Editor's Note: The story has been updated after Citi clarified that the $1 billion of repositioning costs include severance and restructuring costs, most of which are already booked in the first three quarters.
On Wednesday, at the Goldman Sachs conference, Citigroup Inc C Chief Financial Officer Mark Mason reportedly disclosed the bank's largest reorganization in decades has cost about $1 billion for charges related to restructuring and severance.
The overhaul is expected to be fully completed by the end of the first quarter of next year, reported Reuters.
$1 billion includes $600 million of severance costs incurred year-to-date and the remaining $400 million in restructuring costs for the fourth quarter of 2023
According to the report, Citigroup plans to trim down management and potentially lay off thousands of employees.
Related: Citigroup Restructures, Targets 10% Senior Management Layoffs
The bank expects to reduce annual expenses to $51 billion-$53 billion, which can help meet profit targets, as per the report.
The bank projects 2023 expenses of $54 billion, which excludes a special assessment from the Federal Deposit Insurance Corp. of around $1.65 billion.
Mason anticipates some restructuring charges (about $200 million) to be booked in Q4 and sees 2023 revenue at the lower of its previous guidance at around $78 billion.
After the restructuring, the bank expects to attain a medium-term return on average tangible common shareholders equity of 11% to 12% in the medium term.
Also Read: Citigroup Eyes New Private Credit Strategy Next Year: Report
Price Action: C shares are trading higher by 1.67% at $48.66 on the last check Thursday.
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