Citigroup CEO Jane Fraser announced a corporate reorganization Wednesday, saying the move would cut down management layers and accelerate decisions.
Fraser said in a release that Citigroup would be divided into five main business lines that report directly to her. Previously, the firm had two main divisions catering to consumers and large institutional clients.
The changes will include job cuts, though the New York-based company hasn’t decided on a number yet, according to people with knowledge of the matter.
Fraser, closing in on her third full year atop Citigroup, is seeking to revitalize a firm mired in a persistent stock slump. While Citigroup is the third-biggest U.S. bank by assets after JPMorgan Chase and Bank of America, it has a far smaller domestic retail banking presence than its competitors. That helps explain why Citigroup has struggled in the post-2008 financial crisis era.
“These changes eliminate unnecessary complexity across the bank, increase accountability for delivering excellent client service and strengthen our ability to benefit from the natural linkages that exist amongst our businesses, all with an eye toward delivering on our medium-term targets,” Fraser said.
Citigroup’s previous structure resulted in tensions between managers and a lack of accountability that sometimes thwarted new initiatives, according to current and former employees. The corporate setup dates back two decades to when Sandy Weill ran Citigroup, according to Wells Fargo analyst Mike Mayo.
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