Citigroup (C) CEO Vikram Pandit will have an employee meeting on Monday in the hope that he can calm concerns that the huge financial company is falling apart. With its stock below $10 there have been mounting rumors about whether the government might have to come in with a AIG-like bailout or to arrange a sales of the company to another one of the major banks.
While Pandit is thanking his people for all of their effort, it appears that Citi is looking at cutting 10% of its total workforce which would be about 35,000 people.
According to Reuters, "Citigroup Inc plans to shed about 10 percent of its global workforce,"
Even cuts of that magnitude may not be enough. Several bank analysts expect Citi to lose more money next year. The firm still holds derivatives which may well have to be written down as the housing and credit markets continue to drop. Citi also has a huge pool of consumer debts attached to loans and credit cards.
Citi may simply not be able to stay ahead of the curve.
Douglas A. McIntyre