Tremors from the management shake-up at Citigroup Inc. were felt here Tuesday as 40% of its Washington office - including five lobbyists - was laid off.

Citigroup, formed by the controversial Oct. 8 merger of Citicorp and Travelers Group, laid off 12 of its 29 employees here as part of a cost- cutting plan, a company spokesman said. That included reducing to 10, from 15, its number of lobbyists, he said. Responsibility for the $700 billion- asset company's Washington office will be shared by Gregory J. Koczanski and Roger N. Levy, Citicorp's and Travelers' lead lobbyists, respectively.

Layoffs were split between former Citicorp and Travelers employees, the spokesman said. But sources said the five key professionals cut were former Citicorp employees: Peter J. Gray, Charles W. Turnbaugh, Gerald P. O'Driscoll Jr., John Hanley, and Margaret Simmons. The Citigroup spokesman would not confirm that these names were among the casualties but did not include them in the list of lobbyists who were retained.

The firings here came just two days after the surprise resignation of Citigroup president James Dimon, who had been the heir apparent to chairmen and chief executive officers Sanford I. Weill and John S. Reed.

Both Citicorp and Travelers were powerful lobbyists on Capitol Hill before the merger. After the proposed combination was announced in the spring, Citicorp abandoned its opposition to financial services reform legislation and allied with Travelers and others to push the bill farther than anyone expected it could get. The House approved the legislation by a single vote in May, but it stalled last month before the Senate could vote.

Travelers Group gave $1.6 million to federal candidates and political parties from Jan. 1, 1997, through June 30, 1998, ranking among the top 10 overall contributors nationwide, according to a recent study by the Center for Responsive Politics.

Citicorp was 21st among the top 50 corporate political action committees in terms of contributions to candidates for the same period, according to the Federal Election Commission.

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