US banking giant Citigroup has established a new Financial and Strategic Investors (FSI) group within its investment banking division, replacing its former Global Asset Managers unit, as the firm repositions to capture rising deal activity across financial sponsors, sovereign wealth funds, and family offices.

Reuters reported that the restructure was communicated via an internal memo from Citi's head of banking and executive vice chair Vis Raghavan, and that the new group will be co-led by three executives: Michael Marcus and Michael Quadrino in New York, and Klaus Hessberger in London.

Hessberger joins from Lazard, where he served as global co-head of Financial Sponsors, bringing more than three decades of industry experience including 25 years at JPMorgan Chase. He had joined Lazard only last July following his departure from JPMorgan.

Current Global Asset Managers leader Ashu Khullar will step down from his role and explore other senior positions within the firm.

Citi is also establishing Global Infrastructure Coverage as a standalone vertical, to be led by Todd Guenther, in response to heightened activity in infrastructure finance globally.

The restructure reflects intensifying competition among major investment banks to secure mandates from private equity sponsors and alternative asset managers, as deal-making activity is widely anticipated to accelerate through 2026 following a prolonged period of subdued transaction volumes.

The move also follows a broader trend of senior talent movement across financial sponsors coverage desks, with Barclays separately hiring Erkin Yildiz from Jefferies to lead its financial sponsors business in EMEA, and Nomura recruiting Benjamin Moureaux from HSBC earlier in the year.

For accountancy and financial advisory firms servicing mid-market and institutional clients, the restructuring of major banks' sponsor coverage capabilities has direct implications for deal pipeline, capital raising activity, and advisory mandates.

Read the full report on Citigroup's investment banking restructure.