Citigroup plans to eliminate some 20,000 jobs by the end of 2026, marking the next phase of the bank’s most dramatic restructuring plan in decades. The cuts will trim about 10% of Citi’s head count, which totaled 200,000 in December excluding the staff employed by a Mexico business that is being spun off. Citi detailed its cost-cutting plans on Friday, when it also announced a fourth-quarter loss.
The bank reported a huge earnings loss of $1.16 per share for the fourth quarter, far below estimates of a loss of 11 cents per share, according to FactSet.
Citi said there were several one-time costs that impacted its results. These included a $1.7 billion charge the bank had to pay related to the regional banking crisis last spring, an $880 million loss in Argentina and $800 million in restructuring costs associated with about 7000 layoffs in 2023.
These layoffs are part of Citi CEO Jane Fraser’s years-long effort to cut red tape at the company and boost lagging profits. Fraser called the results “very disappointing” on a call Friday morning, but said that 2024 would be a “turning point year” for the country’s third largest lender.
In addition to the 20,000 job cuts at the company’s operations, the bank said it will shed 40,000 employees from its Mexican retail unit through an IPO, bringing the total headcount for the company to around 180,000 from 240,000.
Over the next few years, the bank said it expects to pay up to $1 billion in severance pay and reorganization costs related to its planned restructuring.
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