Group also banks for a number of US firms in the UK.