Citigroup’s (NYSE:C) Corbat Claims Environment to Remain ‘Challenging’
Northern, WI 1/25/2013 (avauncer) - Citigroup Inc. (NYSE:C) CEO Michael Corbat claimed he anticipates the atmosphere for investment banking to be “challenging” and impact the compensation.
In an interview, Corbat said, “People recognize the times we are in, these are challenging times. Things will remain challenging going forward for a period of time. Our people recognize that.”
Corbat took over from Vikram Pandit as CEO at the in October. He has already declared plans to lay off around 11,000 employees as well as exit from specific markets in order to trim Citigroup’s (NYSE:C) costs and increase shareholder rewards. The company’s profits for its current businesses fell 8% previous year as the costs increased.
The firm trimmed bonuses of investment bankers by 10 to 20% worldwide after a decline in revenue. Corbat said it is possible for the company to remain totally competitive on the basis of banker pay. He said, “I think morale is good. Our employees are very confident around the strategy if you think about what’s going on in the world today.” But he refused to comment if the company intends to lay off more workers.
Corbat is undoing a portion of the expansion initiated by Pandit. The bank’s stock has increased 15% in trading in New York starting from Dec. 5, when Corbat declared the 11,000 lay offs and his intentions of lowering consumer operations in countries including Turkey and Pakistan. Corbat added, “In a challenging environment, you have got to be mindful of expenses and we are.”
Further Corbat told CNBC that Citigroup (NYSE:C) has constructed significant liquidity and will carry on building capital. He also stated that it’s essential to have a “level playing field” based on stringent capital rules globally.
The shares of Citigroup (NYSE:C) went up by 1.86% to close at around $43.00