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Citigroup reported earnings of $ 2.85 per share for the most recent quarter.
Mario Tama / Getty Images
Citigroup‘s
second quarter results exceeded Wall Street expectations, giving investors reason to hope for a turnaround under Jane Fraser’s leadership.
Citigroup (ticker: C) posted a profit of $ 6.2 billion, or $ 2.85 per share, on revenue of $ 17.5 billion. Analysts polled by FactSet expected earnings of $ 1.97 per share on revenue of $ 17.2 billion. In the quarter of last year, the bank earned $ 1.06 billion, or 38 cents per share, on $ 19.8 billion in revenue, as it set aside nearly $ 6 billion of reserves in anticipation of a wave of defaults due to the coronavirus pandemic. Instead, this quarter the bank released $ 2.4 billion in reserves as economic conditions improved.
Citigroup stock rose 1.6% in pre-release.
Fraser noted the faster-than-expected pace of the global economic recovery, coupled with growing consumer and business confidence when examining the bank’s results.
“While we need to be aware of the uneven global recovery, we are optimistic about the momentum ahead,” Fraser said.
Like other banks that released results earlier this week, Citigroup saw its revenues decline due to a decline in trading activity. The bank’s trading division’s total revenue fell 30% year-over-year, with a 43% decline in fixed income trading and a 37% increase in trading on actions.
Citigroup’s consumer banking unit saw a 10% drop in revenue, reflecting lower card balances and deposit spreads. This unit also saw a 7% increase in spending.
In addition to Citigroup’s results, investors are paying close attention to the bank’s efforts to improve operations after receiving a consent order last year for weak internal controls.
Citigroup is one of the last major banks to release results this week following reports from
JPMorgan Chase
(JPM) and
Goldman Sachs
(GS) Tuesday.
Bank of America
(BAC) and
Wells fargo
(WFC) also reported the results on Wednesday.
Morgan Stanley (United States)
reported the results Thursday.
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