After cutting 5,000 jobs last year, Citigroup plans to increase annual expense reductions to between $2.5 billion and $3 billion this year, executives said while reporting earnings for the year and fourth quarter.
The firm said its number of employees fell to 266,000 in the fourth quarter from 267,000 in the third quarter. While that's up 2% from the 260,000 employees Citigroup had at the end of 2010, many layoffs have yet to be subtracted from official tallies. The firm eliminated 5,000 positions late last year, Chief Executive Vikram Pandit said on the earnings call.
The layoffs are part of a cost-cutting initiative that had initially aimed to save $2 billion annually. Chief Financial Officer John Gerspach said the firm will reduce expenses by $2.5 billion to $3 billion in 2012.
"We will continue to rightsize our businesses, particularly in securities and banking," Pandit said. A quarter of the 5,000 job eliminations took place in capital markets. Gerspach said the firm wouldn't rule out more layoffs in that division.
"We remain very focused on expenses and ensuring our capacity is aligned with opportunities we see," he said.
The firm plans to continuing growing its consumer banking businesses, Pandit said. The bank plans to open more branches around the world, particularly in emerging markets.
In contrast, some "tweaking" is required in the securities and banking business, which has been impacted by regulation and market uncertainty, Pandit said. Foreign exchange and trading businesses, for example, will require less investment and fewer resources.
Compensation per person was roughly flat from the year prior, with employees receiving on average $239,849 per person in 2011.
Citigroup reported fourth quarter earnings fell to $1.2 billion or $0.38 a share, compared to $1.3 billion or $0.43 a share in the year earlier period. Full-year net earnings rose 6% to $11.3 billion from $10.6 billion in 2010.
Write to Julie Steinberg at Julie.Steinberg@dowjones.com