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Morning Coffee: Citigroup is on a mission to cut a lot of jobs this week. Top Barclays trader leaves after bonus complaints

It's Easter week for Christians and Ramadan for Muslims and Holi for Hindus, but Citigroup has less ethereal things on its collective mind. Having promised to finish the first stage of its 20,000 job cuts in the first quarter of 2024, it seems to be under a bit of pressure to finish them off. 

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Reuters reports that Cit is in the "last phase" of its initial 5,000 job cuts this week. These are the cuts that are removing layers of management and cutting the bank's hierarchy from 13 layers to eight. 

Citi has been working its way down through the hierarchy, extracting layers as it goes. This week's cuts are presumably, therefore, the lowest layer, and the pyramidal shape of a hierarchy dictates that they are also the largest. Reuters reports that Citi CEO Jane Fraser has sent a memo to this effect: job cuts are happening Monday to Thursday, before Good Friday, and they will be the biggest yet.  There will be cuts, but there will also be "reassignments."

Citi people who survive this week might be tempted to breathe a sigh of relief. However, this could be premature. This is just the end of phase one. Citi said in January that it plans to cut 5,000 jobs from the managerial delayering, 5,000 from selling businesses, and 10,000 from cutting headcount in support functions like technology and operations. The bulk of the cuts are therefore still to come. 

Having declared that it wouldn't cut revenue generating staff, Citi last week also showed signs of willingness to cut investment bankers without deals to work on and cut at least 20 people in the UK. 

It's not over yet. 

Separately, after Barclays allegedly didn't pay the best bonuses to some of its macro traders, Bloomberg reports that Carl Scott, its EMEA head of rates trading, has left. 

This was presumably not intended. Barclays plans to cut £188m in compensation costs for the investment bank before 2026, but Scott only joined from Citadel Securities in 2022. Barclays has also proclaimed European rates trading as an area of focus (along with securitization). 

The concern now might be that some of its other recent hires could also leave. Guy Winkworth and Hamza Hoummady, who head GBP rates and non-linear rates for Barclays, both reported to Scott and only joined in August 2023 and December 2022 respectively. Winkworth came from Deutsche Bank, which now has quite a few holes to fill of its own if he feels like going back there. 

Meanwhile... 

Winston Cheng, who built out HSBC's Hong Kong investment banking team is leaving for an unspecified job in a Fortune 500 company. (Bloomberg)  

The FCA hired an auditor on a £220k salary, but it appointed someone internally who didn't have an audit qualification and only advertised the role for five working days. (The Times) 

Bridgewater says the former executives accusing it of favoritism, age and sex discrimination are only doing it to make money. (Bloomberg) 

Ruffer investment chief Henry Maxey thinks multistrategy hedge funds will cause a financial crisis. "It is the reincarnation of Wall Street’s proprietary trading desks in asset management, with upside-down incentive structures, without the same regulatory oversight and with ill-fated stop loss risk management." (Alphaville)

Private credit managers are doing all the fossil fuel deals now. (Bloomberg) 

Sam Bankman Fried is being sentenced on Thursday. He could face 100 years in prison. (Guardian) 

Meta wants to hire AI people so much that it's making job offers without interviewing candidates and Mark Zuckerberg is sending personal emails to research at Google's DeepMind unit. (The Information) 

Employees are mentioning conditions such as autism and ADHD for the first time when they're put on some form of performance management plan or are facing dismissal. (Financial Times) 

Sometimes it makes sense to give up a $150k a year job to have time for more cooking, exercising and relaxing with your fiancé and dog. Sometimes it doesn't and you have to have therapy and ketamine treatments to adjust. (WSJ) 

If your sports team wins, you're more likely to procreate. (New Scientist) 

The 26-year-old actress who sleeps two hours a night and doesn't drink coffee. (WSJ) 

Have a confidential story, tip, or comment you’d like to share? Contact: sbutcher@efinancialcareers.com in the first instance. Whatsapp/Signal/Telegram also available (Telegram: @SarahButcher)

Bear with us if you leave a comment at the bottom of this article: all our comments are moderated by human beings. Sometimes these humans might be asleep, or away from their desks, so it may take a while for your comment to appear. Eventually it will – unless it’s offensive or libelous (in which case it won’t.)

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AUTHORSarah Butcher Global Editor
  • Se
    Seb W
    28 March 2024

    Henry Maxey seems to fail to understand that prop trading played absolutely no role in the last financial crisis. The two banks with the biggest prop trading desks with GS and JPM. Ultimately the financial crisis was down to banks like LEH having concentration risk on a business where the business model only worked where US house prices were rising and relied on money market funding.

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