Citigroup has announced that it will cut approximately 20,000 jobs over two years after Q4 downturn, in a sweeping attempt to streamline its operations following a “disappointing” fourth quarter of 2023 in which the firm reported a $1.8 billion net loss on revenues of $17.4 billion.
Announced during the group’s fourth quarter earnings call last week, Citi expects the cuts to approximately 10% of its workforce will generate run rate savings of approximately $2 billion, but that it could ultimately cost around $1.8 billion by the time the restructuring is completed in 2026.
The announcement comes after the US bank experienced its worst quarterly results in 14 years, with Citi CEO Jane Fraser saying the results are “clearly very disappointing”.
Citi attributes the loss to a variety of factors, including one-off costs relating to its reorganisation and retreat from Russia, and a nearly $900 million negative revenue impact as a result of the “larger than expected” devaluation of the Argentine peso.
Fraser asserts that “2024 will be critical” for the group as it continues to implement “simplifications” across its five core areas of business and “allocate capital with rigor”.
Its cost-cutting exercises so far include the divestiture of nine out of 14 of its consumer franchises, the retreat of its retail loans and deposits in China, Korea and Russia, and according to Fraser, the restructuring of its core businesses to “provide greater transparency into their performance”.
These latest restructuring efforts mark the group’s attempt, led by Fraser, to further harmonise key areas of its business. “We certainly aspire to be better,” Fraser says, “but the timing for a robust recovery is uncertain.”
