Citigroup Q3 Earnings Beat Estimates, IB Revenues Increase 31% Y/Y

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$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$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$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$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$1.31 trillion, while loans increased marginally to $689 billion [5] - Total non-accrual loans fell by 34$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$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]