Citigroup Inc., the third-biggest U.S. bank, plans to cut about 350 additional jobs this year from the securities division, which includes investment banking and trading, according to a person with knowledge of the matter.
The reduction equals about 2 percent of the unit's staff, according to the person, who asked for anonymity because the changes haven't been publicly announced. The bank previously disclosed plans to eliminate 1,200 jobs from the division.
Citigroup Chief Executive Officer Vikram Pandit is grappling with a revenue slump in trading and investment banking as the European sovereign-debt crisis roils markets and customers take fewer risks. New regulations are also crimping profit, with first-half net income at the division down more than 40 percent from two years earlier.
"We continue to make targeted headcount reductions in certain businesses as part of our ongoing efforts to control expenses in light of current market conditions," said Danielle Romero-Apsilos, a spokeswoman for the New York-based company, in an e-mailed statement.
Citigroup announced plans in January to cut 1,200 people to save $600 million this year at the securities and banking division. Chief Financial Officer John Gerspach warned that the bank would tighten again if revenue did not rebound in 2012, citing "disappointing" results in equities trading and investment banking.
Costs Versus Revenue
"We are not oblivious to the fact that our cost structure cannot be justified by our current revenue," Gerspach said. "While much of the current difficulty reflects market conditions, we equally have some management and execution challenges."
Jamie Forese is head of the securities and banking division. He oversees Citigroup's trading boss, Francisco "Paco" Ybarra, and the heads of investment banking, Raymond J. McGuire and Tyler Dickson.
Revenue from investment banking, which includes advising on mergers and acquisitions and underwriting stock and bond sales, fell 11 percent to $1.72 billion for the first six months of 2012 from a year earlier. Equities trading, run from London by Derek Bandeen, slid 35 percent to $1.22 billion. Fixed-income trading dropped 3 percent to $6.61 billion before accounting adjustments.
The job cuts were reported earlier today by the Wall Street Journal.