Of course, the bank doesn’t call these layoffs or cuts, but refers to them as “repositioning actions” to “improve efficiency.”
But the release goes beyond that. It’s not just that the bank uses jargon, but that it talks about branch counts in key areas as being representative of optimism and growth.
Take this section for instance where the bank talks about these countries and cities as areas of growth potential yet is cutting thousands of positions there. (Emphasis ours)
Global Consumer Banking (GCB): Approximately 35% of the fourth quarter repositioning charges are expected to be incurred in Global Consumer Banking, resulting in a reduction of approximately 6,200 positions, of which approximately 40% are in the Operations & Technology functions that support the business. As a result of the repositioning actions, Citi expects to either sell or significantly scale back consumer operations in Pakistan, Paraguay, Romania, Turkey and Uruguay.
Consistent with Citi’s strategy of focusing on the 150 cities that have the highest growth potential in consumer banking, Citi will optimise its branch footprint and further concentrate its presence in major metropolitan areas. The markets affected by the reductions include Brazil (14 branches), Hong Kong (7), Hungary (4), Korea (15), and the United States (44).
Citi will continue to invest in its franchises in these countries to serve its targeted consumer segments. After this repositioning, Citi will have more than 4,000 retail branches around the world and all of the aforementioned countries will continue to be served by our institutional businesses.
Get that? In the cities that have the highest growth potential, it’s “focusing” by reducing branches.
That’s not all. Check out new CEO Michael Corbat’s statement in the release. (Again, emphasis ours):
“These actions are logical next steps in Citi’s transformation. While we are committed to– and our strategy continues to leverage– our unparalleled global network and footprint, we have identified areas and products where our scale does not provide for meaningful returns. And we will further increase our operating efficiency by reducing excess capacity and expenses, whether they centre on technology, real estate or simplifying our operations.”
The market seems to be reacting well, though. Shares of Citi were last trading up more than 3.8%.