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Citi Cuts 4,500 Jobs, Will Take $400M Charge

07 December, 2011

Citigroup Inc is cutting 4,500 jobs worldwide, Chief Executive Vikram Pandit said on Tuesday, becoming the latest large bank to trim staff.

Pandit, speaking at the Goldman Sachs Financial Services Conference, said the bank would record a $400 million charge in the quarter for severance and other expenses related to the layoffs.

The cuts are equal to about 2 per cent of Citi’s workforce of 267,000 employees at the end of third quarter 2011.

Pandit said the cuts would be completed over “the next few quarters” and would come from a range of businesses.

Citi joins other banks worldwide that have cut more than 120,000 jobs as regulations have imposed tighter industry rules and the economy remains weak.

Earlier this year, Citi rival Bank of America Corp announced plans to cut 30,000 jobs and slash $5 billion in annual expenses as part of a program known as ‘New BAC,’ a play on the company’s ticker symbol.

Pandit said Citi’s reductions would involve its proprietary trading units, which are being wound down.

The 2010 Dodd-Frank financial reform law features a provision known as the Volcker Rule that limits banks from betting their own capital in the market.

Pandit also said Citi’s expense previously disclosed expense reduction program generated $1.4 billion in savings so far this year, nearly 4 per cent of the bank’s $37.72 billion of operating expenses in the first three quarters.

Citigroup shares closed down 8 cents, or 0.27 per cent, at $29.75 on the New York Stock Exchange.

 


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Citi Cuts 4,500 Jobs, Will Take $400M Charge

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