Citigroup has announced a significant restructuring of its IT workforce, planning to reduce its reliance on IT contractors by 30%. This move is part of a broader strategy to strengthen internal technology capabilities and address regulatory concerns over data governance and risk management.
Citigroup aims to reduce the proportion of external contractors in its IT workforce from the current 50% to just 20%. This will involve replacing contractors with full-time employees to enhance control and oversight.
As part of this transition, Citigroup plans to increase its internal IT staff to 50,000 by the end of 2025, up from 48,000 in 2024. This indicates a substantial investment in building in-house expertise.
Citigroup will consolidate its IT operations, relocating teams from Rutherford, New Jersey, to a new facility in Jersey City. This consolidation is expected to improve collaboration and efficiency.
This decision follows regulatory penalties, including a $136 million fine imposed in 2024 for deficiencies in data governance. A recent $22.9 million fraud incident involving external contractors further highlighted the risks associated with outsourcing.
Citigroup's leadership has emphasised the need to enhance operational safety and soundness by bringing critical technology functions in-house. The goal is to improve data governance, risk management, and compliance with regulatory standards.