Wealth management firms homing in on the $5- $25 million high net worth space tend to have “big armies on the field” and are therefore in a very profitable place. But this volume-based approach often relies on an “off-the-shelf” type of service and doesn’t marry well with customization – a big component of Citi’s UHNW offering, Charrington said at the bank’s New York office earlier this month.

There remains debate in the wealth management industry as to what is the “sweet spot” in terms of the most profitable client segment to cultivate, particularly as it is sometimes claimed that UHNW clients can be an expensive customer base to serve.

Charrington has worked at Citi since 1994 and became head of the North America private bank in June 2009, when Citi was selling the brokerage side of its business, Smith Barney, to Morgan Stanley.

He explained that the firm has moved away from being a distribution business having some 17,000 brokers, to one with around 175 bankers focused on larger - but fewer - UHNW clients and family offices.

“I think Citi has come a long way compared to a few years ago when its strategy was to try and be all things to all mankind. Our approach is now centered on being very specific about the type of clients we can serve, and knowing who we can’t – we don’t look after people with $5 million,” Charrington said.

“Everyone has a place to play and we know we compete with all of them; it depends on what we’re doing and who we’re serving. Say you’re one of our larger competitors, you’ve got a very big army on the field, so you’re going to need to go for volume. A lot of the industry is going after people with, say, between $10 million and $25 million. That’s a very profitable place to be, if, by and large, your services are effectively ‘off the shelf.’ But you’re not going to have a lot of customized offerings because customization kills that business.”

The average Citi Private Bank banker would have around 30-40 clients, while the average banker in a mass affluent business would probably look after 150-200, he noted.

“It’s a very different business model. I like to think of our business as a more boutique business with the benefits of a big global bank behind us we’re able to work with many of the world’s billionaires, whose pricing power is considerable, but whose needs are very different from those of the mass affluent.”

Indeed, Citi has been ramping up its UHNW team across the US in recent months.

This month alone it announced recruits at its Dallas, TX, office - Paul Cooke, Jake Trousdale and Sara Doutt - and Northern California office - William Epperson Giles and Steve Beverage. In August it also added Ryan McCleary and Blair Ege as directors and UHNW private bankers in Houston, TX, and Washington, DC, respectively.

Meanwhile, results on the private banking side have also been solid; net revenues at Citi Private Bank rose 9 per cent year on year from $591 million in the second quarter of 2012 to $645 million in Q2 2013. Revenues were up 3 per cent from this year’s first quarter, driven by North America and EMEA.