Citigroup's head of retail banking Jane Fraser will take the place of Michael Corbat as chief executive officer when he retires in February - making Fraser the first woman CEO of a large American bank.

The 53-year old Fraser, who has been with Citigroup for 16 years, has been a big name in the U.S. financial market, with an impressive resume in wealth management, credit cards, mortgages, investment banking and technology.

In her current capacity, she oversees the bank's consumer business in 19 countries around the world. Fraser has a Master of Business Administration degree from the Harvard Business School and a master's degree in economics from Cambridge University.

In addition to her upcoming role Fraser has also been chosen to be part of Citigroup's board of directors - effective immediately.

In a statement, Corbat said he had worked with Fraser for many years and that he was very proud to have her as his successor. With Fraser's brand of leadership, track record and values, "I know she will make an outstanding CEO," Corbat said.

Fraser's rise to the bank's top chief executive was acknowledged as a well-timed decision for an industry with just a handful of women leaders.

Her promotion was welcome, especially for Bank of America operations and technology director Cathy Bessant. "Great news for Citigroup and for women everywhere!" she tweeted.

For Citigroup board chairperson John Dugan, Fraser is "the right person to build on Mike's record and take the company to the next level." According to Equilar, Fraser will become one of 32 female chief executives in the S&P 500.

Shares of the New York-based Citigroup rose 43% during Corbat's tenure beginning in October 2012 compared with a 140% rise in JPMorgan shares in the same period. Citigroup's stock price was steady after the announcement.