Citigroup's M&A Surge Drives 84% Fee Increase in Q1 2025, Ranked 4th Globally in Investment Banking Market Share

On June 20, 2025, Citigroup's trading volume reached $803 million, marking a 29.74% decrease from the previous day. The stock closed with a 0.13% increase, marking its second consecutive day of gains, with a total increase of 1.41% over the past two days.

Citigroup has made a significant move in its mergers and acquisitions (M&A) division by hiring Drago Rajkovic as its co-head of M&A. Rajkovic, a veteran with three decades of experience, will work alongside Kevin Cox and report to Vis Raghavan, the head of banking at Citigroup. This strategic hire is aimed at capturing a larger share of the M&A market, which is currently valued at $1.5 trillion. Rajkovic's extensive experience in tech and corporate M&A is expected to align with the surging demand for cross-border and sector-specific expertise.

Rajkovic's appointment underscores Citigroup's focus on high-value advisory services, a sector where fees can significantly increase for banks that dominate marquee deals. His experience includes advising on megadeals such as Salesforce's $8 billion acquisition of Informatica and HP's $14 billion purchase of Juniper Networks. This hire is part of a broader talent overhaul led by Vis Raghavan, who has also brought in Achintya Mangla as the financing head. The co-leadership model between Rajkovic and Cox is designed to create internal competition, driving performance and growth.

Citigroup's Q1 2025 M&A performance was particularly strong, with an 84% surge in fees. This growth was driven by successful deals such as advising Charter Communications on its $21.9 billion merger with Cox Communications and Boeing on its $10.5 billion sale of Jeppesen to Thoma Bravo. The bank's 4.8% global investment banking market share in 2024, up from 3.5% in 2020, reflects the early success of Raghavan's strategy. The bank's focus on cross-border deals and its $1.3 trillion underwriting capacity position it to capitalize on rising global deal flows.

Despite some underperformance in its debt capital markets unit, Citigroup's strategic focus on M&A, where margins are 2-3 times higher, suggests a prioritization of high-margin segments. The bank's stock trades at 1.2 times book value, a 15% discount to peers like JPMorgan and Goldman Sachs. Analysts project Citigroup's return on equity (ROE) to rise to 12% by 2026, supported by its robust capital buffer. For investors bullish on M&A activity, Citigroup offers leverage to this theme, with the potential for significant growth in M&A revenue over the next two years.