Citigroup CEO Jane Fraser has announced plans for additional job cuts, emphasizing the need to eliminate outdated operational practices. The move follows earlier reductions and underscores a broader transformation aimed at improving efficiency and competitiveness.
- Citi plans 2,000–3,000 additional job cuts in 2026, following 5,000 reductions since 2024
- CEO Jane Fraser cites outdated practices as major impediments to efficiency
- Target: reduce cost-to-income ratio from 72% to below 65% by 2027
- Return on equity has remained under 10% for two years
- Dividend growth remains frozen since late 2023
- Stock declined 1.8% following announcement
Citigroup's leadership is preparing for another round of workforce reductions, with CEO Jane Fraser confirming that the bank is actively assessing its organizational structure to drive long-term performance. Fraser emphasized that the current phase of transformation extends beyond cost-cutting, targeting entrenched practices that hinder agility and innovation. She cited internal inefficiencies and legacy systems as key barriers to progress. The bank has already implemented approximately 5,000 job reductions since the start of 2024, representing roughly 8% of its global workforce. Fraser indicated that a new wave of adjustments could affect between 2,000 and 3,000 additional positions, with final decisions expected by the end of the first quarter of 2026. These layoffs are expected to focus on overlapping roles, non-core functions, and underperforming business units. The restructuring comes amid pressure to improve return on equity (ROE), which has remained below 10% for two consecutive years. Fraser highlighted that the bank’s cost-to-income ratio, currently at 72%, must be reduced to below 65% by 2027. Achieving this target is critical to restoring investor confidence and supporting dividend growth, which has been frozen since late 2023. Financial markets reacted cautiously to the announcement, with Citi's stock dipping 1.8% in early trading. Analysts noted that while the actions are likely necessary, further job cuts may heighten concerns about employee morale and customer service quality. The impact is expected to be most acute in the bank’s global markets and middle-office operations.