Citigroup cutting 11,000 jobs worldwide in efficiency drive

Citigroup cutting 11,000 jobs worldwide in efficiency drive

PanARMENIAN.Net - Citigroup says it is cutting 11,000 jobs worldwide in an efficiency drive, with most of the jobs being lost in its consumer banking division, BBC News report.

The bank said the move, which will see its headcount shrink by 4%, would cost it about $1bn (£621m) in pre-tax charges. Shares in the bank rose 7% following the announcement.

The move comes two months after the bank's former chief executive, Vikram Pandit, suddenly resigned. Michael Corbat took over from Pandit as chief executive.

The bank said the $1bn charge would be recorded in its fourth-quarter figures for this year. It said it would also add another $100m in charges to the first half profits for 2013.

Citigroup said the changes would leave it $900m better off in 2013 and a further $1.1bn the following year. The company said that about 25% of the charges for the fourth quarter related to its securities and banking division, with another 10% in transaction services.

Another third would come from reductions in its global consumer banking division, where 6,200 positions would be cut.

The banking group said it would be selling or scaling back consumer operations in Pakistan, Paraguay, Romania, Turkey and Uruguay.

Other countries affected by the changes would be Brazil, Hong Kong, Hungary, South Korea and the US.

It is also closing branches in Greece and Spain, countries hard-hit by the eurozone crisis. It intends to focus on the 150 cities that have the highest growth potential in consumer banking.

After the changes, Citi said it would have more than 4,000 retail branches around the world. At the time of Pandit's sudden departure, the bank's chairman, Michael O'Neill, said the departure was not due to any "strategic, regulatory or operating issue".

Pandit left the bank with a settlement of more than $15m. He resigned a day after Citi reported an 88% drop in quarterly profits to $468m.

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