Citicorp's broad-ranging reorganization launched earlier this year is aimed at improving efficiencies and freeing up resources, said Citicorp vice chairman Christopher J. Steffen.
Speaking at a seminar on Tuesday sponsored by Loan Pricing Corp. and Financial World magazine, Mr. Steffen emphasized that the "reengineering" is more a matter of improving operations than of radically altering Citicorp's focus.
"Our business direction is to be a global service bank, an emerging market bank, and a U.S. consumer bank," Mr. Steffen said. Basically, the reengineering "means taking a piece of paper and sitting down and figuring out how can this job be better done."
Citicorp has for several years been studying how large industrial corporations have improved productivity and efficiencies in an effort to see what systems might be used by the bank.
Mr. Steffen, who previously worked for the Eastman Kodak, Honeywell, and Chrysler, was hired two years ago as a senior executive vice president. He was named vice chairman earlier this year.
"Reengineering has become something of an unfortunate word because it has come to symbolize reductions in staff," he said.
But Citicorp's current reorganization will also include "eliminating unnecessary layers of management," Mr. Steffen admitted.
He emphasized that the bank will remain an active player in the capital markets despite chairman John Reed's earlier statements ruling out any major move into the investment banking arena. "On the issuer side, that means developing first-rate products" and being the best provider of investment opportunities in the market, he said. He also suggested that Citicorp might look to outsource some of its operations and modify a large number of employee responsibilities, while reducing management.
The banker added that the Citicorp revamping, the largest in over a decade, is mainly a result of changes in the marketplace and in the cost of capital.
"We are definitely experiencing one of the most dynamic periods in the history of banking," Mr. Steffen observed. "We're looking at our whole business and that entails a reevaluation of how we do our business."