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Citigroup CEO Jane Fraser has received an encouraging nod from billionaire investor Warren Buffett to proceed with the bank's overhaul.

A person familiar with the matter told Reuters that Buffett and Fraser recently met for lunch, and Fraser recounted this meeting on a conference call with managing directors on Thursday.

Meeting of Warren Buffett and Citigroup CEO Jane Fraser

The source said this narrative of Warren Buffett advising Jane Fraser to keep going with the bank's overhaul concluded her address to Citigroup bosses.

During the call, the source noted that Fraser told the managing directors that more information on the next round of the reorganization would be shared next week.

Fraser is reportedly engineering Citigroup's most extensive revamp in decades, cutting layers of management and staffing as part of her effort to boost the bank's returns and share price.

The bank has been lagging behind peers and recently reported "very disappointing" fourth-quarter results.

A Berkshire Hathaway representative told Reuters that Buffett, the company's CEO, had confirmed the lunch took place. However, he declined to provide more details about the conversation.

Warren Buffett's Berkshire Hathaway Investment in Citigroup

The Warren Buffett-led conglomerate Berkshire Hathaway reportedly bought $3 billion in shares of Citigroup in 2022, lifting its stock and elevating confidence in the Wall Street bank. LSEG data shows Buffett remained among the top five shareholders of Citigroup as of September 2023.

Motley Fool reported that Fraser's restructuring vision emulated Buffett's strategy at Berkshire Hathaway, focusing on the company's most promising bets, with managers enabled to make important decisions on areas they understood best.

Since the billionaire jumped in, most of Citigroup's restructuring has reportedly tracked expectations. The bank decreased managerial layers from 13 to eight, eliminated 60 committees and many foreign business units, and is now in the process of removing thousands of positions, many of which were executive roles with high salaries.

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Warren Buffett, Citigroup, Berkshire Hathaway, Citigroup Inc.