Citigroup Inc, the biggest US bank by assets, banned off-site meetings among employees and cut back on colour photocopying to reduce expenses as investment- banking revenue declines.
Executives in the New York-based bank’s institutional clients group will need to ensure spending is ''highly efficient,’’ according to an internal memorandum confirmed by a Citigroup spokesman in London today.
Citigroup is clamping down on spending after cutting about 14,000 jobs in the first half of 2008 and reporting $55 billion of writedowns and credit losses, more than any other bank, according to data compiled by Bloomberg. Revenue at the company’s corporate and investment bank plunged 71 per cent in the second quarter because of losses on sub-prime-related assets.
“They are cyclical businesses that do get a bit fat in the good days,” said Antony Gifford, who oversees about $4 billion in North American equities at Henderson Global Investors in London. “It’s not material, but a worthwhile exercise for a company the size of Citigroup.”
Under the new policy, employee meetings must be held within Citigroup offices and client events will require approval, the memo said. Color photocopiers will be removed from some locations and their use will be limited to client presentations. The memo didn’t say how much money the new rules will save.
“We have spent considerable time looking at our headcount and related expense, and while we have made progress in that area, we still have more work to do,” the memo said.
Share Comparison:Citigroup has declined 40 per cent this year on the New York Stock Exchange, compared with 30 per cent at Charlotte, North Carolina-based Bank of America Corp. and 17 per cent at JPMorgan Chase & Co, based in New York. Citigroup rose 1 cent to $17.62 in composite trading at 9:34 a.m.
Financial firms globally have eliminated 101,250 jobs since the beginning of the credit crunch last year.
