CITIGROUP is considering further cuts to its securities and banking division, raising the prospect of more redundancies at its London offices.
The bank’s finance chief John Gerspach told investors that losses in the division were “disappointing and unacceptable” and that the firm is “not oblivious to the fact that our cost structure cannot be justified by our current revenues”.
Gerspach also revealed that the division’s bonus pool had been reduced by $800m (£514m) in 2011.
“We must either drive revenue growth and operating leverage or we will have to restructure, cut capacity and cut expenses,” he said in a conference call. “While this is not a decision that we will make in haste, it is also not a decision that we will delay in the name of long-term strategy,”
The firm spent $1bn during 2011 on rebuilding the unit – which includes investment banking, private equity and hedge fund operations – but has been disappointed by its performance.
Citi employs around 10,000 staff in London within a global workforce of 266,000. The firm is currently in the process of laying off 5,000 employees worldwide, including several hundred in the UK.
The bank could not confirm how potential redundancies would affect specific regions but it is almost certain that London would be affected.