Citigroup posts $1.8 billion fourth-quarter loss after litany of charges
CNBCDec 31, 2023
Citigroup Announces Job Cuts, Worst Q4 Loss in Years
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The Facts
Citigroup detailed in its latest quarterly earning report on Friday that thousands of job positions will be slashed over the medium term as part of an ongoing corporate reorganization, ultimately trimming its expenses by up to $2.5B.
The third-biggest US lender plans to reduce its workforce by about 8% over the next two years, laying off 20K employees globally in addition to 40K jobs that will be shed from its Mexican retail unit through an initial public offering.
The Spin
Narrative A
Given these results, 2024 will be a decisive year for Citigroup investors. While the company claims that its ongoing restructuring will improve profitability and returns, it has yet to be seen whether that will actually happen in the short run. Additionally, there's a long way to go on efficiency metrics, such as return on tangible common equity.
Narrative B
Though apparently disappointing, fourth-quarter earning reports from the largest banks in America reveal their resilience in the face of one-off charges that melted their income. Even Citigroup, which reported its worst quarter in more than a decade and announced plans for job cuts, performed well during the last quarter of 2023.