Core Viewpoint - Citigroup Inc. reported a third-quarter 2024 adjusted net income per share of $1.51, exceeding the Zacks Consensus Estimate of $1.34, although it decreased 0.7% year-over-year [1] - The company experienced a 31% year-over-year increase in Investment Banking revenues, primarily driven by strong performance in Debt Capital Markets [1] Financial Performance - Revenues, net of interest expenses, increased by 1% year-over-year to $20.32 billion, surpassing the Zacks Consensus Estimate of $19.90 billion [2] - Net Interest Income (NII) fell by 3% year-over-year to $13.36 billion, while non-interest revenues (NIR) rose by 10% to $6.9 billion [2] - Operating expenses decreased by 2% year-over-year to $13.25 billion, attributed to organizational simplification and stranded cost reductions [2] Segmental Performance - Services segment revenues increased by 8% year-over-year to $5.02 billion, driven by growth in Securities Services and Treasury, and Trade Solutions [3] - Markets segment revenues rose by 1% year-over-year to $4.82 billion, supported by growth in Equity markets [3] - Banking revenues increased by 16% year-over-year to $1.59 billion, primarily due to growth in Investment Banking [3] - U.S. Personal Banking revenues were up 3% year-over-year to $5.05 billion, driven by higher net interest income from loan growth [3] Wealth and Other Segments - Wealth segment revenues rose by 9% year-over-year to $2 billion, driven by a 15% increase in non-interest revenues [4] - Revenues in the All Other segment declined by 18% year-over-year to $1.83 billion [4] Balance Sheet and Credit Quality - Total deposits increased by 2% quarter-over-quarter to $1.31 trillion, while loans increased marginally to $689 billion [5] - Total non-accrual loans fell by 34% year-over-year to $2.20 billion, but provisions for credit losses rose by 45% year-over-year to $2.67 billion [6][7] Capital Position and Deployment - Common Equity Tier 1 capital ratio was 13.7%, up from 13.6% in the prior year, while the supplementary leverage ratio decreased to 5.8% [8] - Citigroup returned $2.1 billion to shareholders through dividends and share repurchases in the reported quarter [9] 2024 Outlook - Management expects revenues of $80-$81 billion, driven by fee growth in the Services segment and a strong Investment Banking business [10] - Projected expenses are estimated to be between $53.5 billion and $53.8 billion, excluding special assessments [10] Overall Assessment - The third-quarter results reflect strength in loans and deposits, alongside lower expenses, with revenue growth driven by various segments, particularly Services and Banking [11] - Business transformation initiatives are expected to support long-term growth by focusing on profitable segments and eliminating non-viable ones [11]

Group 1 - The focus is on income investing through common shares, preferred shares, or bonds [1] - The author targets two articles per week for publication on Mondays and Tuesdays [1] - The author has a background in history/political science and an MBA with a specialization in Finance and Economics [1] Group 2 - The author has been investing since 2000 and is currently the CEO of an independent living retirement community in Illinois [1]

Group 1 - Citigroup's third-quarter profit fell due to increased credit losses and reserves for bad loans, leading to a decline in shares [1] - Net income decreased by 9% year-over-year to $3.24 billion, or $1.51 per share, although it exceeded analyst estimates [1] - Revenue, net of interest expense, rose by 1% to $20.32 billion, also surpassing expectations [1] Group 2 - The cost of credit increased to $2.7 billion from $1.8 billion in 2023, primarily driven by higher credit card losses and a rise in the allowance for credit losses, which grew to $22.1 billion from $20.2 billion [1] - Revenue growth was noted across all business segments except "all other," with the investment banking unit showing a significant 31% increase to $934 million [1] - CEO Jane Fraser emphasized that the results indicate the bank is moving in the right direction, with positive operating leverage, share gains, and fee growth [2]

Core Viewpoint - Citigroup reported a revenue of $20.32 billion for Q3 2024, showing a year-over-year increase of 0.9% and exceeding the Zacks Consensus Estimate by 2.05% [1] Financial Performance Metrics - Earnings per share (EPS) for the quarter was $1.51, slightly down from $1.52 a year ago, but surpassed the consensus estimate of $1.34 by 12.69% [1] - Book value per common share was $101.91, exceeding the average estimate of $100.80 [2] - Efficiency Ratio stood at 65.2%, better than the estimated 67.3% [2] - Net Interest Margin (FTE) was reported at 2.3%, slightly below the estimated 2.4% [2] - Average balance of total interest-earning assets was $2,282.12 billion, above the estimate of $2,276.26 billion [2] Revenue Breakdown - Markets Revenues, net of interest expense, reached $4.82 billion, surpassing the average estimate of $4.59 billion [2] - Equity Markets revenue was $1.24 billion, significantly higher than the estimated $983.36 million [2] - Fixed Income markets revenue totaled $3.58 billion, slightly below the estimate of $3.61 billion [2] - US Personal Banking Revenues, net of interest expense, were $5.05 billion, lower than the average estimate of $5.14 billion [2] - Services Revenues, net of interest expense, amounted to $5.03 billion, exceeding the estimate of $4.73 billion [2] - Corporate/ALL OTHER Revenues Managed Basis (net of interest expense) was $1.83 billion, below the average estimate of $2.13 billion [2] - Treasury and Trade Solutions revenue totaled $3.64 billion, above the estimate of $3.51 billion [2] - Securities Services revenue was $1.39 billion, higher than the estimated $1.22 billion [2] Stock Performance - Citigroup shares have returned +13.1% over the past month, outperforming the Zacks S&P 500 composite's +4.3% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Performance - Total revenues for Q3 2024 were $20,315 million, representing a 1% increase from Q2 2024 and a 1% increase from Q3 2023[2]. - Net income attributable to Citigroup for Q3 2024 was $3,273 million, a decrease of 1% from Q2 2024 and a decrease of 9% from Q3 2023[2]. - Diluted earnings per share for Q3 2024 were $1.51, a decrease of 1% from Q2 2024 and a decrease of 7% from Q3 2023[2]. - Total revenues for Q3 2023 were $34,837 million, with a net interest income (NII) of $13,828 million, reflecting a 1% increase in revenues from Q2 2024[4]. - Net income for Q3 2024 was $3,238 million, a 1% increase from Q3 2023[6]. - Nine months 2024 net revenues were $61,558 million, reflecting a 1% increase compared to the same period in 2023[6]. Credit Losses and Provisions - Net credit losses (NCLs) for Q3 2024 were $2,172 million, a decrease of 5% from Q2 2024 but an increase of 33% from Q3 2023[2]. - The provision for credit losses on loans was $1,816 million in Q3 2023, a 31% increase from the previous quarter[4]. - Total provisions for credit losses and benefits and claims were $1,840 million in Q3 2023, reflecting an 8% increase from the previous quarter[4]. - Net credit losses on loans were $1,637 million in Q3 2023, a 5% decrease from Q2 2024[4]. - Net credit losses on loans were $29 million in 2023, with a significant increase to $66 million in 2024, marking a 124% rise[9]. Operating Expenses - Total operating expenses for Q3 2024 were $13,250 million, reflecting a 1% decrease from Q2 2024 and a 2% decrease from Q3 2023[2]. - Operating expenses for Q3 2023 totaled $13,511 million, which is a 1% decrease from Q2 2024[4]. - Total operating expenses decreased by 1% from $1,225 million in 2023 to $1,179 million in 2024[9]. Assets and Liabilities - Total assets as of Q3 2024 were $2,430.7 billion, reflecting a 1% increase from Q2 2024[2]. - Total liabilities increased by 1% to $2,158,282 million, with long-term debt rising by 7% to $275,760 million[5]. - Total average interest-earning assets increased to $2,282,116 million in 3Q24, up from $2,256,924 million in 2Q24, reflecting a growth of approximately 1.1%[17]. Capital Ratios and Equity - Common Equity Tier 1 (CET1) Capital ratio for Q3 2024 was 13.7%, an increase from 13.59% in Q2 2024[2]. - Citigroup common stockholders' equity increased to $192,796 million as of September 30, 2024, up from $190,283 million in June 2024[27]. - Total Tier 1 Capital reached $175,788 million as of September 30, 2024, an increase from $173,783 million in June 2024[27]. - Book value per share increased to $101.91 as of September 30, 2024, compared to $99.70 in June 2024[27]. Revenue Segments - Services revenue for Q3 2024 was $5,028 million, up 7% compared to Q3 2023[6]. - Banking revenue increased by 16% year-over-year, reaching $1,597 million in Q3 2024[6]. - Wealth revenue saw a significant increase of 10%, totaling $2,002 million in Q3 2024[6]. - Total non-interest revenues for the nine months ended September 30, 2023, were $19,946 million, a 6% increase compared to the same period in 2022[4]. Efficiency and Profitability - The efficiency ratio improved to 54% in Q3, down from 57% in the previous quarter, maintaining a year-to-date efficiency ratio of 55%[7]. - The efficiency ratio improved from 89% in 2023 to 68% in 2024, indicating enhanced operational efficiency[9]. - Return on Tangible Common Equity (RoTCE) for Q3 was 23.1%, up from 13.6% in the previous quarter, with a year-to-date RoTCE of 22.4%[7]. Deposits and Loans - Total deposits for Q3 2024 were $1,310.0 billion, a 2% increase from Q2 2024[2]. - Total loans for Q3 2024 were $688.9 billion, remaining stable compared to Q2 2024[2]. - Total consumer loans increased by 3% year-over-year, reaching $389.2 billion in Q3 2024[18]. - Average loans by reporting unit remained stable at $83 billion, with a slight increase of 6% compared to the previous quarter[7]. Non-Performing Loans - Non-Performing Loans (NCLs) as a percentage of total average loans improved by 28 basis points year-over-year, standing at 1.26% in Q3 2024[18]. - The allowance for credit losses on loans (ACLL) as a percentage of NAL was 538%, indicating a strong coverage ratio[25]. - The company reported a significant decrease in non-accrual loans from the previous year, with a 52% reduction in total non-accrual loans[25].

分组1 - Citigroup reported quarterly earnings of $1.51 per share, exceeding the Zacks Consensus Estimate of $1.34 per share, and showing a slight decrease from $1.52 per share a year ago, adjusted for nonrecurring items [1] - The company achieved a revenue of $20.32 billion for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 2.05%, and an increase from $20.14 billion year-over-year [1] - Citigroup has consistently surpassed consensus EPS estimates in the last four quarters, achieving an earnings surprise of 12.69% this quarter [1][3] 分组2 - The stock has gained approximately 28.3% since the beginning of the year, outperforming the S&P 500's gain of 22.9% [2] - The current consensus EPS estimate for the upcoming quarter is $1.29 on revenues of $19.56 billion, and for the current fiscal year, it is $5.75 on revenues of $80.68 billion [4] - The Zacks Industry Rank for Banks - Major Regional is in the top 25% of over 250 Zacks industries, indicating a favorable outlook for the sector [5]

Core Viewpoint - Citigroup is expected to report its third-quarter earnings, providing insights into CEO Jane Fraser's turnaround strategy, with analysts projecting earnings per share of $1.31 and revenue of $19.84 billion [1] Group 1: Earnings Expectations - Analysts anticipate earnings per share of $1.31 for the third quarter [1] - Projected revenue for the quarter is $19.84 billion [1] Group 2: Management and Strategy - CEO Jane Fraser has been focused on streamlining Citigroup since taking over in March 2021, which includes reducing the bank's global footprint and workforce [1] Group 3: Performance Highlights - Investment banking and equities trading were noted as strong areas for Citigroup in the second quarter [1] - Citigroup's shares have increased by over 28% year-to-date, outperforming both the S&P 500 and the financial sector [1]

All Eyes Will Be on the Evolution of Banks’ Net Interest Income (NII)While both JPMorgan and Wells Fargo recently exceeded market expectations in their earnings reports, they are facing profit declines and ongoing pressure on Net Interest Income (NII) due to recent Federal Reserve rate cuts and a loosening of monetary policy. With more banking giants set to release their results this week, the evolution of NII will be a key focus for traders assessing which banks are better positioned to navigate this “post ...

Citigroup Lawsuit - Citigroup Inc (C) lawyers requested a US District Judge to dismiss a lawsuit filed by New York Attorney General Letitia James, which accuses Citibank of failing to reimburse customers for online scams [1] - The lawsuit, initiated in January 2024, claims Citibank's inadequate security measures allowed scammers to easily infiltrate customer accounts and steal deposits through unauthorized wire transfers, resulting in millions of dollars in losses for customers [2] - Citigroup argued it has strong procedures to protect customers from fraudulent transfers and follows all laws and regulations related to wire transfers, urging the court to dismiss the lawsuit based on the Uniform Commercial Code, which allows exceptions for banks with commercially reasonable security measures [3] Federal Reserve Enforcement Action - On October 1, 2024, the Federal Reserve terminated a decade-long enforcement action against Citigroup related to weaknesses in its anti-money laundering (AML) practices, which was initially raised in March 2023 by the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency [4] - The enforcement action, which did not include any fines, was filed against Citigroup and its subsidiaries Banamex and Citibank N A over concerns about compliance with AML regulations and the Bank Secrecy Act [4] Legal Troubles in Finance Industry - In October 2024, TD Securities USA, the US broker-dealer unit of The Toronto-Dominion Bank (TD), agreed to pay over $20 million in a settlement with US authorities over allegations of manipulating the US Treasuries market through spoofing between April 2018 and May 2019 [5] - Wells Fargo & Company (WFC) faced a class-action lawsuit in September 2024, accused of underpaying interest to clients in its cash sweep program, leading to substantial financial losses for clients while the company profited significantly from these funds [5]

Group 1 - Citi has launched its Token Services for Cash program, which processes multimillion-dollar transactions and provides 24/7 cross-border liquidity and payments between participating branches [1] - The service utilizes a private and permissioned blockchain owned and managed by Citi, eliminating the need for clients to hold or manage tokens [1] - The implementation of distributed ledger technology (DLT) and smart contracts aims to reduce costs and streamline processes for institutional clients [1] Group 2 - Citi's Token Services for Trade has successfully completed pilot transactions with shipping agents, marking its first real-world application in global shipping [2] - The service replaces traditional trade finance instruments like guarantees and letters of credit with smart contracts backed by tokenized cash, facilitating real-time transactions [2] - Traditional cross-border payment systems often incur high fees, with consumer payments averaging over 11%, which can diminish the value of smaller transactions [2] Group 3 - B2B payments face average fees of 1.5% and processing delays of several weeks, with nearly half of Citibank's corporate clients citing high costs as a significant issue [3] - Blockchain technology addresses these inefficiencies by enabling direct transactions without intermediaries, potentially completing transactions in seconds instead of days [3] - Research indicates that permissioned decentralized finance (DeFi) could reduce transaction costs by up to 80% compared to traditional methods [3]