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Michael Corbat, CEO of Citigroup, signed his final year at the helm of the US bank with a 40% drop in profits, describing 2020 as a “tumultuous” 12-month year.
The bank posted profits of $ 11.4 billion in 2020, as the strong results for the investment bank were offset by a difficult year for its consumer unit. Revenue of $ 74.3 billion was broadly stable from 2019.
Corbat, who is expected to hand the reins to Jane Fraser next month, said: “We ended a tumultuous year with a strong fourth quarter. As a sign of the strength and durability of our diversified franchise, our revenues remained stable until 2019, despite the massive economic impact of Covid-19. “
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Citi’s institutional client group, which includes its investment bank, reported 2020 revenue of $ 44.3 billion, a 13% increase from the previous year.
Major investment banks have benefited from huge increases in their sales and trading income throughout the Covid-19 crisis, which has increased market volatility. Citi made $ 23 billion in its securities markets and services unit, up 29% from the same period last year, but less than rival JPMorgan which posted a 34% increase.
Fixed income trading was a particular highlight for investment banks in 2020. Citigroup reported $ 17.3 billion in revenue in this unit, an increase of 34% from the previous year.
At the same time, its equities division – which is shaken by Fater Belbachir who took the reins in August – increased its revenues by 25% to $ 3.6 billion. Revenue jumped 57% to $ 810 million in the last three months of the year, while fixed-income income slowed – the $ 3.1 billion made in the fourth quarter was only up by 7% compared to the previous year.
Traditional investment banking units have also performed well throughout the pandemic and, along with sales and trading income, have helped offset struggling consumer divisions that have been weighed down by billions in provisions for doubtful debts.
Citigroup finished fifth in the revenue rankings, according to data provider Dealogic, as investment banks posted a record $ 91.8 billion in 2020. Citi’s investment bank posted a gain of 11 % for the year to $ 5.8 billion.
To contact the author of this story with comments or news, email Paul Clarke
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