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Citigroup (C) Q1 Earnings and Revenues Surpass Estimates
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Citigroup Inc.’s (C - Free Report) first-quarter 2022 earnings per share of $2.02 have handily outpaced the Zacks Consensus Estimate of $1.74. However, the reported figure declined 44% from the prior-year quarter.
After reporting better-than-expected earnings, shares of the company are up 1.2% in pre-market trading.
Starting first-quarter 2022, the company has removed its Global Consumer Banking segment. The new reporting structure differentiates four core businesses — the Institutional Client Group (“ICG”) segment, Personal Banking and Wealth Management, Legacy Franchises, and Corporate/Other.
Citigroup’s Treasury and Trade Solutions revenues improved, while Investment Banking revenues declined. A rise in deposit balance and book value per share were positives.
Net income was $4.3 billion, decreasing 46% from the prior-year quarter.
Revenues Fall, Expenses Flare Up
Revenues, net of interest expenses, fell 2% year over year to $19.19 billion in the March-end quarter. The top line, nonetheless, outpaced the Zacks Consensus Estimate of $18.07 billion. Lower revenues were recorded at the ICG, Personal Banking and Wealth Management, and Legacy Franchises segments.
In the ICG segment, total revenues, net of interest expenses, were $11.16 billion in the first quarter, down 2% year over year. A decline in Banking and Markets revenues was more than offset by a rise in Securities revenues.
The Personal Banking and Wealth Management segment’s revenues declined 1% year over year to $5.91 billion.
Legacy Franchises’ revenues of $1.93 billion declined 14% year over year.
Corporate/Other’s revenues were $190 million, improving from $44 million witnessed in the prior-year quarter.
Citigroup’s operating expenses rose 15% year over year to $13.16 billion.
Balance Sheet Position Decent
At the end of the first quarter, Citigroup’s deposits were up 1% from the prior quarter to $1.33 trillion. The company’s loans declined 1% to $660 billion.
Credit Quality Improved
Citigroup’s costs of credit for the March-end quarter were $775 million in first-quarter 2022 against a negative $2.1 billion recorded in the year-earlier quarter.
Nonetheless, total non-accrual assets declined 34% year over year. The company reported a fall of 36% in consumer non-accrual loans to $1.5 billion. Also, corporate non-accrual loans of $1.9 billion plunged 31%.
Citigroup’s total allowance for credit losses on loans was $15.4 billion at the end of the reported quarter compared with $21.6 billion in the year-ago period.
Capital Position Decent
As of Mar 31, 2022, book value per share was $92.03, up 4% year over year. Tangible book value per share was $79.03, up 5%.
However, at the end of the first quarter, Citigroup’s Common Equity Tier 1 capital ratio was 11.4 %, down from 11.6% in first-quarter 2021. Also, the company’s supplementary leverage ratio in the reported quarter was at 5.6%, down from 6.9%.
Capital Deployment
In the reported quarter, Citigroup returned $4 billion to shareholders in forms of common share dividends and repurchases.
Our Viewpoint
The company delivered decent results this time around.Advancing its strategy to exit the consumer banking business in 14 international markets, Citigroup signed nine deals to sell such businesses to simplify operations and expand institutional franchises in targeted regions. Net interest income is likely to be supported by the improving economy, going forward.
One can consider a strong brand like Citigroup to be a sound investment option for the long term, given its global footprint and strategic refresh efforts. Nevertheless, rising operating expenses are concerning.
Fifth Third Bancorp (FITB - Free Report) is slated to report first-quarter 2022 results on Apr 19.
Over the past 30 days, the Zacks Consensus Estimate for Fifth Third’s first-quarter earnings has moved 2.8% lower to 70 cents. This indicates a 24.7% decline from the prior-year quarter.
First Horizon National Corporation (FHN - Free Report) is slated to report first-quarter 2022 results on Apr 19.
Over the past 30 days, the Zacks Consensus Estimate for First Horizon’s Q1 earnings has moved 2.9% lower to 34 cents. This indicates a 33.3% decline from the prior-year quarter.
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Citigroup (C) Q1 Earnings and Revenues Surpass Estimates
Citigroup Inc.’s (C - Free Report) first-quarter 2022 earnings per share of $2.02 have handily outpaced the Zacks Consensus Estimate of $1.74. However, the reported figure declined 44% from the prior-year quarter.
After reporting better-than-expected earnings, shares of the company are up 1.2% in pre-market trading.
Starting first-quarter 2022, the company has removed its Global Consumer Banking segment. The new reporting structure differentiates four core businesses — the Institutional Client Group (“ICG”) segment, Personal Banking and Wealth Management, Legacy Franchises, and Corporate/Other.
Citigroup’s Treasury and Trade Solutions revenues improved, while Investment Banking revenues declined. A rise in deposit balance and book value per share were positives.
Net income was $4.3 billion, decreasing 46% from the prior-year quarter.
Revenues Fall, Expenses Flare Up
Revenues, net of interest expenses, fell 2% year over year to $19.19 billion in the March-end quarter. The top line, nonetheless, outpaced the Zacks Consensus Estimate of $18.07 billion. Lower revenues were recorded at the ICG, Personal Banking and Wealth Management, and Legacy Franchises segments.
In the ICG segment, total revenues, net of interest expenses, were $11.16 billion in the first quarter, down 2% year over year. A decline in Banking and Markets revenues was more than offset by a rise in Securities revenues.
The Personal Banking and Wealth Management segment’s revenues declined 1% year over year to $5.91 billion.
Legacy Franchises’ revenues of $1.93 billion declined 14% year over year.
Corporate/Other’s revenues were $190 million, improving from $44 million witnessed in the prior-year quarter.
Citigroup’s operating expenses rose 15% year over year to $13.16 billion.
Balance Sheet Position Decent
At the end of the first quarter, Citigroup’s deposits were up 1% from the prior quarter to $1.33 trillion. The company’s loans declined 1% to $660 billion.
Credit Quality Improved
Citigroup’s costs of credit for the March-end quarter were $775 million in first-quarter 2022 against a negative $2.1 billion recorded in the year-earlier quarter.
Nonetheless, total non-accrual assets declined 34% year over year. The company reported a fall of 36% in consumer non-accrual loans to $1.5 billion. Also, corporate non-accrual loans of $1.9 billion plunged 31%.
Citigroup’s total allowance for credit losses on loans was $15.4 billion at the end of the reported quarter compared with $21.6 billion in the year-ago period.
Capital Position Decent
As of Mar 31, 2022, book value per share was $92.03, up 4% year over year. Tangible book value per share was $79.03, up 5%.
However, at the end of the first quarter, Citigroup’s Common Equity Tier 1 capital ratio was 11.4 %, down from 11.6% in first-quarter 2021. Also, the company’s supplementary leverage ratio in the reported quarter was at 5.6%, down from 6.9%.
Capital Deployment
In the reported quarter, Citigroup returned $4 billion to shareholders in forms of common share dividends and repurchases.
Our Viewpoint
The company delivered decent results this time around.Advancing its strategy to exit the consumer banking business in 14 international markets, Citigroup signed nine deals to sell such businesses to simplify operations and expand institutional franchises in targeted regions. Net interest income is likely to be supported by the improving economy, going forward.
One can consider a strong brand like Citigroup to be a sound investment option for the long term, given its global footprint and strategic refresh efforts. Nevertheless, rising operating expenses are concerning.
Citigroup Inc. Price, Consensus and EPS Surprise
Citigroup Inc. price-consensus-eps-surprise-chart | Citigroup Inc. Quote
At present, Citigroup carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Release Dates of Other Companies
Fifth Third Bancorp (FITB - Free Report) is slated to report first-quarter 2022 results on Apr 19.
Over the past 30 days, the Zacks Consensus Estimate for Fifth Third’s first-quarter earnings has moved 2.8% lower to 70 cents. This indicates a 24.7% decline from the prior-year quarter.
First Horizon National Corporation (FHN - Free Report) is slated to report first-quarter 2022 results on Apr 19.
Over the past 30 days, the Zacks Consensus Estimate for First Horizon’s Q1 earnings has moved 2.9% lower to 34 cents. This indicates a 33.3% decline from the prior-year quarter.