According to U.S Banker magazine, more than 19,000 jobs were cut in 2006. Much of this was deal-driven. The Bank of America-MBNA deal itself cut 6,000 positions. You have to think that consolidation will continue, especially at the regional level. At the top layer, while fill-in deals will be plentiful, people continue to hope for truly transformative deals, especially regarding Wachovia and Wells Fargo. It is likely that one more megabank could be created, and 2007 would be a decent year to make that happen. At the very top, all eyes continue to be on Citigroup and Bank of America. In 2006, their stock prices were low enough that both were deemed to be takeover candidates by no less than Morgan Stanley's chief investment strategist. Both fared better at the end of the year. Citigroup's move to new highs was unexpected and reflects the heavy expectations on the company. For Citigroup, the name of the game is cutting costs and growing internationally. As always, it will set the tone, even though Bank of America is now its market cap equal.

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