Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

Bank Giants Citi, BofA Keep Retrenching

Roy Harris | Sept. 15, 2011
Citigroup Inc. is announcing plans to limit hiring to "critical" jobs only, while Bank of America Corp. is taking a major divestment step in a retrenchment that also involves a plan to pare 30,000 positions.

Citi Chief Financial Officer John Gerspach told analysts in July that expenses for the year would be higher than previous forecasts. Expenses at the bank had risen 8%, to $25.3 billion, in the first half of 2011, compared with a year earlier, and revenue had fallen 15%, to $40.3 billion, including sales at the bank's Citi Holdings unit. The unit has about $300 billion of unwanted businesses and assets. Profit fell 11%, to $6.34 billion.

Sales at Citigroup's securities-and-banking unit, which includes trading and investment banking, fell 18%, to $11.5 billion. Regional consumer banking revenue stayed flat at $16.2 billion, and the bank's transaction-services unit increased revenue 6%, to $5.2 billion.

Citigroup previously had announced plans to add branches outside the U.S. and more than double staff in China to 12,000 as Pandit, 54, sought to boost the bank's presence in emerging markets. The company has also hired about 40 managing directors this year for its investment-banking unit.

"We've added talent in businesses and regions that are targeted for growth," Bell says.

But Pandit had eliminated more than 100,000 workers from the bank's payroll since becoming CEO in December 2007, through layoffs and sales of distressed assets and businesses in Citi Holdings, according to Bloomberg.

 

Previous Page  1  2 

Sign up for CIO Asia eNewsletters.