Citigroup’s private bank will not be hit by the parent firm’s decision to cut more than 11,000 positions, as it targets $900 million of expense savings that it expects to benefit results for next year.
The US banking giant today unveiled “a series of repositioning actions that will further reduce expenses and improve efficiency across the company”.
Asked by this publication about the cuts, a spokesperson said there will be no impact on the private bank.
As a result of the cuts, Citi said it expects to log pre-tax charges of around $1 billion in the fourth quarter of 2012 and around $100 million of related charges in the first half of next year. The bank also expects the actions to have a negative impact of under $300 million on annual revenues.
The cuts will affect the institutional clients group (around 1,900 positions), the global consumer banking segment (6,200 positions), Citi Holdings (350 positions), corporate/other; operations and technology (2,300 positions), and global functions (around 300 job cuts).
In global consumer banking, Citi will focus on the 150 cities with the highest growth potential. Markets affected by the reductions include: Brazil, Hong Kong, Hungary, Korea and the US. Meanwhile, the bank expects to sell or “significantly scale back” consumer operations in Pakistan, Paraguay, Romania, Turkey and Uruguay.
In the third quarter, Citi said private banking revenues increased by 8 per cent to $590 million from the prior year period, driven primarily by North America lending and deposits.