Citigroup and Bank of America have cut the pools of bonus money set aside for traders and other employees, as Wall Street scrambles to adjust its expenses following a surprisingly weak December.

Choppy markets appear to have caught some bank trading desks flat-footed, wiping out gains they had accumulated earlier in the fourth quarter, traders and analysts said. Although not all big banks were hit with the holiday blues this past month, the late adjustments reflect the volatility in the results of the firms' securities divisions, and how traders' full-year performance can be cinched-or come undone-in a few frenzied weeks.