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Citigroup Shares jumped Wednesday after fourth-quarter earnings beat estimates on both the top and bottom lines, reflecting broad-based strength across the bank.
“2024 was a critical year and our results show that our strategy is delivering as intended and driving stronger performance in our businesses. Our net income grew by almost 40% to $12.7 billion and we exceeded our full-year revenue targets, including record years in Services, Wealth and US Personal Banking,” CEO Jane Fraser said in a press release.
The company’s shares rose 6%.
Here’s how the company did relative to LSEG analyst consensus estimates:
- Earnings: $1.34 per share versus $1.22 expected
- Revenue: $19.58 billion vs $19.49 billion expected
Citi posted net income of $2.86 billion, an improvement from a net loss of $1.84 billion a year ago, when its results were hurt by a number of Citi charges reserved in the final period of 2023.
The bank said it expects its return on tangible common equity to be between 10% and 11% in 2026, as it continues to make investments and restructure its business. That range is below the bank’s medium-term target of 11% to 12%.
“This level is a waypoint, not a destination. We intend to improve returns well above that level and deliver Citi’s potential for our shareholders,” Fraser said.
Citi also announced a $20 billion stock buyback.
The bank reported growth in several different business units during the fourth quarter. Investment banking in particular was a bright spot, with revenues jumping 35% year over year to $925 million. Citi said continued momentum in the issuance of investment-grade corporate debt helped boost that area of the business. As a result, total banking revenues grew by 12%, which expanded to 27% when including the impact of loan hedges.
Markets revenue jumped 36% year over year to $4.58 billion, with fixed income and equity businesses growing. Fixed income markets revenue of $3.48 billion was well above the $2.95 billion expected by analysts, according to StreetAccount.
Revenues for the wealth and services units rose 20% and 15%, respectively, year over year.
Citi’s cost of credit for the quarter was $2.59 billion. That’s down from $3.55 billion a year ago, and $2.68 billion in the third quarter. The bank added a net $203 million to its allowance for credit losses, which was also down from previous periods.
On the analyst call later Wednesday, investors will be looking for progress updates on Fraser’s turnaround efforts. Fraser took over the bank in March 2021 and focused on slimming the company, including the sale of some international units.
Citi stock has been a strong performer in 2024, rising nearly 37% on the year. The stock was up more than 4% so far this year entering Wednesday.
