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Citigroup may cut less than 300 jobs in Singapore, a sign Asia could see much smaller cuts than other regions as part of the U.S. bank’s global restructuring plan, sources told Reuters on Tuesday.
The job cuts, which will be implemented soon, are part of plans revealed by Citigroup on Monday to cut 52,000 staff globally by early next year in a dramatic move to restore the second-biggest U.S. bank to health.
“In Singapore, there will be modest headcount reductions,” a bank spokesman said. “Our business in Singapore continues to register robust year-on-year growth and remains a regional center for management and operations for Citi globally.”
Citi recently opened its 20th branch in the city-state, a growing center for financial services and private banking.
The source said over 60 percent of the cuts will be in Singapore and Hong Kong. Citi’s Asian wealth management unit excluding Japan has 1,200 people.
“We are repositioning our business to be more efficient and productive in the current difficult market conditions. As a result, some jobs will change and others may no longer be necessary,” the Citigroup spokesman said in a statement.
The job cuts in the wealth management business is a reversal of a trend seen until last year when rival banks were furiously poaching private bankers to grow their business in Asia where wealth was growing at a double-digit pace.
The dramatic plunge of financial markets has prompted wealthy clients to sell stocks and shun higher-fee products for the comfort and safety of cash, private bankers and industry experts told the Reuters Wealth Management Summit last month.
Citi’s wealth management unit in Asia including Japan managed $288 billion worth of assets at the end of the third quarter of 2008, down 7 percent from the same period a year ago.
The unit, which includes the private bank as well as Smith Barney Australia and Citi Nikko Cordial in Japan, earned net income of $59 million in the third quarter, down 58 percent from a year ago, according to Citi data.
UBS, HSBC, and Citi are considered the top three players in Asia’s private banking market.