Citigroup logo
Dreamstime
Citigroup posted a 46% drop in profit for the first quarter but its financial results still topped analysts’ estimates.
The bank posted earnings of $2.02 a share on $19.2 billion of revenue, well ahead of earnings of $1.43 a share on revenue of $18.2 billion forecast by analysts surveyed by FactSet. Net income totaled $4.3 billion, down by nearly half from the year-ago quarter as the bank contended with higher credit costs and other other expenses.
While Citigroup’s (ticker: C) financial results are closely watched, Wall Street is also interested in getting a more qualitative update from the bank. Last month, at its first investor day in five years, CitIgroup unveiled medium-term financial targets and spoke of efforts it is making to improve internal controls and streamline its operations.
“While the geopolitical and macro environment has become more volatile, we are executing the strategy we announced at our recent Investor Day,” Citigroup Chief Executive Jane Fraser said in prepared remarks Thursday.
Last year, Citigroup named Russia as one of 13 consumer markets it was planning to exit. Doing so has become more complicated due to Russia’s invasion of Ukraine and the bank warned last month that it could take a $4 billion hit from its exposure to the country. In Thursday’s results, that figure was lowered to a range of $2.5 billion to $3 billion, reflecting efforts the bank has taken over the last few months to minimize risks.
Operating expenses at Citigroup increased 10% from the year-ago quarter, excluding the one-time expense of the divestiture of its Asia consumer business, as the bank spends to improve its operations.
Trading revenue was down slightly at the bank while it posted a 32% drop in investment banking and corporate lending revenue.
Citigroup said it returned $4 billion to shareholders during the first quarter.
“While we are making necessary investments in our infrastructure, risk and controls and our businesses, we remain committed to improving our returns over the medium term,” Fraser said.
Shares of Citigroup climbed 3% in premarket trading. The bank will hold a call with analysts at 11 a.m. Eastern.
Citigroup’s earnings follow JPMorgan Chase ’s (JPM) results on Wednesday as well as results from Morgan Stanley (MS), Goldman Sachs (GS), and Wells Fargo (WFC) on Thursday, Bank of America (BAC) posts results on Monday.
Write to Carleton English at [email protected]
