Citigroup May Report Restructuring Plans ahead of Q1 Earnings -- WSJ

The Wall Street Journal reports people familiar with a restructuring plan at Citigroup say cost cutting plans could include 15,000 jobs, or about 5% of its global work force and a $1 billion charge. Citi is expected to make an announcement ahead of its Q1 earnings release scheduled April 16, which is followed by its annual meeting on the 17th. The Journal points out the plan isn't final, and notes a source says one option for reducing headcount is to not replace some of the 30,000 - 50,000 employees that leave Citi annually. One of CEO Charles Prince's biggest problems is spending is exceeding revenue growth. Last year operating expenses increased 15% to $52b, while revenues rose only 7%. Citi's COO Robert Druskin, a close friend and longtime colleague of Prince's, is leading the restructuring planning and is said to have 150-200 areas under review. The Journal mentions Citi is considering whether to make a bid for ABN Amro in the ballpark of $80b, but suggests Prince will place a higher priority on the forthcoming restructuring plan.

Sources: The Wall Street Journal
Commentary: Citigroup Said to be Considering Rival Bid for ABN Amro • Nikko Cordial: 6.6% Shareholder Southeastern Says Citi Bid Too Low • HSBC, Citigroup, Get Key Approval for Chinese Banking
Stocks/ETFs to watch: Citigroup (C). Competitors: Bank of America (BAC), Deutsche Bank (DB), JP Morgan Chase (JPM). ETFs: iShares Dow Jones US Financial Services (IYG), Financial Select Sector SPDR (XLF), KBW Bank ETF (KBE)

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