Citigroup loses $5.1B, will cut 9,000 jobs

NEW YORK -- Write-downs related to mortgages and turmoil in the credit markets reached about $12 billion, and costs stemming from consumers' credit problems surpassed $3 billion, the bank said Friday. And in a conference call with analysts, Citigroup Chief Financial Officer Gary Crittenden said the bank, seeking to cut costs, is cutting about 9,000 additional jobs.

That means Citigroup is cutting 13,200 jobs in all. In January the bank said it was cutting 4,200 jobs.

The most recent quarterly shortfall at the nation's biggest bank by assets was not as massive as the nearly $10 billion loss it suffered in the fourth quarter of last year, though.

Citigroup shares rose as many investors had been bracing for even more dismal results. Citigroup's stock has fallen 18% since the beginning of the year.

"It's a cathartic quarter," said Arthur Hogan, chief market analyst at Jefferies & Co in Boston. "Vikram Pandit is coming in and making pretty big changes."

But Citigroup essentially lost in the first three months of the year, $1.02 a share, what it made in the same period in 2007 — $5 billion, or $1.01 a share. Analysts, on average, had expected the New York bank to lose 95 cents a share, according to a Thomson Financial survey.

With big exposure to mortgages and leveraged loans, Citigroup remains at risk for further write-downs. The credit ratings agency Moody's Investors Services on Friday changed its ratings outlook on Citigroup to negative, citing write-downs that were on the high side of its estimates.

In the first quarter, before taxes, Citigroup took $6 billion in write-downs and credit costs on exposure to subprime mortgages; $3.1 billion in write-downs on funded and unfunded highly leveraged finance commitments; a downward credit value adjustment of $1.5 billion related to exposure to bond insurers; $1.5 billion in write-downs on auction-rate securities; and $3.1 billion in credit costs for consumers around the world.