(CNN) — Citigroup will lay off 20,000 employees over the next two years, Chief Financial Officer Mark Mason reported Friday. The cut comes after the company reported a net loss of $1.8 billion in the fourth quarter of 2023, its worst quarter in 15 years.
The bank expects staff reductions to save it $2.5 billion over the long term.
The bank reported a massive fourth-quarter earnings loss of $1.16 per share, below estimates for a loss of 11 cents per share, according to FactSet.
The city said it had several one-time costs that affected its results. Among them, a $1.7 billion charge related to last spring’s regional banking crisis, an $880 million loss in Argentina and about $800 million in restructuring costs associated with about 7,000 layoffs in 2023.
The layoffs are part of Citi CEO Jane Fraser’s long-running efforts to cut the company’s bureaucracy and boost trailing profits. Fraser called the results “very disappointing” in a phone call Friday morning, but said 2024 will be a “decisive year” for the third-largest U.S. lender.
“Anytime an industry or a company goes through a downturn like this it’s tough on morale,” Manson said on a call with reporters Friday. “That said, I want to point to the fact that we are very clear about the strategy of the company and very clear about the momentum that we expect.”
In addition to the 20,000 job cuts at the company’s operations, the bank said it would lay off 40,000 employees from its Mexican retail unit through an initial public offering (IPO), reducing the company’s total workforce from 240,000 workers to about 180,000.
In the coming years, the bank said it expects to pay up to $1 billion in severance pay and restructuring costs related to its planned restructuring.
A City spokeswoman said the layoffs would be global in scope but declined to break down the number by region.
CEO Jane Fraser first announced her sweeping restructuring efforts last September. His plans to reorganize the bank’s leadership, increase accountability and boost share prices, he said, would require staff cuts.
“We will be saying goodbye to some very talented and hard-working colleagues,” Fraser wrote at the time.
Citi shares were down 1.2% in afternoon trading.
