Alex Samuelson, a spokesman for Citigroup, said it is too early in the process to provide further details about the transition.
The bank's overall strategy is to provide clients with a deeper relationship with their financial advisors, to offer more complex services and be a higher-end brokerage. A fee-based model provides a steadier revenue stream and often leads to consolidating more of clients' assets. Meanwhile, the pricing of transaction fees continues going down throughout the industry.
Some advisors are feeling pressure to move clients to fee-based accounts when it might not necessarily be in their best interest so they can get the bigger paycheck. But if clients move to a fee-based account and don't like it, they can get a rebate.
The industry has been moving in a fee-based direction for years. Citi expects the top wirehouses to follow in the same direction, only Citi will be able to execute its strategy faster since it has so few advisors compared the wirehouses with tens of thousands.
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