The Motley Fool

Is this global banking giant about to disrupt ANZ, CBA, NAB, & Westpac?

The recent successful initial public offering of small business lender Prospa Group (ASX: PGL) looks set to strengthen its position at the small end of the commercial lending market.

This could lead to the growing fintech company taking market share away from the likes of Australia and New Zealand Banking Group (ASX: ANZ), Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), and Westpac Banking Corp (ASX: WBC)

Unfortunately for the big four banks, Prospa isn’t the only company looking to steal market share away from them. One of the world’s largest global banks has revealed that it has its eyes on the Australian commercial banking sector as well.

Who is coming after the big four?

According to an AFR report, Citi is ramping up its operations targeting high-growth companies with international aspirations.

The global banking giant plans to take on the big four by offering business customers who operate in multiple jurisdictions the convenience of a single banking partner. It also intends to compete sharply on price.

Citi’s head of commercial banking in Australia, Alex Syhanath, told the media outlet that it will be targeting companies turning over $250 million to $1 billion a year. He also revealed that the bank will be targeting companies outside the mining, resources, and property sectors.

Mr Syhanath appears to believe that the big four have focused too much on property and have let their core banking skills slip, opening up an opportunity for fintech companies and global banks.

He said: “You see fintechs like Greensill for instance. They are targeting this mid-market quite heavily and the reason they are doing so well is because the incumbents aren’t doing so well or paying attention to what the opportunity is.”

The global banking giant advised that it has signed up eight customers since February and has a strong pipeline of prospective customers. New customers include the likes of Luxury Escapes and fashion retailer Showpo.

What now?

Whilst the loss of any kind of market share is never a good thing, I think it’s a little too soon to panic about Citi’s move. 

In light of this, I’m not overly concerned by this news and continue to see the banks as buys at their current levels.

But which bank should you buy? This one was recently rated as a buy and named the best bank share on the ASX.

The Motley Fool’s #1 BANK STOCK for 2019

BRAND NEW! For a limited time, The Motley Fool Australia is giving away an urgent new investment report with all the details on our #1 BANK STOCK for the next 12 months and beyond…

Now, if you’ve been around this site for any length of time, you know The Motley Fool usually shuns bank shares.

But we’ve recently discovered a ‘hidden in plain sight’ bank stock with what we think is mouth-watering potential.

With the company boasting nearly 25% net profit growth every year for the last 5 YEARS…

And the shares paying a fully franked dividend that beats the pants off term deposits!

So if you like steady, high-growth income plays – we’ve got you covered!

You’re invited. Simply click the link below to discover our #1 ASX bank stock to profit in 2019. To scoop up your FREE copy, simply click the link below right now. But you will want to hurry – this free report is available for a brief time only.


Motley Fool contributor James Mickleboro owns Westpac shares. The Motley Fool Australia owns shares of National Australia Bank Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

NEW. Five Cheap and Good Stocks to Buy in 2019…

Our Motley Fool experts have just released a brand new FREE report, detailing 5 dirt cheap shares that you can buy today.

One stock is an Australian internet darling with a rock solid reputation and an exciting new business line that promises years (or even decades) of growth… while trading at an ultra-low price…

Another is a diversified conglomerate trading near a 52-week low all while offering a 2.8% fully franked yield…

Plus 3 more cheap bets that could position you to profit over the next 12 months!

See for yourself now. Simply click the link below to scoop up your FREE copy and discover all 5 shares. But you will want to hurry – this free report is available for a brief time only.