When Michael Corbat was handed the big boy seat at Citigroup, one thing became clear: cost cutting is the bank’s chief priority. Now we know why.
Citi generated just over $200,000 in revenue per employee through the first three quarters of 2012, down nearly 8% from the first nine months of 2011, according to Bloomberg. What’s worse: Citi’s closest competition is becoming more productive by the quarter.
Of the six largest banks – JPMorgan, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley – the average revenue per employee increased by 13% since 2005, with J.P. Morgan seeing a 19% jump. Citi, meanwhile, is on pace to be the only one of the six banks to see its full-year revenue per employee drop during that period.
Bloomberg estimates that Citi will need to cut roughly 35,000 jobs – or more than 13% of its workforce – to reach the productivity levels of a Wells Fargo or Bank of America.
Either Citi has a fairly significant redundancy problem or its employees are taking extra-long lunches.
More Cuts Looming (Bloomberg)
With net profit and wealth management margins dwindling, Credit Suisse has pledged to cut another $1 billion in costs by the end of 2015. This means layoffs.
Gupta Gets Two Years (Forbes)
Former Goldman Sachs director Rajat Gupta was sentenced to two years in prison and ordered to pay a $5 million fine for his participation in an insider trading scheme.
What’s the Holdup? (WSJ)
The Volcker Rule, originally scheduled to be implemented in July, appears nowhere near being completed, reportedly due to disagreements among regulators charged with crafting the new standards. Lawmaker frustration has begun boiling over.
Punch the Boss (eFinancialCareers)
Sharing a hobby with your boss – like chess, boxing or golf – is a great way to grow your professional relationship and establish trust. Just don’t fake your enthusiasm.
Baseless Claims (CNBC)
Former employee Greg Smith’s book did more good than damage for Goldman Sachs as it forced the firm to conduct an internal investigation into the claims, finding nothing to be out of order, says Goldman CEO Lloyd Blankfein.
Most who have read Greg Smith’s book agree: It contains very few earthshattering observations. In fact, the book sports one particular passage that is ripped off word-for-word from a Bloomberg article written more than a year ago.
Buzz Around the Office
How do you punish technology-addicted children? Hit ‘em where it hurts by posting embarrassing photos of yourself on their Facebook page.
List of the Day: HR Questions
Before accepting a job offer, be sure to inquire about more than salary, benefits and vacation time. Ask HR these questions as well.
- Do you reimburse for moving expenses?
- Do you offer employee education packages?
- What about work-life policies, like parental leave, flex time and telecommuting?
(Source: The Daily Muse)