Citigroup, once the largest bank in the world, held a town hall meeting for all Citigroup employees today. In the prepared presentation, Citi management shares details on the company’s health:
-Underlying business remains strong, and revenues have been stable
-Very strong capital position
-Strong competitive position to seize future opportunities
They conviniently left out the fact that there were no profits in the last year. In fact, the company lost $20 billion since the 4th Quarter 2007.
They then highlight a few key points essential to returning the company to prominence, after losing so much money, marketshare, and credibility.
-Headcount expected to be down 20% in the near-term from peak levels
-Significant reduction in risky assets
-Expenses expected to be down 20% from peak levels
Basically, what this means is that Citi is going to eliminate 53,000 more jobs, in order to reduce the “headcount” to 300,000. This comes on top of the 20,000 job cuts already underway. That is a 20% reduction in the bank’s workforce.
And as far as the significant reduction in assets, does that mean more write-offs in the future? And at what price are they going to write off these risky assets? Looks like trouble down the road. Read the full presentation, provided in conjunction with the meeting.