Citigroup is shortening the time it takes for junior investment banking analysts to advance to associate level as part of efforts to retain talent amid intense competition in the financial sector. The company will reduce its analyst programme from three years to two, effectively cutting the total expected timeline from analyst to vice-president from six and a half years to five and a half, according to an internal memo.

This adjustment aligns Citi with other Wall Street firms, where two-year analyst programmes are more common. The move is intended to enhance retention by offering faster career progression at a time when private equity firms and other competitors have been actively recruiting junior bankers, often before their training programmes officially begin. Some private equity firms had previously hired candidates shortly after their college graduation, well before their scheduled start dates at banks, prompting backlash in the industry. Last year, several such firms abandoned these early hiring practices during the traditional June recruitment window.

Citi's decision follows similar moves by peers including JPMorgan, which has reduced its promotion timeline to about two and a half years and warned that junior analysts who accept future-dated jobs within 18 months of joining could face termination. JPMorgan and others have also introduced policies requiring employees to disclose any accepted external offers.

Banks are increasingly focused on extending analysts’ tenure beyond the typical two-year cycle, aiming to build longer careers rather than accepting frequent departures after initial programmes. This shift reflects challenges in sourcing intermediate talent as interest in MBA programmes wanes and private equity faces pressures from increased competition and declining profit margins, which have historically supported junior staff compensation.

Historically, investment banks have adjusted promotion paths in response to market dynamics. For example, during the late 1990s tech boom, banks accelerated advancement to compete with startups. More recently, during the surge in dealmaking activity in 2021, firms increased promotion speed and benefits to address employee concerns over remote work demands.

In addition to shortening the analyst programme, Citi will eliminate fixed-term employment contracts for investment banking analysts in North America, removing predetermined end dates from their agreements. The changes aim to make banking careers more attractive and competitive amid an evolving talent landscape.