Citi Introduces US Deposit Sweep Solution for Institutional Customers

Building on its established history of innovation in cash management, Citi’s Treasury and Trade Solutions recently announced the launch of a solution to enable institutional customers (Corporate, Public Sector, and Financial Institution) with U.S. accounts to “sweep cash into demand deposit accounts at participating U.S. branches of non-U.S. banks.”

Provided via IntraFi Network’s Yankee Sweep service, Citi’s (NYSE: C) institutional clients now “have additional flexibility to diversify their deposits across multiple institutions while enjoying an opportunity for enhanced yields.”

For treasury organizations, key aspects of proper liquidity management “include managing risk, counterparty exposure, daily liquidity, and optimizing yield.”

To achieve these targets, organizations would need to “manage cash across multiple banks and/or money market funds.” With Citi’s solution, institutional clients now have access to “a more streamlined experience to help them diversify their counterparty risk and maximize yields with the additional safety and security provided by a deposit solution.”

Michael Berkowitz, North America Head of Liquidity Management at Citi’s Treasury and Trade Solutions, stated:

“Citi is pleased to be the first bank in the U.S. to launch this solution in partnership with IntraFi, one of the most innovative companies in the FinTech Liquidity Management space. The new capabilities will help our clients balance competing demands for returns, risk management, and daily liquidity while simplifying the process to diversify their counter-party exposure.”

Available to Citi’s institutional clients with U.S.-based accounts, the new solution “provides several potential benefits,” including:

  • Competitive Yields: Participating clients are compensated with competitive yields relative to similar overnight products
  • Diversification: Deposits are split amongst banks in the destination bank network, providing greater bank diversification
  • Operational Efficiencies: Clients can place deposits with any of the destination banks in the bank network, simplifying the process to diversify their banking counterparties
  • Daily Liquidity: Deposits are accessible for same-day liquidity until the redemption deadline, without being subject to redemption gates, fees, or floating net asset values
  • Preservation of Capital: Though not FDIC-insured, funds are deposited with U.S.-chartered branches of foreign banks, subject to Federal Reserve Board oversight

Mark Jacobsen, CEO and Cofounder of IntraFi Network, remarked:

“IntraFi is pleased to be working with Citi as the first provider of the Yankee Sweep solution,. The new solution will give Citi the opportunity to offer clients even greater utility when managing their liquidity.”

Citi’s solution is available with planned expansion and enhancements throughout this year.

Berkowitz added:

“We are looking forward to building out our destination bank network to provide even more utility and choice for our clients,”

With extensive experience in transaction services, Citi has helped and “advised clients during high growth and challenging times.” Citi offers “one of the most comprehensive Liquidity Management networks in the industry, supporting over 30,000 regional and global liquidity structures for clients.”

Citi’s Treasury and Trade Solutions helps “enable clients’ success by providing an integrated suite of innovative and tailored cash management and trade finance services to multinational corporations, financial institutions, and public sector organizations across the globe.”

Based on the foundation of the industry’s largest proprietary network with banking licenses in over 90 countries and globally integrated technology platforms, Citi’s Treasury and Trade Solutions continues “to lead the way in offering the industry’s most comprehensive range of digitally enabled treasury, trade, and liquidity management solutions.”

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