Following Citigroup's announcement that it would cut 11,000 jobs and restructure its businesses, CFO John Gerspach told analysts and investors the move was a "fairly comprehensive initial foray" into its new strategy.
Gerspach fielded questions Wednesday at (NYSE: GS) Financial Services Conference about the progress of the bank's rightsizing and whether this round represented the bulk of what the company was expecting under its new chief executive, Michael Corbat.
The phrase is a juxtaposition in and of itself, but an accurate one. While Citigroup has been on a downsizing trend since 2007 (counting this announcement, headcount is down 33 percent from 375,000 employees at peak), it represents the first major, strategic decision by Corbat, who is only 50 days into the job.
Investors like the strategy - for now. The stock closed higher Wednesday by 6.33 percent. Nomura Analyst Glenn Schorr said the announcement was a "step in the right direction," while CLSA Analyst Mike Mayo called the reorganization "an initial 'tremor'" where an earthquake is needed.
With activist investor Trillium Management pushing for Citigroup to study a break-up, it would seem this would be the first of many defining announcements from the House of Corbat.
Considering the sheer magnitude and global reach of the cuts, combined with former CEO Vikram Pandit's penchant for tightening the bank's belt, it would appear this round of rightsizing has been in the works for some time. But for Corbat, who is just working through his initial strategic plans and budget, choosing exactly where and how to implement them was no small task. By identifying these "efficiencies" - to borrow Gerspach's term - and selling down the bank's dwindling pool of assets, the aim is to remove big drags on returns, something that has plagued Citi's stock since the financial crisis.
One of the biggest drags is Citi Holdings, the "bad bank" holding the underperforming assets where Corbat formerly served as chief. Gerspach said Citi will move "swiftly" to sell off what is left in the portfolio, doing so in a way that does not compromise valuation or require Citi to provide financing to a potential buyer.
-Written by CNBC's Kayla Tausche. CNBC's Jesse Bergman contributed reporting. Follow Kayla on Twitter: @KaylaTausche