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Citigroup to cut 11,000 jobs and take $1-billion charge

December 05, 2012|By Jim Puzzanghera
  • A Citibank branch office in San Rafael, Calif., in July. The company said Wednesday it would close dozens of branches in the U.S. and several foreign countries.
A Citibank branch office in San Rafael, Calif., in July. The company said… (Justin Sullivan / Getty…)

WASHINGTON -- Citigroup Inc. will cut 11,000 jobs and take a $1-billion pre-tax charge to its fourth-quarter earnings as it tries to reduce costs and reposition itself under new corporate leadership.

The job cuts -- including closing 44 U.S. consumer banking branches -- will save $900 million in 2013 and produce $1.1 billion in annual savings in 2014 and beyond, the company said in announcing the steps Wednesday.

"These actions are logical next steps in Citi's transformation," said Chief Executive Michael Corbat, who took over in October after the surprising departure of Vikram Pandit.

"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 said.

Citigroup stock was up about 4% in early trading Wednesday.

About 6,200 of the layoffs will come from Citi's consumer banking operations in the U.S. and around the world as the company focuses on the 150 cities with the "highest growth potential," it said. 

In addition to cutting 44 U.S. branches, Citigroup will close 14 in Brazil, seven in Hong Kong, 15 in South Korea and four in Hungary. The company also said it expected to "sell or significantly scale back" its consumer banking operations in Pakistan, Paraguay, Romania, Turkey and Uruguay.

Other cuts include 1,900 jobs in its group serving institutional clients.

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