Citigroup Implements CEO Jane Fraser’s Corporate Restructuring, Slashing 10% of Workforce.
Citigroup CFO Mark Mason announced on Friday that the company will undergo significant downsizing and plans to lay off 20,000 workers over the next two years. The decision follows Citigroup’s fourth-quarter 2023 financial report revealing a net loss of $1.8 billion — the company’s worst quarterly performance in 15 years.
Anticipating long-term financial benefits, the bank estimates that the reduction in staff will result in $2.5 billion in savings. However, the reported fourth-quarter earnings loss of $1.16 per share was significantly higher than the FactSet estimate of a loss of 11 cents per share.
Read More: Usher’s Super Bowl Halftime Show Teaser Highlights a Performance Three Decades in the Making
Several one-time costs contributed to the disappointing results, including a $1.7 billion charge related to the regional banking crisis, an $880 million loss in Argentina and $800 million in restructuring costs related to approximately 7,000 layoffs in 2023.
The job cuts are part of Citigroup CEO Jane Fraser’s ongoing initiative to streamline the company, cut red tape and improve profitability. Despite calling the results “very disappointing”, Fraser expressed optimism on a call Friday morning, saying 2024 would be a “breakthrough year” for the nation’s third-largest lender.
Mason acknowledged the impact of such workforce reductions on morale and emphasized the clarity of the company’s strategy and expected momentum. In addition, Citigroup disclosed plans to divest 40,000 employees from its Mexican retail unit through an IPO, reducing its total workforce from 240,000 to about 180,000.
In the coming years, the bank expects to spend up to $1 billion on severance and reorganization costs related to the restructuring. The layoffs are part of a global strategy, and the bank declined to provide a breakdown of the numbers by region.
Chief executive Jane Fraser first unveiled her comprehensive restructuring plans in September, highlighting the need for a leaner staff to reshuffle management, increase accountability and improve share prices.
A correction to earlier versions of this story clarified that Citigroup’s layoffs are happening around the world. Despite the announcement, Citi shares were down 1.2% in afternoon trading.
