Citigroup to dismiss 1,200 more

Previously this year, it fired 3,600 bankers

October 26, 2002|By BLOOMBERG NEWS

NEW YORK, - Citigroup Inc. will fire more than 1,200 of the 60,000 employees in its investment and corporate banking units to help counter a slump in revenue from merger advice, stock sales and securities trading, company executives said yesterday.

For the past month, top managers at Citigroup's Salomon Smith Barney division have been lengthening their lists of people to be dismissed on orders from Salomon Chairman Charles O. Prince III to cut more expenses, they said.

The expected cuts - which will follow the dismissal of 3,600 bankers this year - helped boost the bank's shares 3 percent, or $1.03, to $35.70 in New York Stock Exchange composite trading.

"They've got too many bodies and not enough deals," said Anton Schutz, who manages $60 million, including 25,000 Citigroup shares, at the Burnham Financial Services Fund.

"Why should you have guys sitting around playing solitaire?"

The world's largest financial-services company has fired 8 percent of its bankers this year and cut 2,000 investment banking jobs last year, according to Citigroup executives.

It is not alone. Since securities industry employment peaked 18 months ago, Wall Street firms have cut 61,000 jobs, according to the U.S. Bureau of Labor Statistics.

The Citigroup cuts will include more than 200 investment bankers who are to be fired over the next few weeks, including several in the upper levels of seniority, according to the New York Times, which earlier reported dismissal plans.

Ten percent to 15 percent of specialists in mergers and corporate finance will be affected, the newspaper said.

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