Citibank

In: Business and Management

Submitted By hale
Words 957
Pages 4
With pressure mounting from shareholders, Citi has been trying to bolster returns, in part by working through a glut of bad loans and systematically dismantling some businesses. The job cuts amount to 4 percent of the work force and will bring the company’s head count down to about 250,000, down by a third since before the financial crisis in 2007.

The bank’s shares increased more than 6 percent on Wednesday.

The moves, the first since Michael O’Neill, the bank chairman, abruptly deposed Vikram S. Pandit as chief executive and replaced him with Michael L. Corbat, were seen as another retrenchment from Citi’s former position as a financial megamarket in the United States and around the world. But the announcement did not signal a new strategy or direction for the nation’s third-biggest bank by assets.

“Ultimately, it misses the point,” said Michael Mayo, an analyst at Crédit Agricole Securities. “They need a more radical restructuring.”

Since the abrupt power change in October, which sent shock waves across Wall Street and left some within the bank rankled by the brutal transition, there has been unease throughout the upper ranks of Citigroup, according to several people close to the bank.

Much of that wariness stemmed from a concern that Mr. O’Neill would work through the new chief executive to impose an unflinching round of cuts that further pare down the bank, according to these people.

A career banker and Marine, Mr. O’Neill had tussled with Mr. Pandit over the lack of speed in trimming costs after taking the helm of the board in 2009, according to several people close to the board.

The latest cuts come after exhaustive meetings in November that convened nearly every head of the bank’s businesses at Citigroup’s Park Avenue headquarters in New York, according to several senior executives at the bank. During the meetings, which lasted for three…...

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