Citigroup plans to cut 20,000 jobs globally by 2026

US banking and financial services giant Citigroup is planning to lay off 20,000 of its workforce - roughly 8 per cent of its 239,000 global headcount by 2026, as part of a mega restructuring.

While the job-cuts are one of the biggest, the actual reduction in jobs, including other restructuring initiatives, could vary from 60,000 to 180,000, according to Citigroup.

"In all, Citigroup’s firmwide headcount will decline by 60,000 jobs to 180,000 by the end of 2026," its chief financial officer Mark Mason said.

The layoff decision follows a disappointing fourth quarter (October-December 2023) which was marred by one-off charges that resulted in a $1.8 billion loss. Citigroup's fourth-quarter performance fell short of expectations. "The fourth quarter was very disappointing," CEO Jane Fraser said.

As part of the restructuring, Citigroup will spin off the Mexican consumer unit Banamex. The company will be separately listed through an initial public offer, so that it will not form part of Citigroup, a Reuters report quoted CFO Mason as saying.

This would effectively remove 40,000 jobs at the Mexican consumer unit Banamex from Citigroup’s workforce, according to the report.

Citigroup expects the severance payments and Fraser’s restructuring to cost about $1 billion this year.

In a regulatory filing on Wednesday, Citigroup reported a quarterly loss of $3.8 billion in charges that included reorganisation expenses, a reserve related to currency devaluations and instability in Argentina and Russia and a $1.7 billion repayment of a government deposit insurance fund.