Citigroup Prepares for Another Round of Layoffs in March 2024
According to a Reuters report, Citigroup is expected to announce a fresh wave of layoffs in March this year. This development comes shortly after the American banking giant implemented approximately 1,000 job cuts in January 2024. The upcoming staff reductions are anticipated to occur after the bank completes its bonus payments, although specific details regarding the scale or geographical focus of these plans remain undisclosed.
Strategic Restructuring Under CEO Jane Fraser
This latest move is part of CEO Jane Fraser's comprehensive turnaround strategy, which aims to streamline operations, address regulatory challenges, and enhance profitability to help Citigroup compete more effectively with its rivals. Fraser, who assumed the CEO role in 2021, has been actively working on this transformation plan since her appointment.
In a significant recognition of her efforts, Fraser received a one-time $25 million equity award for progress on the turnaround plan and was elected as chair of the board in October 2023. The restructuring initiatives include both the recent layoffs and another organizational reorganization announced in November.
Who Will Be Affected by the March Layoffs?
The March job cuts are likely to primarily impact managing directors and senior employees across various divisions of the bank, according to sources familiar with the matter. Some senior managers have reportedly been transferred to other departments to preserve their roles before the staff reductions commence.
The January layoffs also affected several senior employees, indicating a pattern of targeting higher-level positions as part of the bank's cost-cutting measures.
Citigroup's Ongoing Workforce Reduction Strategy
Citigroup has been transparent about its intention to continue reducing staff numbers. In a statement earlier this month, the bank confirmed it would maintain its headcount reduction efforts through 2026. The company explained that these adjustments are necessary to align staffing levels, locations, and expertise with current business requirements, leverage technological efficiencies, and advance its Transformation initiative, which is approaching its target state.
Chief Financial Officer Mark Mason provided further insight during the January 14 earnings call, revealing that Citigroup's workforce decreased from 240,000 employees in 2022 to 226,000 by the end of 2023. Mason emphasized the bank's commitment to reducing headcount, noting an $800 million expense related to severance payments last year.
Regulatory Developments and Discreet Implementation
The layoffs coincide with some regulatory relief for Citigroup. The US Federal Reserve has closed notices requiring the bank to address weaknesses in its trading risk management, while the Office of the Comptroller of the Currency has rolled back a 2024 amendment to a 2020 consent order.
Unlike the publicly announced major layoffs in 2023 and 2024, which involved reducing management layers and selling assets, the current round of headcount reductions is being implemented more discreetly, according to the Reuters report.
This strategic approach reflects Citigroup's broader effort to optimize its operations while navigating regulatory landscapes and enhancing competitive positioning in the global financial sector.
