Don't Cut There!
Citigroup has announced plans to cut thousands of jobs and outsource them to India. But guess who is immune? The managing directors.
Under pressure from shareholders, Citigroup is planning to shed thousands of jobs and sharpen its focus on its operations outside North America.
The colossal bank will get most of its growth from its international operations, chief executive Charles O. Prince told thousands of employees in India today, as he wrapped up a tour of Asia.
Mr. Prince's stop in India comes just weeks before Citigroup will announce a broad restructuring plan that could involve the elimination or relocation of as many as 15,000 high-cost jobs from areas including New York, London and Hong Kong, several executives briefed on the matter say. The net job loss could be 10,000 to 12,000, some through attrition.
Citi's consumer operations will be hardest hit, with front line and back office operations affected, they say. The corporate and investment banking businesses may be hard hit, with several thousand jobs lost, they say.
Managers in these units have been asked to review highly paid employees and look for places to cut fat, particularly just below managing director level.
Perhaps this means that the executive suite is next on the chopping block, but one ought not hold one's breath.
By the way, the article indicated that Citigroup planned to save $1 billion with the forthcoming cuts. In 2006, five employees of Citigroup—Charles Prince, Sallie Krawcheck, Robert Rubin, Robert Druckin, and Stephen Volk—took in $78.768 million in cash, stock, options, pension benefits, and use of company aircraft. Surely there are 5 worthy Indian executives who would settle for $1 million in compensation apiece. Voiláa! The shareholders could have their value and save hundreds of jobs at the same time. But how many shareholders will actually read the proxy statement, which is "incorporated by reference" into the annual report? Probably dozens.
Labels: Citigroup, greedheads, outsourcing
