NEW YORK—Embattled financial giant Citigroup Inc. announced plans to slash more than 52,000 jobs by early next year as the now No. 2 U.S. bank struggles to emerge from the credit crisis that has gripped the financial sector.
The jobs to be cut are in addition to the 23,000 jobs already cut this year, bringing the total up to 75,000, which is 20% of its staff. The layoffs are by far the largest announced by any of the firms hit by the global economic crisis.
Citigroup Inc. has reported quarterly losses for four straight quarters and has lost more than $20 billion in this last year. Analysts do not expect the financial giant to announce any profits before 2010.
The job cuts will affect Citigroup’s offices around the world, the bank said, adding that it would span many business units, including its retail and investment units. While half of the jobs lost will be done through layoffs, the remaining half would be through the sell-off of business units.
CEO Vikram Pandit made the announcements on Monday. Pandit took over at the helm of Citigroup from former CEO Charles Prince last December, just as the economic crisis was just beginning to weigh in.
Citigroup says the job cuts will enable it to cut expenses by 20%, down to an estimated $50 billion in 2009. It will bring its number of employees down to 300,000, the same number it had in 2005.
But Citigroup also sounded a positive note. “Underlying business remains strong and revenues have been stable,” it announced.
Citigroup is one of the nine financial institutions receiving assistance from the U.S. Treasury’s bail-out fund. Last month, the Treasury announced that it would inject cash into major U.S. financial institutions, including Citigroup, JPMorgan Chase, Goldman Sachs and Bank of America, with a total of $125 billion.
The jobs to be cut are in addition to the 23,000 jobs already cut this year, bringing the total up to 75,000, which is 20% of its staff. The layoffs are by far the largest announced by any of the firms hit by the global economic crisis.
Citigroup Inc. has reported quarterly losses for four straight quarters and has lost more than $20 billion in this last year. Analysts do not expect the financial giant to announce any profits before 2010.
The job cuts will affect Citigroup’s offices around the world, the bank said, adding that it would span many business units, including its retail and investment units. While half of the jobs lost will be done through layoffs, the remaining half would be through the sell-off of business units.
CEO Vikram Pandit made the announcements on Monday. Pandit took over at the helm of Citigroup from former CEO Charles Prince last December, just as the economic crisis was just beginning to weigh in.
Citigroup says the job cuts will enable it to cut expenses by 20%, down to an estimated $50 billion in 2009. It will bring its number of employees down to 300,000, the same number it had in 2005.
But Citigroup also sounded a positive note. “Underlying business remains strong and revenues have been stable,” it announced.
Citigroup is one of the nine financial institutions receiving assistance from the U.S. Treasury’s bail-out fund. Last month, the Treasury announced that it would inject cash into major U.S. financial institutions, including Citigroup, JPMorgan Chase, Goldman Sachs and Bank of America, with a total of $125 billion.
