Citigroup Inc. is expected to incur expenses of up to $400 million in the second quarter due to severance costs associated with 1,600 job cuts, according to Chief Financial Officer Mark Mason.
Speaking at a conference in New York, Mason revealed that the bank’s expenses in Q2 will be significantly higher than Q1, largely due to restructuring and repositioning charges.
The bank has already incurred costs related to a 5,000 headcount reduction across the firm since the start of the year, mostly in banking, markets, and functions.
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The bank has exited seven of the 14 markets it plans to divest from and has decided to spin off its Mexican unit next year and list it in 2025 after talks to sell it failed.
Mason also warned investors about a fall in revenues in investment banking and trading. He said that markets revenues fell 20% so far this quarter from a year earlier.
On investment banking, he expects revenues to be down 25% year over year. Goldman Sachs Group Inc. expects trading revenue may slump 25% this quarter, according to that bank’s president.
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Around 5,000 impacted staff have had severance set aside so far in 2023, according to Mason.
Citigroup will start to cut around 50 jobs within its London corporate and investment bank, it’s third round of reductions within the past six months.
Investment banks have been weighed down by a continuing slump in deals, which has prompted multiple rounds of job cuts since December.
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