11,000 Jobs To Be Cut From Citigroup’s Workforce
Citigroup, Inc. is cutting 11,000 jobs from its workforce (or about four percent) and taking a $1 billion fourth-quarter charge.
According to Michael Corbat, Citi’s new chief executive, the top priority is to ensure Citi becomes more efficient. The bank has been facing an increase in pressure to reduce costs in order to boost returns.
The slash in jobs is expected to save the bank $900 million in expenses all through the bank’s businesses around the world. The hardest hit area of the reduction will be in the consumer banking sector. 35 percent of the charges and most of the layoffs will occur in consumer lending and branch banking. The move will reduce or eliminate consumer banking in the following countries: Uruguay, Turkey, Romania, Paraguay and Pakistan.
Branches are even going to be cut or close in the company’s top markets of the United States, Hong Kong, Hungary, Brazil and Korea.
1,900 jobs are set to be slashed in the capital markets and transaction processing unit. According to the company, 35 percent of the repositioning charge is linked to these businesses.
The job reduction is the first initial mark for the new CEO. Corbat wrote in a memo to his staff that changes would be made after he took time out to review the company and the structures.
Corbat took the helm after the former CEO Vikram Pandit suddenly and unexpectedly resigned from the position. Corbat has already spent a number of years at Citi, reducing the bank in its consumer lending businesses and getting rid of products linked to mortgages.
Before Corbat’s promotion, he was in charge of Citi Holdings, which was an operating unit Citi created to house businesses set for discarding.
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