Pandit, who took over the helm of the listing US financial conglomerate in December, is preparing to cut up to 25,000 jobs and undertake a major re-alignment of the firm's information technology and operations with the objective of excising 20% iof the group's cost base.

"It is clearly feasible for us to take 10, 15, 20 per cent off our cost base, especially in information technology and operations," Pandit told the Financial Times.

Citi employs an army of some 23,000 developers and expends tens of billions of dollar a year on its IT operations. The IT department is highly decentralised, a situation that looks set to be reversed under the overhaul. One of Pandit's first moves has been to centralise IT decisions in New York under chief administrative officer Don Callahan, says the FT.

The cost-cutting is not confined to Citi. Merrill Lynch yesterday announced plans to slash 4000 jobs after racking up more losses in the first quarter. Swiss bank UBS was also reported yesterday to be shedding 900 jobs from its City offices.