Citigroup, one of the largest banks in the world, has announced its plans to cut a staggering 20,000 jobs by the end of 2026. This move comes as part of the company’s restructuring efforts, aimed at streamlining its operations and improving profitability. CEO Jane Fraser believes that 2024 will be a “turning point” for the company.
However, the news of job cuts has not been received well internally. CFO Mark Mason admits that these cuts are tough on morale. Currently, Citigroup has a workforce of 239,000 employees worldwide, but it intends to reduce this number to around 180,000. Furthermore, the upcoming listing of Banamex, Citi’s Mexican consumer division, will lead to an additional reduction in staffing levels by approximately 40,000.
In its latest financial report, Citigroup posted a loss of $1.8 billion for the fourth quarter. This loss was primarily due to charges and expenses related to restructuring, the decision to retreat from Russia, and exposure to Argentina. Surprisingly, despite this setback, shares in Citigroup actually rose by 0.4% during early trading in New York.
Meanwhile, JPMorgan Chase, America’s third-largest bank, has reported its best-ever annual profit. Despite a 15% drop in profits during the fourth quarter, the bank’s earnings for the year surged by an impressive 32% to $49.6 billion. JPMorgan benefitted from higher interest rates and its acquisition of First Republic.
Looking ahead, JPMorgan projects net interest income to reach $90 billion this year. However, CEO Jamie Dimon remains cautious, noting potential downside risks in the economy.
Focusing on market performance, shares in JPMorgan rose by 0.6% on Friday, indicating investor confidence in the bank’s future prospects.
In conclusion, Citigroup’s plans to cut a significant number of jobs and JPMorgan’s record-breaking annual profit reflect the ongoing changes and challenges in the banking industry. While Citigroup’s restructuring efforts may have a short-term negative impact, the market remains optimistic about its long-term potential. JPMorgan, on the other hand, continues to thrive, capitalizing on favorable market conditions and strategic acquisitions.
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