Citigroup announced on Wednesday that it will cut 11,000 jobs, or 4 percent of its workforce, in an effort to trim expenses.

The moves comes one month after Citigroup paid out nearly $14 million to two former executives, CEO Vikram Pandit and Chief Operating Officer John Havens, who were ousted for poor management. The Citigroup board forced Pandit out, “after a series of missteps this year left some directors feeling that the company wasn’t being managed effectively and that the board wasn’t kept adequately informed.”

Under Pandit and Havens, Citigroup lost 88 percent of its stock value. Still, the executives walked away with generous pay packages:

Vikram Pandit, Citigroup Inc. (C)’s ousted chief executive officer, will get about $6.7 million in 2012 compensation and will forfeit some awards tied to a $40 million retention package granted last year.

John Havens, who resigned last month as Citigroup’s chief operating officer on the same day as Pandit, will get about $6.8 million for 2012 and also forfeit some awards, the New York- based lender said yesterday in a regulatory filing. Citigroup is the third-largest U.S. bank by assets.

“Based on the progress this year through the date of separation, the board determined that an incentive award for their work in 2012 was appropriate and equitable,” Chairman Michael E. O’Neill said in the filing.

It is something of a trend for corporations to pay top executives high salaries, while employees feel the consequences of a struggling company. After failed Twinkie-maker Hostess declared bankruptcy, it cut workers’ pay 8 percent, but left the CEO’s $1.5 million salary untouched.

Citigroup CEO Vikram Pandit was pushed out the door of his company in October after overseeing a precipitous decline in his bank’s value. Overall, Citigroup lost nearly 90 percent of its stock price during Pandit’s tenure. But that won’t stop Pandit from walking off with $6.7 million for his last year on the job:

Citigroup said Friday that the former CEO, who resigned last month in a management shakeup, will receive an “incentive award” of $6.7 million for his work at the bank this year. Former president and chief operating officer John Havens, who stepped down along with Pandit, is getting $6.8 million, according to a filing with the Securities and Exchange Commission.

The two men will also continue collecting deferred cash and stock compensation from last year, awards valued at $8.8 million for Pandit and $8.7 million for Havens.

The company suffered a profit loss of 88 percent during the third quarter, when Pandit supposedly earned his “incentive award.” During his time at Citi, Pandit made some $260 million in total compensation, even accounting for the year he took a $1 salary during the financial crisis.

Several Wall Street heavyweights have recently said that banks need to rethink the sky-high compensation they’ve been paying (which has helped exacerbate the nation’s income inequality). For instance, Morgan Stanley CEO called the financial industry “overpaid.” “There’s way too much capacity and compensation is way too high,” he said.

Citigroup CEO Vikram Pandit unexpectedly resigned yesterday. He was one of just three major bank CEOs who had led their firms through the 2008 financial crisis that was still at the helm.

Pandit left having made $260 million with Citi, including his annual compensation as CEO and the money he made when he sold his hedge fund to Citi in 2007. But to hear CNBC host Maria Bartiromo tell it, Pandit quit because he hadn’t made enough money and because he was getting “bashed and bashed again by the President, by the populists”:

Let’s face it, we have an individual here who sold his hedge fund to Citi for $800 million, taking the CEO role five years ago, and then during the financial crisis agreeing to work for $1. Getting bashed and bashed and bashed again by the President, by the populists, and he probably just said to himself, “look, I’m done. If they’re not going to pay me commiserate with what some of my colleagues in banking are making, I can’t work for a dollar anymore.”

CNBC’s Jim Cramer added later, “you know what, I think people in general, they welcome any change at the banks, including our President.” Watch it:

Pandit indeed worked for $1 following the financial crisis. But he was awarded $15 million last year, despite his company’s precipitous decline. Overall, he’s been paid hundreds of millions of dollars as his company lost 88 percent of its value.

Citigroup CEO Vikram Pandit abruptly resigned today, leaving the helm of the bank that he guided through the financial crisis of 2008. For his five years of leading Citi, Pandit will receive compensation in the neighborhood of $260 million:

If no alterations are made to Pandit’s compensation package, Citigroup will have paid him about $261 million in the five years since he became CEO, including his personal compensation and about $165 million for buying his Old Lane Partners LP hedge fund in 2007 in a deal that led to his becoming CEO. The bank shut Old Lane soon after Pandit took the post, causing a $202 million writedown.

But while Pandit made off like a bandit, shareholders were not so lucky. Via Matt Yglesias, here’s Citigroup’s stock performance since Pandit took over:

Overall, Citi lost 88 percent of its value under Pandit. Earlier this year, the Wall Street Journal dinged Pandit for having the pay package that was most detached from his company’s performance, as a three-year decline of 27 percent coincided with his making $43 million. The Dodd-Frank financial reform law gave shareholders the right to hold a non-binding vote on executive compensation, and Pandit was the first bank CEO to get tagged with a vote of disapproval.

In the late 1990s, Citicorp made waves on Wall Street by pioneering what is known as “supermarket banking” — the idea that financial institutions could provide a host of services, including stock trading, real estate brokerage, and insurance, in addition to traditional deposit banking. Citicorp, led by chief executive Sanford Weill, purchased insurance giant Travelers Group and became Citigroup, and in subsequent years, other banks followed its model, creating the financial supermarkets that are prevalent today.

A decade and a half and a major financial crisis later, current Citigroup CEO Vikram Pandit now says the supermarket model is no longer a viable option for his bank, which nearly collapsed in the 2008 banking crisis that helped trigger the Great Recession. In a presentation at Singapore’s Lee Kuan Yew School of Public Policy, Pandit said supermarket banking “is a strategy that I don’t believe is right for the times,” American Banker reports:

The 1998 merger of Citicorp with insurer Travelers Group Inc. “didn’t turn out to be everything people thought it was going to be,” Pandit said today during a presentation at Singapore’s Lee Kuan Yew School of Public Policy. “The focus of that merger, which was supermarket banking or financial supermarket, is a strategy that I don’t believe is right for the times. Not only that, I don’t believe it’s right for our bank.”

Weill, the original architect of supermarket banking, said last month that it was time to break up the big banks, a position that has been echoed by other former banking executives. Pandit said this week that he disagrees with that sentiment because Citigroup has returned to the core of what it was before it was a supermarket. “Getting out of that strategy is what we’ve done,” Pandit said. “And now we focus on what is really the core banking business of this institution.”

Whether Citi has actually returned to its commercial banking roots is questionable. The New York Times reported that Citi had more assets in risky global capital markets in the second quarter than any bank but Goldman Sachs, and it is “more reliant on often volatile Wall Street businesses” than it used to be. “In 1998,” the Times wrote, “Citicorp’s trading revenue was 8 percent of its total revenue. By contrast, trading revenue last year accounted for 23 percent of the Citicorp unit’s total.” Citi did, though, announce earlier this year that it would cut its proprietary trading desk ahead of implementation of the Volcker Rule, which bans banks with government backing from engaging in risky prop trades.

Richard Parsons, the former chairman of mega-bank Citigroup (who stepped down from his post just a few days ago), said yesterday that the repeal of Glass-Steagall — the Depression-era regulation separating investment and commercial banking — helped precipitate the financial crisis of 2008:

Richard Parsons, speaking two days after ending his 16-year tenure on the board of Citigroup Inc. (C) and a predecessor, said the financial crisis was partly caused by a regulatory change that permitted the company’s creation. [...]

“To some extent what we saw in the 2007, 2008 crash was the result of the throwing off of Glass-Steagall,” Parsons, 64, said during a question-and-answer session. “Have we gotten our arms around it yet? I don’t think so because the financial- services sector moves so fast.”

It was Citigroup that was the first big beneficiary of the repeal of Glass-Steagall, which allowed Citibank to merge with Traveler’s Group to form Citigroup. Former Citigroup Chairman Sandy Weill used to have a portrait on his office wall that proclaimed him, “The Shatterer of Glass-Steagall.” Of course, Citigroup needed to bailed out during the financial crisis of 2008.

Parsons is not the only former Citi executive to see the light of day when it comes to deregulation. Former CEO John Reed has said that investment banking and commercial banking should once again be separated, taking banking back to where it was before the deregulatory zeal of the 1990s took hold.

Parsons doesn’t advocate such a step, and of course, his admission is more than a decade too late. “Why didn’t he do something about it when he had a chance to?” asked financial analyst Mike Mayo. Just yesterday, federal regulators gave banks two years to fully comply with new rules meant to prevent them from engaging in risky trading with taxpayer-backed dollars.

As Reuters’ Felix Salmon noted, Citigroup CEO Vikram Pandit went to the Davos Economic Forum to announce that job creation should be a top priority for the international business community:

The 42nd World Economic Forum Annual Meeting closed today, with business leaders urging resolute action to promote growth and employment, particularly among young people. “Jobs should be our number one priority,” declared Annual Meeting Co-Chair Vikram Pandit, Chief Executive Officer of Citi, in a session on the global agenda for 2012. “Ultimately it is about growth. Nothing creates jobs better than growth.”

But this proclamation comes just seven weeks after Citigroup announced 4,500 job cuts, and some analysts think those job cuts are just the “tip of the iceberg.” Overall, the financial industry cut 200,000 jobs in 2011. Bank of America has announced 30,000 job cuts that will take place over the next several years.

“Everybody knows, in any case, that profits are Pandit’s number one priority; to be honest I’d be surprised if jobs are on his priority list at all,” Salmon noted. “The markets like it when big banks cut jobs, and hate it when they add jobs. And Pandit’s job is to do what the market wants. Which is, fire people.”

To explain how to boost growth, Pandit broke out the favorite right-wing canard about “uncertainty” holding back job creation. But as economist Bruce Bartlett has pointed out, “regulatory uncertainty is a canard invented by Republicans that allows them to use current economic problems to pursue an agenda supported by the business community year in and year out.”