JPMorgan and Citigroup results show that deals and fundraising can still get done amid volatility and uncertainty, @PaulJDavies says (via @opinion) https://t.co/dIKQfd8ISU ...

Core Insights - Citigroup Inc. reported a second-quarter 2025 adjusted net income per share of $1.96, reflecting a 28.9% increase year-over-year and exceeding the Zacks Consensus Estimate by 21.7% [1][10] - The company's shares rose by 1.2% in pre-market trading following the release of these results [1] Financial Performance - Citigroup's net income on a GAAP basis for the quarter was $4.1 billion, marking a 25% increase from the same period last year [2] - Total revenues, net of interest expenses, increased by 8% year-over-year to $21.7 billion, surpassing the Zacks Consensus Estimate by 3.3% [3] - Net interest income (NII) rose 12% year-over-year to $15.2 billion, while non-interest revenues fell by 1% to $6.5 billion [3] Expense and Revenue Breakdown - Operating expenses increased by 2% year-over-year to $13.6 billion, primarily due to higher compensation and benefits expenses [4] - In the Services segment, revenues were $5.1 billion, up 8% year-over-year, driven by growth in Treasury and Trade Solutions [5] - The Markets segment saw a 16% increase in revenues to $5.9 billion, attributed to growth in Fixed Income and Equity markets [5] - Banking revenues rose 18% year-over-year to $1.9 billion, mainly due to growth in investment banking and corporate lending [6] - U.S. Personal Banking revenues increased by 6% to $5.1 billion, while the Wealth segment's revenues rose 20% to $2.2 billion [6] Balance Sheet and Capital Position - At the end of Q2 2025, Citigroup's deposits increased by 3% to $1.36 trillion, and loans also rose by 3% to $725.3 billion [8] - The Common Equity Tier 1 capital ratio was 13.5%, slightly down from 13.59% in the previous year [12] - The supplementary leverage ratio decreased to 5.5% from 5.89% year-over-year [12] Credit Quality and Provisions - Total non-accrual loans surged by 49% year-over-year to $3.4 billion [11] - Provisions for credit losses were $2.9 billion, up 16% from the prior year, while the allowance for credit losses on loans decreased by 5% to $19.1 billion [11] Shareholder Returns - Citigroup returned $3 billion to shareholders through dividends and share repurchases, and increased its dividend by 7.1% to 60 cents per share starting in Q3 2025 [10][13][14] Strategic Outlook - The company is focusing on business transformation initiatives, including exits from non-viable segments and organizational simplification, which are expected to enhance long-term results [15][16]

Citi shares rose to the highest level since 2008 after the bank said it would ramp up stock buybacks following a strong result in regulatory stress tests https://t.co/utJt9VNnG4 ...

Core Viewpoint - Citigroup's CEO Jane Fraser announced that the company is exploring the issuance of a stablecoin [1] Group 1 - The exploration of a stablecoin aligns with the growing interest in digital currencies within the financial sector [1] - Citigroup aims to leverage its expertise in banking and technology to develop a stablecoin that meets regulatory standards [1] - The move reflects a broader trend among financial institutions to innovate and adapt to the evolving digital landscape [1]

Financial Data and Key Metrics Changes - The company reported a net income of $4 billion and earnings per share of $1.96, with a return on tangible common equity (ROTCE) of 8.7% [4][19] - Revenues increased by 8% year-over-year, driven by growth across all business lines, with total revenues reaching $21.7 billion [4][19] - Net interest income excluding markets rose by 7%, while non-interest revenues, excluding markets, increased by 1% [20] Business Line Data and Key Metrics Changes - Services revenue grew by 8%, with a ROTCE of 23% for the quarter, driven by robust growth in loans and deposits [5][30] - Markets revenues increased by 16%, with fixed income revenues up 20% and equities revenues up 6% [6][31] - Investment banking fees rose by 13%, with M&A activity up 52% and equity capital markets (ECM) up 25% [33] - Wealth management revenues surged by 20%, with a pretax margin of 29% [35] - U.S. Personal Banking (USPB) revenues increased by 6%, driven by branded cards and retail banking [37] Market Data and Key Metrics Changes - The company experienced strong client activity in both fixed income and equities, with significant growth in prime services and derivatives [6][31] - The average loans increased by 3% across the firm, with a diversified deposit base also growing by 3% [25] Company Strategy and Development Direction - The company is focused on executing its strategy with discipline, improving performance and returns across its businesses while advancing their strategic positions [5][12] - Investments in digital assets and stablecoin infrastructure are being prioritized to enhance competitiveness and client offerings [13][86] - The company aims to achieve a ROTCE target of 10% to 11% next year, viewing it as a waypoint rather than a destination [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the U.S. economy, driven by strong consumer activity and entrepreneurial spirit [15] - The company anticipates some macroeconomic uncertainties but remains optimistic about its trajectory and ability to deliver for clients [16] - The outlook for the full year has been adjusted to expect revenues around $84 billion, with net interest income excluding markets projected to rise closer to 4% [40] Other Important Information - The company returned over $3 billion in capital to shareholders, including $2 billion in share repurchases [9][10] - The CET1 capital ratio stood at 13.5%, significantly above regulatory requirements, with plans for continued share repurchases [10][27] Q&A Session Summary Question: Long-term return profile beyond 2026 - Management refrained from providing specific targets for 2027 but expressed confidence in the firm's strategy and performance across its business lines [45][46] Question: Revenue forecast for the second half of the year - Management acknowledged the seasonality in the second half and indicated that the forecast includes expected market softness [60][64] Question: Capital management and regulatory reforms - Management discussed the binding constraint of standardized CET1 and the ongoing assessment of capital buffers in light of regulatory changes [68][70] Question: Transformation costs and consent order - Management indicated that transformation costs are expected to increase in 2025 but will trend down in 2026, with ongoing efforts to improve operational efficiency [90][94]

Core Viewpoint - Citigroup's CEO stated that the company is exploring the possibility of issuing a stablecoin [1] Group 1 - The exploration of stablecoin issuance indicates Citigroup's interest in digital currencies and blockchain technology [1]

Core Viewpoint - Citigroup maintains its target price for gold at $3,300 per ounce for the 0-3 month period [1] Group 1 - Citigroup's target price reflects a bullish outlook on gold in the short term [1]

Core Insights - The unofficial start of the earnings season was marked by Citigroup Inc and Wells Fargo & Co reporting second-quarter earnings and revenue beats, with Citigroup benefiting from higher banking and markets revenue, while Wells Fargo lowered its income forecast [1] Group 1: Citigroup Inc - Citigroup's stock increased by 1.1%, trading at $88.55, and is on track for its third gain in the last four sessions after reaching a 17-year high of $90.66 [2] - Year-to-date, Citigroup shares have a 26.6% gain, bouncing off a recent support level at $85 [2] Group 2: Wells Fargo & Co - Wells Fargo's stock was down 4.7%, trading at $79.45, marking its largest single-day percentage loss since March 10 and ending a four-day winning streak [3] - The stock is retreating from a previous attempt to surpass its record peak of $83.94 set on July 3, but the 20-day moving average may help contain these losses; year-to-date, Wells Fargo has a 13.4% gain [3] Group 3: Options Activity - Both Citigroup and Wells Fargo are experiencing unusual options activity, with each attracting double the typical volume for this time [4] - The most popular option for Citigroup is the July 90 call, while for Wells Fargo, it is the July 82 call, with new positions being opened for the latter [4]

Financial Performance - Citigroup reported revenues of $21.7 billion in 2Q25, an increase of 8% year-over-year[5] - Net income for 2Q25 was $4.0 billion, a 25% increase compared to 2Q24[5] - The Return on Tangible Common Equity (RoTCE) for 2Q25 was 8.7%, up from 7.2% in 2Q24[5] - Diluted Earnings Per Share (EPS) for 2Q25 was $1.96, a 29% increase year-over-year[5] Capital and Shareholder Returns - Citigroup's CET1 Capital Ratio was 13.5% in 2Q25[5] - The company returned approximately $3.1 billion to common shareholders through share repurchases and dividends in 2Q25[7] - The Board approved an increase to the common stock dividend to $0.60 per share starting in 3Q25, up from $0.56 per share[7] Business Segment Performance - Services revenues increased to $5.1 billion in 2Q25[9] - Markets revenues increased to $5.9 billion in 2Q25[9] - U S Personal Banking revenues increased to $5.1 billion in 2Q25[9]

[Citigroup Financial Summary](index=2&type=section&id=Citigroup%20Financial%20Summary) [Financial Summary](index=2&type=section&id=Financial%20Summary) In Q2 2025, Citigroup reported a net income of $4.0 billion, or $1.96 per diluted share, on revenues of $21.7 billion, driven by growth across all five core businesses, achieving an 8.7% RoTCE and 13.5% CET1 Capital ratio Q2 2025 Financial Highlights | Metric | Q2 2025 | Change vs. Q1 2025 | Change vs. Q2 2024 | | :--- | :--- | :--- | :--- | | **Revenues, net** | $21,668 M | 0% | +8% | | **Net Income** | $4,019 M | -1% | +25% | | **Diluted EPS** | $1.96 | 0% | +29% | | **RoTCE** | 8.7% | (40) bps | +150 bps | | **CET1 Capital Ratio** | 13.5% | +9 bps | (9) bps | | **Book Value per Share** | $106.94 | +3% | +7% | | **Tangible Book Value per Share** | $94.16 | +3% | +8% | - Operating expenses increased by 2% year-over-year to **$13.6 billion**, while provisions for credit losses rose **16% to $2.9 billion**, primarily due to a higher credit reserve build[2](index=2&type=chunk) [Consolidated Statement of Income](index=3&type=section&id=Consolidated%20Statement%20of%20Income) The Q2 2025 Consolidated Statement of Income shows total revenues of $21.7 billion, driven by a 12% increase in Net Interest Income, with operating expenses up 2% and credit loss provisions up 16% Q2 2025 Income Statement Breakdown (vs. Q2 2024) | Item | Q2 2025 (M) | YoY Change | | :--- | :--- | :--- | | Net Interest Income (NII) | $15,175 | +12% | | Total Non-Interest Revenues (NIR) | $6,493 | -1% | | **Total Revenues, net** | **$21,668** | **+8%** | | Total Provisions for Credit Losses | $2,872 | +16% | | Total Operating Expenses | $13,577 | +2% | | **Income from Continuing Operations** | **$4,033** | **+24%** | | **Citigroup's Net Income** | **$4,019** | **+25%** | - The growth in Net Interest Income was a key driver of the overall revenue increase, while Principal Transactions revenue also saw a significant **19% YoY rise to $3.4 billion**[6](index=6&type=chunk) [Consolidated Balance Sheet](index=4&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2025, Citigroup's total assets grew 9% to $2.62 trillion, supported by increases in loans and deposits, with total stockholders' equity rising 2% to $213.2 billion Balance Sheet Highlights (as of June 30, 2025) | Item | Amount (B) | YoY Change | | :--- | :--- | :--- | | **Total Assets** | $2,622.8 | +9% | | Total Loans, net | $706.2 | +5% | | Total Deposits | $1,357.7 | +6% | | **Total Liabilities** | $2,408.6 | +10% | | **Total Citigroup Stockholders' Equity** | $213.2 | +2% | - The increase in assets was notably driven by a **27% rise in Trading account assets** and a **43% increase in Deposits with banks** compared to the prior year[9](index=9&type=chunk) [Operating Segments](index=5&type=section&id=Operating%20Segments) [Operating Segment Overview](index=5&type=section&id=Operating%20Segment%20Overview) In Q2 2025, all five core operating segments reported year-over-year revenue growth, with Wealth Management and U.S. Personal Banking showing strong bottom-line performance Q2 2025 Segment Performance (vs. Q2 2024) | Segment | Revenues (M) | YoY Change | Income from Cont. Ops (M) | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Services | $5,062 | +8% | $1,448 | -3% | | Markets | $5,879 | +16% | $1,749 | +19% | | Banking | $1,921 | +18% | $461 | +13% | | Wealth | $2,166 | +20% | $494 | +135% | | U.S. Personal Banking | $5,119 | +6% | $649 | +436% | [Services](index=6&type=section&id=Services) The Services segment reported Q2 2025 revenues of $5.1 billion, up 8% year-over-year, driven by growth in TTS and Securities Services, with a RoTCE of 23.3% Services Q2 2025 Performance | Metric | Q2 2025 | YoY Change | | :--- | :--- | :--- | | **Total Revenues** | $5,062 M | +8% | | - Treasury and Trade Solutions | $3,674 M | +7% | | - Securities Services | $1,388 M | +11% | | **Net Income** | $1,432 M | -3% | | **RoTCE** | 23.3% | -50 bps | - Key business drivers showed positive momentum, with average deposits up **7% YoY to $857 billion** and average loans up **15% YoY to $94 billion**[16](index=16&type=chunk) [Markets](index=7&type=section&id=Markets) Markets delivered a strong quarter with revenues of $5.9 billion, up 16% year-over-year, driven by Fixed Income and Equity markets, resulting in a 13.8% RoTCE Markets Q2 2025 Performance | Metric | Q2 2025 | YoY Change | | :--- | :--- | :--- | | **Total Revenues** | $5,879 M | +16% | | - Fixed Income Markets | $4,268 M | +20% | | - Equity Markets | $1,611 M | +6% | | **Net Income** | $1,728 M | +20% | | **RoTCE** | 13.8% | +310 bps | - The segment's efficiency ratio improved significantly, decreasing by **500 basis points** year-over-year to **60%**[20](index=20&type=chunk) [Banking](index=8&type=section&id=Banking) The Banking segment reported Q2 2025 revenues of $1.9 billion, an 18% increase year-over-year, largely driven by a 13% rise in Investment Banking fees, with a RoTCE of 9.0% Banking Q2 2025 Performance | Metric | Q2 2025 | YoY Change | | :--- | :--- | :--- | | **Total Revenues** | $1,921 M | +18% | | **Net Income** | $463 M | +14% | | **RoTCE** | 9.0% | +150 bps | Investment Banking Fee Breakdown (Q2 2025 vs Q2 2024) | Fee Type | Q2 2025 (M) | YoY Change | | :--- | :--- | :--- | | Advisory | $408 | +52% | | Equity Underwriting (ECM) | $218 | +25% | | Debt Underwriting (DCM) | $432 | -12% | | **Total** | **$1,058** | **+13%** | [Wealth](index=9&type=section&id=Wealth) The Wealth segment demonstrated strong momentum with revenues of $2.2 billion, up 20% year-over-year, driven by higher investment fees, leading to a significant RoTCE of 16.1% Wealth Q2 2025 Performance | Metric | Q2 2025 | YoY Change | | :--- | :--- | :--- | | **Total Revenues** | $2,166 M | +20% | | **Net Income** | $494 M | +135% | | **RoTCE** | 16.1% | +970 bps | - End-of-period client investment assets grew **17% year-over-year to $635 billion**, indicating strong client activity and market performance[30](index=30&type=chunk) [U.S. Personal Banking (USPB)](index=10&type=section&id=U.S.%20Personal%20Banking%20(USPB)) U.S. Personal Banking (USPB) generated revenues of $5.1 billion in Q2 2025, a 6% increase year-over-year, with net income surging to $649 million due to lower credit reserve builds USPB Q2 2025 Performance | Metric | Q2 2025 | YoY Change | | :--- | :--- | :--- | | **Total Revenues** | $5,119 M | +6% | | - Branded Cards | $2,822 M | +11% | | - Retail Services | $1,649 M | -5% | | - Retail Banking | $648 M | +16% | | **Net Income** | $649 M | +436% | | **RoTCE** | 11.1% | +920 bps | [USPB Metrics](index=11&type=section&id=USPB%20Metrics) Operational metrics for USPB show stable credit performance, with Branded Cards' Net Credit Loss rate at 3.80% and mortgage originations increasing significantly USPB Credit Card Metrics (Q2 2025) | Metric | Branded Cards | Retail Services | | :--- | :--- | :--- | | **New Account Acquisitions (k)** | 1,194 | 2,061 | | **Spend Volume (B)** | $135.8 | $22.9 | | **NCLs as % of avg. loans** | 3.80% | 5.89% | | **90+ days past due as % of EOP loans** | 1.09% | 2.15% | - Mortgage originations showed a strong rebound, increasing **68% sequentially** and **9% year-over-year to $4.7 billion**[39](index=39&type=chunk) [All Other](index=12&type=section&id=All%20Other) The 'All Other' category reported a managed basis loss from continuing operations of $588 million in Q2 2025, a combination of Legacy Franchises and Corporate/Other expenses All Other (Managed Basis) Q2 2025 Performance | Item | Q2 2025 (M) | YoY Change | | :--- | :--- | :--- | | Total Revenues, net | $1,698 | -14% | | Total Operating Expenses | $2,276 | +8% | | **Loss from Cont. Ops** | **($588)** | **-43% (less loss)** | [Legacy Franchises](index=13&type=section&id=Legacy%20Franchises) Legacy Franchises generated net income of $60 million in Q2 2025, a turnaround from a prior-year loss, with ongoing wind-down of Asia Consumer and growth in Banamex - Legacy Franchises reported net income of **$60 million** in Q2 2025, compared to a net loss of **$58 million** in Q2 2024[45](index=45&type=chunk) Legacy Franchises Key Indicators (EOP, vs Q2 2024) | Indicator | Banamex | Asia Consumer | | :--- | :--- | :--- | | **EOP Loans (B)** | $26.8 (+9%) | $3.0 (-46%) | | **EOP Deposits (B)** | $38.4 (+2%) | $1.5 (-82%) | [Corporate/Other](index=14&type=section&id=Corporate%2FOther) Corporate/Other reported a net loss of $627 million in Q2 2025, driven by a 78% year-over-year increase in operating expenses for unallocated costs and treasury activities Corporate/Other Q2 2025 Performance | Item | Q2 2025 (M) | Q2 2024 (M) | | :--- | :--- | :--- | | Total Revenues, net | $7 | $253 | | Total Operating Expenses | $989 | $556 | | **Net Loss** | **($627)** | **($344)** | [Reconciling Items—Divestiture-Related Impacts](index=15&type=section&id=Reconciling%20Items%E2%80%94Divestiture-Related%20Impacts) Divestiture-related impacts resulted in a net loss of $180 million in Q2 2025, primarily due to a pre-tax loss on the Poland consumer banking business sale and Mexico separation costs - Q2 2025 includes a loss of approximately **$186 million** related to the sale of the Poland consumer banking business and **$37 million** in operating expenses for separation costs in Mexico[54](index=54&type=chunk) Divestiture-Related Impacts | Item | Q2 2025 (M) | | :--- | :--- | | Total Revenues, net | ($177) | | Total Operating Expenses | $37 | | **Net Loss** | **($180)** | [Citigroup Supplemental Detail](index=16&type=section&id=Citigroup%20Supplemental%20Detail) [Average Balances and Interest Rates](index=16&type=section&id=Average%20Balances%20and%20Interest%20Rates) For Q2 2025, Citigroup's average interest-earning assets grew to $2.43 trillion, with Net Interest Margin improving to 2.51% due to a favorable rate environment Q2 2025 Average Balances and NIM | Metric | Q2 2025 | | :--- | :--- | | **Average Interest-Earning Assets** | $2,425.3 B | | **Average Interest-Bearing Liabilities** | $1,987.7 B | | **Net Interest Income (Taxable Equiv.)** | $15,203 M | | **Net Interest Margin (NIM)** | 2.51% | [EOP Loans](index=17&type=section&id=EOP%20Loans) Total end-of-period (EOP) loans reached $725.3 billion as of June 30, 2025, up 5% year-over-year, driven by growth in both corporate and consumer portfolios EOP Loans Breakdown (June 30, 2025) | Loan Category | Amount (B) | YoY Change | | :--- | :--- | :--- | | **Corporate Loans** | $329.6 | +9% | | - Services | $96.4 | +8% | | - Markets | $144.3 | +21% | | - Banking | $81.9 | -6% | | **Consumer Loans** | $395.8 | +2% | | - USPB | $220.2 | +5% | | - Wealth | $150.7 | 0% | | **Total Loans** | **$725.3** | **+5%** | [EOP Deposits](index=18&type=section&id=EOP%20Deposits) Total end-of-period (EOP) deposits were $1.36 trillion as of June 30, 2025, a 6% increase year-over-year, primarily driven by institutional businesses EOP Deposits Breakdown (June 30, 2025) | Segment | Amount (B) | YoY Change | | :--- | :--- | :--- | | Services, Markets, and Banking | $891.6 | +10% | | Wealth | $309.9 | -3% | | USPB | $90.5 | +5% | | All Other | $65.7 | -2% | | **Total Deposits** | **$1,357.7** | **+6%** | [Allowance for Credit Losses (ACL) Rollforward](index=19&type=section&id=Allowance%20for%20Credit%20Losses%20(ACL)%20Rollforward) The total Allowance for Credit Losses (ACLL and ACLUC) ended Q2 2025 at $20.8 billion, with a net reserve build of $345 million for loans, primarily in the corporate portfolio ACLL Rollforward YTD 2025 (in millions) | Category | Balance 12/31/24 | Net Build/(Release) YTD | Balance 6/30/25 | | :--- | :--- | :--- | :--- | | Corporate ACLL | $2,556 | $413 | $3,023 | | Consumer ACLL | $16,018 | ($68) | $16,100 | | **Total ACLL** | **$18,574** | **$345** | **$19,123** | - The total allowance for credit losses on loans (ACLL) as a percentage of end-of-period loans was **2.67%** at the end of Q2 2025[74](index=74&type=chunk) - The Q2 2025 rollforward includes a transfer of approximately **$25 million** in ACLL to Other Assets related to the agreement to sell the Poland consumer banking business[78](index=78&type=chunk) [Non-Accrual Assets](index=22&type=section&id=Non-Accrual%20Assets) Total non-accrual loans (NALs) increased to $3.35 billion at the end of Q2 2025, up 49% year-over-year, representing 0.46% of total loans Non-Accrual Loans (June 30, 2025) | Category | Amount (M) | YoY Change | | :--- | :--- | :--- | | Corporate NALs | $1,722 | +73% | | Consumer NALs | $1,632 | +30% | | **Total NALs** | **$3,354** | **+49%** | - Non-accrual loans as a percentage of total loans stood at **0.46%**, an increase of **13 basis points** from Q2 2024[79](index=79&type=chunk) [Capital Ratios and Shareholder Metrics](index=23&type=section&id=CET1%20Capital%20and%20Supplementary%20Leverage%20Ratios%2C%20Tangible%20Common%20Equity%2C%20Book%20Value%20Per%20Share%20and%20Tangible%20Book%20Value%20Per%20Share) As of June 30, 2025, Citigroup maintained a strong capital position with a preliminary CET1 Capital ratio of 13.5% and SLR of 5.5%, with TBVPS increasing to $94.16 Key Capital and Value Metrics (June 30, 2025) | Metric | Value | | :--- | :--- | | **CET1 Capital Ratio** | 13.5% | | **Supplementary Leverage Ratio (SLR)** | 5.5% | | **Book Value per Share** | $106.94 | | **Tangible Book Value per Share (TBVPS)** | $94.16 | - Tangible Common Equity (TCE) increased to **$173.3 billion** from **$167.0 billion** a year ago, while common shares outstanding decreased by **4%** to **1,840.9 million** due to share repurchases[82](index=82&type=chunk)