MercoPress. South Atlantic News Agency

Citigroup prepares for long winter sheds 20% jobs worldwide

Banking giant Citigroup announced it is planning shed 52,000 jobs with losses falling “particularly heavily” in London and New York. The cut - along with previously announced job losses of around 22,000 - will leave it with a global total of 300,000 employees in the near term.

Citigroup employs around 12,000 people in its UK businesses, the majority in London and Derby, where its online bank Egg is based. Worldwide job losses will amount to approximately 20% of its work force. Some of the job losses could be achieved through natural staff turnover. The company has posted four straight quarterly losses, including a loss of 2.8 billion US dollars during the third quarter this year. The group is not expected to return to profit until 2010. Speaking at a business forum in Dubai, United Arab Emirates, Citigroup chairman Win Bischoff said it would be irresponsible for Citi and other companies not to look at staffing in the event of a prolonged economic downturn. "What all of us have done - and perhaps injudiciously - we've added a lot of people over... this very benign period," he said. "If there is a reversion to the mean... those job losses will obviously fall particularly heavily on the financial sector," he added. "Certainly they will fall particularly heavily on London and New York." Mr Bischoff did not rule out the likelihood that Citi's leaders would go without bonuses this year - a move that would effectively amount to a substantial pay cut for the company's executives. The plans were due to be discussed with employees by chief executive Vikram Pandit at the company's town hall meeting in New York Citigroup, one of the largest US banks, is one of nine financial institutions benefiting from the US government's bail-out programme. The Treasury announced last month that it would be providing cash injections worth 125 billion US dollars to be shared between Citigroup, JP Morgan Chase, Bank of America, Goldman Sachs, Morgan Stanley, Wells Fargo, Bank of New York Mellon, State Street and Merrill Lynch. Last week, Citigroup stock fell into the single digits for the first time since Sanford "Sandy" Weill created the bank in 1998 from the merger of Travelers Group Inc and Citicorp. Citigroup said it has a "very strong" capital position, but on Friday the bank's stock was down 68% this year, leaving the group with a market value of 51.9 billion USD. That's barely twice the 25 billion of capital it received from the U.S. Treasury Department's bank bailout plan, and down from more than 270 billion USD in late 2006.