Following its worst quarter in 14 years, Citigroup chief exec Jane Fraser has said that the bank plans to cut 20,000 jobs over the next two years.

The bank last week reported losses of $1.8 billion in the last quarter. Citi’s financial difficulties were compounded by $4 billion of charges and expenses which includes $800 million tied to restructuring and costs associated with exposure to Russia and Argentina.

Noting that the cuts could save as much as $2.5 billion by 2026, Fraser said that “While the fourth quarter was very disappointing due to the impact of notable items, we made substantial progress simplifying Citi and executing our strategy in 2023,” and described 2024 as “a turning point” for the company.

Since her appointment in March 2021, Fraser has overseen a radical shakeup at the US’s third-largest lender, including sweeping organisational reforms announced in September. This change saw the heads of Citi’s five interconnected businesses – wealth, services, markets, US personal banking, and banking & international – begin to report directly to Fraser and become members of the executive management team, with five layers of management being removed from its structure.

Citi previously said that it expects to complete its reorganisation by March, and has now said that the bulk of the 20,000 cuts will follow on from this. Once settled, Citi expects to have a headcount of around 180,000 by 2025 or 2026, significantly down from 240,000 at the start of 2023. A further 40,000 workers will be removed from the books as a result of planned exits from Citi’s consumer banking business in markets including Mexico.

Mark Mason, Citi’s chief financial officer, said: “Our simplification will be done by the end of the first quarter. That’s what will create the opportunity to help drive the headcount reduction.”

---