New York — Citigroup posted a 7% rise in quarterly
profit, wrapping up a strong quarter for big US banks with trade in
bonds and currencies surging after the November election.
Other banks reporting results were Goldman Sachs and JPMorgan Chase.
Citi’s net income rose to $3.57bn ($1.14 a share) in the December quarter from $3.34bn ($1.02) in the previous fourth quarter, beating the average analyst estimate of $1.12 a share, according to Thomson Reuters I/B/E/S.
Citigroup revenue from fixed-income trade rose about 36% and equity trading revenue about 15%, pushing up total markets and securities services revenue about 24% higher than in the previous matching quarter.
"We had a strong finish to 2016, bringing momentum into this year," said CE Michael Corbat. "We drove revenue growth in our businesses and demonstrated strong expense discipline across the firm."
However, adjusted revenue fell 9% to $17.01bn on divestitures, versus the average estimate of $17.30bn.
Wall Street trading desks benefited in the quarter from higher volume and volatility in stocks, bonds and currencies after Donald Trump’s shock victory.
Goldman Sachs posted a 78% leap in revenue from trading fixed-income securities, currencies and commodities earlier on Wednesday.
JPMorgan Chase, the No 1 US bank by assets, and Morgan Stanley also reported sharp rises in fourth-quarter fixed-income trading revenue.
Adjusted revenue from Citicorp, Citigroup’s ongoing businesses, rose 6% to $16.36bn. Citicorp’s expenses fell 2% to $9.46bn.
Citigroup’s share price was were little changed in premarket trade, having risen 17% since the election.
Shares of US banks have staged a dramatic rally following Trump’s victory as investors expect banks to reap huge benefits from lighter regulation under his presidency.
The Federal Reserve, which raised interest rates by 0.25 percentage points in December, is expected to raise them three times this year. That will also help banks.
Citigroup said adjusted return on tangible common equity, a key measure of profitability, was unchanged at 7.1%. Corbat set a target of 10% return on equity by 2015 shortly after taking the reins in 2012.
Total operating expenses fell 9% to $10.12bn.
Citigroup, which has more assets in emerging markets than other US banks, has been quitting less profitable operations in markets globally, consolidating back offices and cutting jobs to be more efficient.
Reuters/BDlive
Other banks reporting results were Goldman Sachs and JPMorgan Chase.
Citi’s net income rose to $3.57bn ($1.14 a share) in the December quarter from $3.34bn ($1.02) in the previous fourth quarter, beating the average analyst estimate of $1.12 a share, according to Thomson Reuters I/B/E/S.
Citigroup revenue from fixed-income trade rose about 36% and equity trading revenue about 15%, pushing up total markets and securities services revenue about 24% higher than in the previous matching quarter.
"We had a strong finish to 2016, bringing momentum into this year," said CE Michael Corbat. "We drove revenue growth in our businesses and demonstrated strong expense discipline across the firm."
However, adjusted revenue fell 9% to $17.01bn on divestitures, versus the average estimate of $17.30bn.
Wall Street trading desks benefited in the quarter from higher volume and volatility in stocks, bonds and currencies after Donald Trump’s shock victory.
Goldman Sachs posted a 78% leap in revenue from trading fixed-income securities, currencies and commodities earlier on Wednesday.
JPMorgan Chase, the No 1 US bank by assets, and Morgan Stanley also reported sharp rises in fourth-quarter fixed-income trading revenue.
Adjusted revenue from Citicorp, Citigroup’s ongoing businesses, rose 6% to $16.36bn. Citicorp’s expenses fell 2% to $9.46bn.
Citigroup’s share price was were little changed in premarket trade, having risen 17% since the election.
Shares of US banks have staged a dramatic rally following Trump’s victory as investors expect banks to reap huge benefits from lighter regulation under his presidency.
The Federal Reserve, which raised interest rates by 0.25 percentage points in December, is expected to raise them three times this year. That will also help banks.
Citigroup said adjusted return on tangible common equity, a key measure of profitability, was unchanged at 7.1%. Corbat set a target of 10% return on equity by 2015 shortly after taking the reins in 2012.
Total operating expenses fell 9% to $10.12bn.
Citigroup, which has more assets in emerging markets than other US banks, has been quitting less profitable operations in markets globally, consolidating back offices and cutting jobs to be more efficient.
Reuters/BDlive
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