Citi Slashes 11K Jobs Including 2,600 Ops and IT Positions
The battered Citigroup announced on Wednesday that it will eliminate 11,000 jobs, reducing its workforce by nearly 4 percent in an effort to cut costs. About 40 percent of those layoffs - 2,600 jobs -- will be in technology and operations support areas, according to new reports.
"These actions are logical next steps in Citi's transformation," Citi CEO Michael Corbat said in a press statement. "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."
Corbat replaces the embattled Vikram Pandit who resigned in October.
Industry observers suggest that the massive layoffs combined with a quarterly write down of $1 billion, were inevitable. "Corbat has a limited window of opportunity here in which he can make his new CEO moves," Nancy Bush, a bank analyst, tells Reuters. Given the mandate he has to act, she said, "you might as well get the shocking numbers out first."
That said, Bush expects Citi to cut even more jobs in the coming two years. "I look at this as the first cut," she said. "Corbat will be forever digging and looking for places to cut, and inevitably personnel will be the biggest part of that."