NEW YORK: Citigroup in the second quarter will book severance costs associated with around 1,600 job cuts, Chief Financial Officer Mark Mason said on Wednesday (Jun 14).
Speaking at a conference in New York, Mason said the bank’s expenses in the second quarter will be US$300 million to US$400 million higher than the first quarter, “largely attributed to those restructuring or repositioning charges that I had to incur.”
Since the start of the year, the bank has incurred costs related to a 5,000 headcount reduction taking place across the firm, largely in banking, markets and functions.
One person with knowledge of the matter said the job cuts include people that worked in units Citi decided to divest, but did not specify the number. Although not all the people have left the firm, most were already notified, the person added, seeking anonymity to discuss the issue freely.
The bank has already exited seven of the 14 markets it plans to divest from. The bank decided to spin off its Mexican unit next year and list it in 2025 after talks to sell it failed.
Mason also warned investors about a fall in revenues in investment banking and trading.
He said markets revenues fell 20 per cent so far this quarter from a year earlier.
On investment banking, he expects revenues to be down 25 per cent year over year. “It’s been tough to call exactly when the wallet will rebound”, Mason said, adding there have been “green shoots” in debt capital markets activity.
Goldman Sachs Group expects trading revenue may slump 25 per cent this quarter, that bank’s president said last week.
Source: CNA
