Normally, a reorganization is fodder for a “Dilbert” strip or maybe an entire arc if it’s particularly funny or unusual. But Citigroup (NYSE:C) threw aside the comparisons and pressed for a major new facelift to shake itself out of its slump. The results may not have been as dramatic as hoped for, but with investors buying in, the news may be good enough for this bank stock.
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Jane Fraser herself, the current CEO of Citigroup, launched the reorganization on Wednesday with plans to pare back layers of management infrastructure and step up the decision-making process. Citigroup may have wound up too big for its own good, as agility suffered and infighting left new initiatives to die on the vine. The number of jobs cut out of all these management layers is unclear as of yet, but undoubtedly a few former pointy-haired bosses will be shown the door.
Under the new corporate structure, meanwhile, business will be sorted into five key sectors, and one representative from each will report directly to Fraser herself. The businesses in question are: institutional services, investment and commercial banking, wealth management, U.S. personal banking, and trading. Further, Citigroup is also pulling back on its overseas involvement, consolidating divisions and even closing some of them outright in a bid to make processes more efficient and focused.
Analysts, meanwhile, will likely give Citigroup the benefit of the doubt. With six Buy ratings, 10 Holds, and one Sell, Citigroup stock currently has a Moderate Buy consensus rating. Further, Citigroup stock offers investors a 25.17% upside potential thanks to its average price target of $53.09.
