Citi insiders are still arguing that all the wrong people were cut
At the end of this quarter, it will be a year since Citi declared that it had finished extracting deadweight from its managerial classes. 7,000 jobs were cut as part of project Bora Bora, 2,000 more than initially intended. When it announced the cuts, which involved stripping out five layers of management, Citi was insistent that they wouldn't impact revenues. Nine months later, some people are not so sure.
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"So many people were let go, so much experience and knowledge," says one former employee. "They basically flooded the market, and a lot of those people were significant revenue earners."
In FX sales and trading alone, the cuts included the likes of Scott Silver, Citi's global head of FX real money sales, Janice Martin, its head of New York corporate sales, Paul Bakunowicz the head of local markets FX trading for EMEA, Serge Pomonti, the head of institutional sales for Asia, and Anita De, a top saleswoman in London who'd been with the bank since 2007 according to the FCA Register.
Elsewhere in markets, Citi cut Marc Pagano, the head of emerging markets credit trading, Adrian Lui, head of spread products trading for Asia Pacific and Dirk Keijer, the head of equities trading for Europe.
"Anyone aged over 45 seemed to be at risk," says another insider. "There were a lot of heads of desks who were cut. These people were not only running teams, but had their own books and clients too."
In investment banking, Citi has restructured under ex-JPMorgan bankers Vis Raghavan and Achintya Mangla and has moved London banker Jens Welter to the US to run North American coverage. Late last year it cut Colm Rainey head of corporate and financial institutions group debt capital markets for UK & Ireland and others in what were described as "bonkers" firings by some.
The disappearance of revenue earners matters because Citi's intention was to cut to grow. The Financial Times reported yesterday that analysts have doubts about the bank's ability to meet its target of 11-12% returns by 2026 and that this could have implications for CEO Jane Fraser, who has pinned her flag to that mast.
In the first nine months of last year, Citi generated a return on average common equity of 6.4%, down from 7.3% in 2023. "It's a shocking figure," says one former MD there. "It would be fine if the whole industry were still struggling, but it's not."
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