Citigroup will merge corporate, investment banking

Citigroup Inc. will merge its investment and commercial banking operations as part of an attempt to integrate its businesses and successfully emerge from a financial crisis that forced it to accept a government rescue, according to a media report Tuesday. 

The Financial Times, citing unnamed sources, reported that the move could be announced internally as early as next week, and is part of Chief Executive Vikram Pandit's effort to restore Citi's fortunes after it succumbed to massive credit-related losses and was rescued by the U.S. government last month. 

The new, combined unit will be aimed at increasing Citigroup's ability to sell products ranging from loans to advice on takeovers, the Financial Times reported. 
Citigroup rivals including JPMorgan Chase already have structures where a single banker is able to offer clients a suite of services, according to the report. The merged unit will be headed by John Havens, the head of Citigroup's securities and investment banking division and "the most influential Citi executive after ... Pandit," the report said. 

The move is unlikely to add to the 75,000 job cuts already announced by the firm, according to the report. 

Government officials agreed to a $326 billion rescue of Citigroup in November, in a deal that gave the U.S. a 7.8% stake in the firm, once the largest domestic bank. 

The move, which followed a more than 60% skid in Citigroup shares, was one of many taken by the government to prop up the ailing financial sector and restore investor confidence. 

Following the disastrous collapse of Lehman Brothers Holdings Inc. earlier this year, the government stepped in to rescue giant insurance company American International Group Inc. and back the sale of massive thrift Washington Mutual Inc. to JPMorgan, while storied Wall Street firm Merrill Lynch & Co. was pushed into merger with Bank of America Corp.