Citigroup Reports Better-Than-Expected Profit
By David Benoit
Citigroup Inc. on Friday said its fourth-quarter income fell 7%
and it drew down some of the reserves it set aside to cover
potentially soured loans.
The New York bank said profit fell to $4.63 billion, or $2.08
per share, compared with $4.98 billion, or $2.15 per share, a year
earlier. Still, that beat the $1.34 expected by analysts polled by
Revenue fell 10% to $16.5 billion, falling short of the $16.72
billion analysts expected.
For all of 2020, a year of upheaval in the economy, profit at
the nation's third-biggest bank by assets fell 41% to $11.37
billion and revenue was flat at $74.3 billion. Like its big bank
peers, Citigroup enjoyed strong results from its Wall Street
operations, but that was offset by the billions of dollars the bank
had to put aside for potentially bad loans.
In a sign its outlook on the economy has improved, Citigroup
drew down $1.5 billion of the reserves the bank had put aside for
future loan losses, a big reason the bank's profit was better than
It will be the last earnings day for Chief Executive Michael
Corbat, who is retiring in February after the bank finalizes its
2020 financial statements. He will be succeeded by bank president
Jane Fraser, who has led various divisions since joining Citigroup
in 2004 and recently ran the consumer bank.
Shares of Citigroup fell 23% in 2020, underperforming the
S&P 500's 16% increase and the KBW Nasdaq Bank Index, which
fell 14%. But in the first two weeks of 2021, bank stocks have been
lifted by hopes of an economic recovery spurred by vaccines and
potentially more government stimulus. Citigroup shares are up 12%
in the new year.
Write to David Benoit at email@example.com
(END) Dow Jones Newswires
January 15, 2021 08:45 ET (13:45 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.