Citigroup aims to double savings

25 April 2007
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26 April 2007 | Paul Snell

Citigroup is to centralise all procurement by 2009.

But buyers at the bank face a nervous wait to see if any of their jobs are to be among the 17,000 posts the firm intends to cut under another part of its new cost savings plan.

The announcements were made as part of a collection of measures to more than double the amount of savings the firm intends to make.

It wants to increase cost savings from $2.1 billion (£1 billion) in 2007 to $4.6 billion (£2.3 billion) by 2009. The company said the savings would not affect investment or services.

As a result of current cost savings programmes the bank has centralised around 65 per cent of its purchasing. It wants to increase this to 80 per cent by the end of 2007 and extend it to all purchases by the end of 2009. But the group refused to say how this would be achieved.

A plan to consolidate back and middle-office functions also means moving 9,500 jobs to lower-cost locations. The use of shared services will also increase. It is hoped this will improve economies of scale across the business.

The bank would not comment on specific job numbers by "business or function".

The group said continuous improvement would produce additional savings.

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