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Citigroup surpassed analysts' expectations in terms of earnings and revenue thanks to gains from the initial public offering of the Tradeweb electronic bond trading platform.
The bank made a profit of $ 4.79 billion, or $ 1.95 per share, against an estimate of $ 1.80 analysts surveyed by Refinitiv. Excluding the impact of the IPO, the bank would have recorded a profit of 1.83 USD per share, fueled by a reduction in taxes and a reduction in the number of shares outstanding.
While earnings per share jumped 20% in the quarter, the company's revenue growth was more moderate in the face of declines in brokerage and investment banking revenues and losses on hedges. loans, said the bank. Revenues rose 2% to $ 18.76 billion, exceeding the $ 18.5 billion estimate, generated by a $ 350 million pre-tax gain on Tradeweb's IPO, said the company. bank.
"We managed to navigate an uncertain environment by executing our strategy and disciplined spending, credit and risk management," said CEO Michael Corbat in a statement.
Citigroup is the first major US bank to release its results for the second quarter. Investors want to know the evolution of its banking and trading during the period.
Last month, CFO Mark Mason said at a conference that trading revenue in the quarter would likely decrease by a "less than 25 percent" percentage per year. compared to a year ago. Investors will also want to know if the bank has been able to reduce expenses while increasing its revenues and the lender's sprawling results outside the US during the quarter.
The shares of the New York bank have soared 38% so far this year, compared to the 16% gain in the KBW Bank index.
The other banks are also expected to benefit from the IPO of Tradeweb, which was among the largest US banks, including Goldman Sachs and Bank of America, among investors. Tradeweb, founded in 1996, was released in April during the second IPO of the year on that date.
This is what Wall Street was waiting for:
- Earnings: $ 1.80 per share, up 11% from a year ago, according to Refinitiv
- Turnover: $ 18.5 billion, almost unchanged from the previous year.
- Trading revenue: fixed revenues: $ 2.98 billion, shares: $ 811 million, according to Factset
- Efficiency ratio: 57.3 according to Factset
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