Citigroup brings out a bigger Ax

A shell of its former cash-loaded banking self, Citigroup (C) delivered another blow to its workforce today with the announcement of over 50,000 job cuts. The cuts are all part of an effort to reduce costs by 1/5th at the bank, which has seen its shareholders lose 67% of their value year-to-date.

CEO Vikram Pandit told reports of the plans to reduce company headcount to 300,000 in the "near-term". This latest round of cuts come on the heels of a worsening economic climate and an already slashed workforce by 23,000. The company which has struggled to capitalize itself amidst massive write-downs and losses paid only a $0.16/share dividend at the end of October. For comparison, the company paid $0.54/share in 2007 and $0.32/share earlier this year.

On the bright side for Citi, its situation is not unlike most other major banks over the course of the year. If that can even be considered a bright side. The turbulence in the credit markets and the sub-prime mortgage meltdown has left its fair share of well documented casulties. With Citi shares hovering under the $10 barrier Investors are sending a powerful message that something has to be done and soon or they will completely lose faith in the turn-around story Citigroup wants to champion in the years to come. If these drastic cuts are any indiciation, its that Citigroup is doing as much as it can to shore up its books, remain afloat, and capitalized enough to continue doing business well into the future.

Disclosure: Author owns C