Citi slashes IT contractors in major workforce overhaul: Reuters
LONDON, UNITED KINGDOM and NEW YORK, UNITED STATES — Citigroup is fundamentally altering the method by which it employs technology professionals, ending the engagement of external contractors and promoting the recruitment of in-house staff, which could indicate that more financial companies may reevaluate their approaches to IT management.
Strategic change from outsourcing to in-house staffing
In an exclusive report by Reuters, the banking corporation is looking to decrease the number of its IT contractors from 50% of the technology workforce to 20%, as stated in an internal document by Citigroup’s head of technology, Tim Ryan. As part of this transformation, Citi is looking to increase its technology employee count to 50,000 by 2024, up from the current 48,000.
“Citi is growing our internal technology capabilities to support our strategy to improve safety and soundness, enable revenue growth and drive efficiencies,” Citigroup told Reuters.
This strategic shift occurs as the bank faces various regulatory and control issues. In June 2024, U.S. regulators fined Citigroup $136 million for not making sufficient progress in fixing data management deficiencies that were spotted in 2020. Ryan joined the bank from PwC in June last year, right after this regulatory action.
Vendor consolidation and geographic strategy
Furthermore, the restructuring is not only about hiring but also includes reducing the number of external suppliers. Citigroup could downsize its current number of IT vendors from 144 to just 50, as per the internal briefing. The bank also wants to increase the share of workers in higher-cost locations, such as New Jersey, New York, and Irving, while keeping centers in lower-cost countries, including Chennai (India), Belfast (UK), and Warsaw (Poland).
This vendor consolidation may affect major IT service providers in the future. Although the names of the vendors at risk have not been revealed yet, Citigroup has worked with companies like TCS (ranked #8 in OA500 2025) after acquiring Citi’s India-based captive business process outsourcing (BPO) arm, Citigroup Global Services Limited, in 2008; Wipro (ranked #3 in OA500 2025) after securing a $500 million contract in 2013; and Cognizant Technology Solutions Corp (ranked #7 in OA500 2025).
The change was implemented after several technical issues at the bank, including a significant error in April 2024 when Citigroup sent its customer a wrong statement that showed the account had $81 trillion instead of $280.
“It seems to be one more step on the reconfiguration of their systems to fix long-standing problems,” said Mike Mayo, a bank analyst at Wells Fargo. “They are better than they were a decade ago, but still need to improve.”
