(USA TODAY) - Citigroup, the third-biggest U.S. bank, said Wednesday that it plans to cut more than 11,000 jobs in an effort to reduce costs.
In a statement, New York-based Citi (C) says it will take a pretax charge of about $1.1 billion this quarter and expects savings in 2013 to be $900 million.
Citi shares were up 3.87% to $35.62 a share after the announcement.
"These actions are logical next steps in Citi's transformation," CEO Michael Corbat said in Citi's statement. "While we are committed to -- and our strategy continues to leverage -- our unparalleled global network and footprint, we have identified areas and products where our scale does not provide for meaningful returns.
The bank says about 1,900 jobs will be cut in its institutional clients group, an effort to "improve overall productivity in our markets business, especially in areas experiencing continued low profitability, such as cash equities.''
About 6,200 jobs will be eliminated from Citi's global consumer banking business, and another 2,600 jobs will disappear in the bank's operations and technology group and global functions.
The financial giant says its consumer unit will focus on "the 150 cities that have the highest-growth potential in consumer banking."
As a result, it expects to cut 44 branches in the United States, 15 in Korea, 14 in Brazil, seven in Hong Kong and four in Hungary. It also says it "expects to either sell or significantly scale back consumer operations in Pakistan, Paraguay, Romania, Turkey and Uruguay."
In mid-October, Vikram Pandit abruptly resigned as CEO, one day after the bank said its underlying third-quarter profits were strong and that the bank's outlook was improving. Corbat succeeded Pandit, who had been at the helm of the bank for five years, before and after the 2008 financial collapse. A second top executive also resigned that day.
In November, a regulatory filing disclosed that Citi paid Pandit a $6.7 million bonus and also paid a $6.8 million bonus to John Havens, the former chief operating officer who had resigned the same day Pandit did.