Citi Cutting Jobs, Spending Money

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Citigroup’s Chuck Prince was apparently disappointed by the market’s reaction to the announcement that Citi was eliminating 15,000 jobs. Now he’s throwing another 11,000 jobs onto the funeral pyre, according to published reports.
When Citigroup went public with the job cuts and other cost cutting measures, it was clear that they hoped the market would read this as a serious effort to improve Citi’s bottom line. But the stock price stubbornly refused to cooperate. This time around Citi is reportedly coming back with a plan to “eliminate or reassign” 26,000 jobs. Will this move the needle when it is announced tomorrow?
Perhaps not. According to a hedge fund trader we spoke with this morning, timing the additional job cuts announcements with news that Citi might spend $600 million to acquire one guy—former Morgan Stanley executive Vikram Pandit—and his year old hedge fund undermines the credibility of the bank when it comes to cost-cutting. Then again, the hedge fund trader we spoke with was admittedly jealous that no-one was offering him $600 million for his fund.
Citigroup’s Revamp May Trim Its Compliance Corps [New York Times]
Citigroup’s mulls U-turn on Old Lane [Financial Times]

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