Citigroup, aiming to enhance its financial performance and stock value, has announced a workforce reduction of 10%. The decision comes as part of CEO Jane Fraser’s comprehensive restructuring initiative, internally dubbed “Project Bora Bora.”
The New York-based bank revealed on Friday, as part of its fourth-quarter earnings presentation, that approximately 20,000 employees will be laid off over the “medium term.” While the specific duration remains unclear, Citigroup has previously used this term to signify a three-to-five-year period. As of the end of 2023, the bank had around 200,000 employees, excluding Mexican operations currently undergoing a spin-off.
Jane Fraser initiated a substantial overhaul of Citigroup, the third-largest U.S. bank by assets, in September. The bank has been lagging behind its peers since the 2008 financial crisis, primarily due to challenges in controlling expenses.
Earlier reports in November, under the codename “Project Bora Bora,” indicated discussions among managers and consultants about a 10% reduction in the workforce across several major business divisions. Since then, Citigroup has initiated multiple rounds of layoffs, with another set for January 22, according to an undisclosed source.
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The bank revealed that it incurred a $780 million charge in the fourth quarter related to Fraser’s restructuring project. Additionally, it anticipates potential severance and other expenses totaling $1 billion in 2024. Citigroup believes these measures could result in a reduction of up to $2.5 billion in expenses over time.
In a presentation footnote, Citigroup mentioned that the actual number of job cuts might be “slightly lower” if the bank chooses to utilize internal resources instead of outsourcing certain functions.
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Amid the prospect of additional job cuts in the coming years, some Citigroup employees are reportedly utilizing vacation time or mental health leave to explore alternative employment opportunities, according to an anonymous source familiar with the matter.