GO
Loading...

Enter multiple symbols separated by commas

Citigroup Axes 11,000 Jobs, $1.1 Billion in Costs

Michael Corbat, CEO of Citigroup
Getty Images
Michael Corbat, CEO of Citigroup

Citigroup plans to slash 11,000 jobs and close branches worldwide as part of a broad restructuring effort it hopes will save about $1.1 billion in expenses, the bank announced on Wednesday.

The moves, which the company said will result in a pre-tax charge of $1 billion against its fourth quarter earnings, comes as the mega bank tries to address structural problems that have resulted in a loss of confidence among investors, and precipitated the abrupt departure of former CEO Vikram Pandit in October.

The bulk of the layoffs, some 6,200 positions, are expected to come from global consumer banking -- an area in which the bank had recently invested money as part of an effort to create new efficiencies. (Read more: Inside Citigroup's Strategy to Become Global Consumer Bank .)

Citigroup said it expects about $900 million in cost savings next year, and annual expense savings of more than $1.1 billion beginning in 2014. It also expects to take $100 million of related charges in the first half of 2013.

"These actions are logical next steps in Citi's transformation.While we are committed to — and our strategy continues to leverage — our unparalleled global network and footprint, we have identified areas and products where our scale does not provide for meaningful returns," Michael Corbat, Citi's chief executive officer, said in a statement.

"And we will further increase our operating efficiency by reducing excess capacity and expenses, whether they center on technology, real estate or simplifying our operations," he added.

Corbat -- a veteran of the bank's investment and commercial banking operations -- assumed the reins of the troubled mega bank in October.Analysts have widely expected him to begin shaking up operations at Citi, which continues to suffer from an overhang of troubles that are in part a legacy of the 2008 financial crisis.

Symbol
Name
Price
 
Change
%Change
Volume
C
---

After nearly collapsing during the financial meltdown, Citi has come under withering pressure from investors and critics. This summer,former CEO Sandy Weill called for an end to the financial supermarket concept he helped to pioneer while at Citi. Last month, a group of minority shareholders called for the bank to consider a more dramatic revamp, or an outright break up. (Read more: Wall Street Legend Sandy Weill: Break Up the Big Banks .)

Investors reacted to the news by bidding up Citi's shares. The company's stock surged by nearly five percent in late morning dealings on the New York Stock Exchange.

--Terri Cullen contributed to this report.

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Lottery ticket

    A thief who broke into the car of a Seattle couple left behind a million-dollar lottery ticket, NBC News reports.

  • The Lamborghini SpA Urus SUV.

    There's no shortage of luxury vehicle choices, but increasingly the wealthy are opting for high-end SUVs instead of traditional models.

  • Mike Trout #27 of the Los Angeles Angels takes a picture with fans before a game with Boston Red Sox at Fenway Park on May 23, 2015 in Boston, Massachusetts.

    MLB is using digital media initiatives like Snapchat and Web video to connect with younger viewers. Is it enough?

U.S. Video

  • Cramer: Here's the no. 1 play in cybersecurity

    Guarding Your Portfolio? "Mad Money" host Jim Cramer's got the number one pick for protection services in today's digital world.

  • Underestimate Cisco at own peril: Cramer

    Mad Money's Jim Cramer takes a look at the cybersecurity space to see if it could also protect your money.

  • Fly with LUV?

    While remaining profitable, Gary Kelly, Southwest Airlines chairman and CEO, tells Mad Money's Jim Cramer the company continues to focus on being a great airline and offering great customer service.