Citigroup (C.N), one of the world’s leading financial institutions, is reportedly considering job cuts of at least 10% in several of its major business units, CNBC reported, according to sources familiar with the matter. The news comes as the bank continues its extensive reorganization efforts under the leadership of CEO Jane Fraser.
Citigroup had previously announced its intention to implement job cuts as part of its sweeping reorganization, which was unveiled in September. However, the exact scale of these layoffs and the anticipated cost savings had not been specified until now. The internal codename for this ambitious restructuring endeavour is “Project Bora Bora,” as reported by CNBC.
The primary goal of this restructuring initiative is to grant CEO Jane Fraser more direct control over the bank while simplifying its operations and enhancing the institution’s stock price performance. Although the discussions surrounding potential job cuts are still in their early stages, the number of employees affected may undergo alterations as the process evolves. To facilitate this transformation, Citigroup has enlisted the expertise of Boston Consulting Group.
What exactly is changing?
Notably, Fraser’s strategy involves eliminating regional managers, co-heads, and other positions with overlapping responsibilities. This move is expected to result in job cuts exceeding the initial 10% estimate, particularly for executive-level employees. Last month, Citigroup disclosed its plan to reduce the number of management layers from 13 to eight. Within the two highest leadership tiers, the bank has already cut 15% of functional roles and eliminated 60 committees.
At present, Citigroup’s global headcount stands at approximately 240,000 employees, according to its most recent quarterly supplement released last month.
In response to these developments, a spokesperson for the bank issued a statement: “As we’ve said previously, we are committed to delivering the full potential of the bank and meeting our commitments to our stakeholders. We’ve acknowledged the actions we’re taking to reorganize the firm involve some difficult, consequential decisions, but they’re the right steps to align our structure to our strategy and deliver the plan we shared at our 2022 Investor Day.”
Jane Fraser, who assumed the CEO role in 2021, has been diligently working to enhance profitability, streamline operations, and address regulatory issues at Citigroup. Despite these efforts, the bank’s stock performance has continued to lag behind its peers in the financial industry.
The reorganization, often described as a critical step in Citigroup’s journey towards improved efficiency and competitiveness, will likely have significant ramifications for the bank’s employees and its overall standing in the market. The discussions surrounding job cuts and the specific details of the restructuring plan remain confidential and subject to change. Citigroup’s commitment to its shareholders and the pursuit of its 2022 Investor Day goals are at the forefront of the reorganization efforts. The exact scope and impact of the job cuts will become more apparent as the reorganization progresses, and stakeholders will be closely watching for updates and developments on “Project Bora Bora.”
As Citigroup continues to navigate this transformative phase under the guidance of CEO Jane Fraser, the banking industry and financial markets will undoubtedly be closely monitoring its progress and the impact on its workforce and investors.