Citibank’s Massive Tech Spend and Business Transformation
Citibank's commitment to technological advancement is evident in its substantial investment of $12.2 billion in technology last year, marking a 9% increase over 2022, as reported in the Q4 2023 earnings report released on Friday.
Citibank's commitment to technological advancement is evident in its substantial investment of $12.2 billion in technology last year, marking a 9% increase over 2022, as reported in the Q4 2023 earnings report released on Friday. This significant investment follows the bank's tech spends of $11.2 billion in 2022 and $9.9 billion in 2021.
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A noteworthy portion of the tech spend in the past year was allocated to modernization initiatives, with the bank successfully retiring nearly 400 legacy applications. CEO Jane Fraser emphasized the progress of the tech infrastructure modernization during a recent earnings call, highlighting the delivery of new capabilities to clients and the consolidation of trading and reporting platforms. Fraser also noted the retirement of 6% of legacy applications for the second consecutive year.
The tech investments are integral to Citibank's broader business transformation strategy, which aims to streamline the bank's operations, re-architect its data infrastructure, and enhance automation. As part of this restructuring, the company plans to reduce its workforce by 20,000 positions by 2026, including the elimination of 5,000 managerial roles by the end of March. Notably, the bank has already eliminated 300 senior management roles and restructured its tech leadership team, appointing Jonathan Lofthouse as co-CIO following the departure of Stuart Riley. Additionally, Citibank bolstered its transformation workforce by adding 8,000 technologists earlier in the year.
Despite reporting a net loss of $1.8 billion on revenues of $17.4 billion in the last quarter of 2023, the bank achieved a net income of $9.2 billion for the year. The ultimate goal of these tech investments is to drive transformation and increase revenue, reflecting Citibank's commitment to adapting to the evolving financial landscape.
Citibank's substantial tech spend and modernization efforts underscore its dedication to leveraging technology to enhance its operations and deliver value to its clients. The bank's ongoing business transformation, coupled with its strategic tech investments, positions it for sustained growth and success in the future.
Citibank’s Massive Tech Spend and Business Transformation
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