Citi CEO Jane Fraser: 'We have to beat the best' as turnaround pays off

Citigroup just posted its best third-quarter revenue in a decade, and CEO Jane Fraser says the turnaround's heaviest work is done. "We're definitely in the more fun part of everything that's going on. We've got a lot of the heavy lifting behind us," Fraser said Wednesday, appearing virtually at Fortune's Most Powerful Women Summit in conversation with leadership editor and summit co-chair Claire Zillman.

The numbers back her up. Wednesday's earnings report capped a run that has made Fraser's overhaul of the bank one of Wall Street's clearest restructuring stories. She became CEO in 2021 as the first woman to run a major Wall Street bank, and she now sits at No. 1 on this year's Most Powerful Women list.

Her message to the firm for the next phase is blunt. "Now what I've said to the firm is, if we are going to be the best in the businesses we're in, we have to beat the best," Fraser said. "So it's that mindset of excellence, and that's the next phase of the journey."

What did the restructuring actually change?

When Fraser took the top job in 2021, she inherited an expansive global bank that had lost focus. Her response was radical simplification. She reorganized Citi into five core businesses, cut layers of management, and started exiting consumer banking in 14 markets outside the U.S.

The overhaul also includes 20,000 job cuts, slated to wrap up before 2027. That scale of restructuring demanded hard decisions delivered to thousands of employees, and Fraser has built a management philosophy around doing it without brutality.

"I think you can make tough decisions. It does not mean you need to be an asshole," Fraser told Zillman in an interview this spring, reflecting on five years into her tenure. On Wednesday, she traced that philosophy back to a restructuring she once led in Citi's mortgage business. Employees want to hear "the hard truth," she said, paired with what the company will do to help them.

"You do not have to be tough and unpleasant about it, but you do have to be straight," she added.

How does AI fit into Citi's next phase?

Like most large financial institutions, Citi's next phase hinges on how AI reshapes the business. Fraser frames AI's impact in three parts: it "can help you earn money. It can help you save money. It can help you secure the bank."

"We have to move fast and retain trust," she said.

The most concrete example is already live. Citi's wealth business has unveiled an AI avatar agent, developed with help from Google DeepMind's team, that can talk with clients at any hour of the night — "when our bankers hopefully are getting some beauty sleep," Fraser said. She was quick to draw its boundaries: "it's not a replacement team member."

That caveat matters, because whether AI will shrink Citi's headcount remains unresolved. "Honestly, we don't know yet," Fraser said. She described "puts and takes" — some jobs created, others automated as the technology spreads through the bank.

Is Citi training its workforce for AI?

Yes, at massive scale. Citi now requires AI training for 175,000 of its employees, with a focus on writing prompts. Fraser sees preparation as the antidote to workforce anxiety about automation.

"I never think people perform well if they're fearful," she said.

The training push reflects a bet that employees who understand the tools will adapt as roles change, rather than resist them. It also signals that Fraser views AI competence as a baseline skill across the bank, not a specialty confined to technology teams.

What about AI risk and cybersecurity?

Speed cuts both ways, and Fraser acknowledged that innovation brings exposure. "When you're innovating at speed, you have to manage risk at the same speed," she said.

Her approach to cyber risk is notably collaborative. Big banks are working together to find and patch vulnerabilities, she said, because cyber defense isn't a competitive arena.

"You don't compete on cyber," she said. "You collaborate on cyber."

That stance carries weight coming from the CEO of one of the largest U.S. banks, and it aligns with a broader industry pattern of sharing threat intelligence even among fierce rivals for deposits and deal flow.

What comes next?

Fraser's framing marks a shift in tone for a bank long defined by its fix-it phase. The restructuring metrics are largely behind her: five core businesses, 14 consumer market exits, 20,000 job cuts closing out before 2027. What remains is the harder test — whether a simplified Citi can outcompete the strongest players in the businesses it kept. As she put it, the goal now is to "beat the best," and the bank's next several quarters will show whether its best-in-a-decade revenue run was the finish of one journey or the start of another.