Citigroup to Cut 11,000 Jobs


Citi to Cut JobsThis post originally appeared on Business Insider.

Citigroup is going to cut 11,000 jobs, the bank said in a release.

As a result of the job cuts, the bank expects to take a fourth-quarter pre-tax charge of $1 billion and $100 million in related charges in the first half of 2013.

Glancing over the release, it looks like most of these cuts will hit the bank’s foreign operations, especially the operations and technology departments.

The bank identified these as areas that do not provide “for meaningful returns,” the CEO said in a statement.

Citigroup has a new CEO, Michael Corbat, who took over the helm back in October after Virkam Pandit resigned suddenly.  This is his first real big move as CEO.

Shares of Citi were last trading up more than 3% in the pre-market.

Here’s the release:

Citigroup today announced a series of repositioning actions that will further reduce expenses and improve efficiency across the company while maintaining Citi’s unique capabilities to serve clients, especially in the emerging markets. These actions will result in increased business efficiency, streamlined operations and an optimized consumer footprint across geographies.

Michael Corbat, Citi’s Chief Executive Officer, said, “These actions are logical next steps in Citi’s transformation. While we are committed to– and our strategy continues to leverage– our unparalleled global network and footprint, we have identified areas and products where our scale does not provide for meaningful returns. And we will further increase our operating efficiency by reducing excess capacity and expenses, whether they center on technology, real estate or simplifying our operations.”

Due to this repositioning, Citi expects to record pre-tax charges of approximately $1 billion in the fourth quarter of 2012 and approximately $100 million of related charges in the first half of 2013. Citi currently expects that the repositioning will generate $900 million of expense savings benefitting 2013 results and that the annual expense savings will exceed $1.1 billion annually beginning in 2014. Citi also expects the repositioning actions to have a negative impact on annual revenues of less than $300 million. These actions will result in a reduction of more than 11,000 positions.

Citi expects the repositioning activity to affect the following businesses and functions:

Posted in: