HALISTER: Citigroup 2Q EPS, Trading, Investment Banking Revenues Beat Ests

Citigroup 2Q EPS, Trading, Investment Banking Revenues Beat Ests

(Bloomberg) -- Citigroup 2Q EPS $1.24, no adjustments, est. $1.10.
  • 2Q adj. rev. $17.5b, est. $17.5b
  • NIM 2.86% vs 2.92% q/q as reported in 1Q statement in April
  • Grew loans in consumer and institutional businesses; cut expenses; “significantly” improved efficiency ratio, ROA, ROTCE q/q: CEO Mike Corbat
    • Nearly all net income came from core businesses; still reducing non-core assets in Citi Holdings
    • Utilized deferred tax assets (~$900m); “fuels” ability to generate regulatory capital
  • 2Q fixed income trading rev. $3.47b vs est. $3.14b (Bloomberg survey of 6 ests.)
    • Equities markets trading rev. $788m vs est. $707.5m (Bloomberg survey of 6 ests.)
  • I-banking rev. $1.22b vs est. $972.5m (Bloomberg survey of 5 ests.)
  • 2Q expenses $10.37b vs $10.52b q/q
  • 2Q credit reserve release $256m vs build of $233m q/q
  • Allowance for loan losses $12.3b at qtr end, 1.96% of total loans, vs $14.1b (2.25% of total) y/y
  • Loans $634b at qtr end, little changed y/y (up 2% constant dollars)
  • Citi Holdings rev. down 57% y/y on continued reductions in assets, lower gains on asset sales
  • Tier 1 common ratio 12.5% vs 12.3% q/q
    • SLR 7.5% vs 7.4%
  • Return on avg. common equity 7.0% vs 6.4% q/q
  • Bought back 30m shrs
  • To follow our TOPLive blog for real-time news, analysis on C earnings starting at 8am
  • Call 11:30am, 866-516-9582 pw 98883113
  • PREVIEW BANKS 2Q: JPMorgan Read-Through Good for Citi, Wells
Statement {NSN OACUMCMEWG74 }
Alert: HALISTER
Source: BFW (Bloomberg First Word)

Tickers
C US (Citigroup Inc)

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Mike Corbat (Citigroup Global Markets Inc)

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HALISTER1: JPMorgan Sees BOE Cutting Rates to Zero in Aug. vs 0.25% Prior

JPMorgan Sees BOE Cutting Rates to Zero in Aug. vs 0.25% Prior

(Bloomberg) -- Expect BOE to cut rates by 50bps at August meeting vs 25bps previously after Chief Economist Haldane said he will probably push for stimulus next month, JPMorgan analyst Allan Monks writes in client note.
  • Continue to expect a GBP75b increase in sovereign QE and the announcement of some credit easing measures, possibly an extension of the FLS program or some corporate bond purchases
  • NOTE: BOE to cut rates in August and November, JPMorgan said Thursday
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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Allan Monks (JP Morgan Chase)

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UUID: 7947283

HALISTER1: BOE to Cut Rate by 40 BPs in August, QE to Start in November: MS

BOE to Cut Rate by 40 BPs in August, QE to Start in November: MS

(Bloomberg) -- BOE meeting was less dovish than expected, with only Vlieghe voting for a rate cut and only “most” -- not all -- members of the committee expecting policy to be loosened in August, Morgan Stanley economists including Melanie Baker write in a client note.
  • Expect BOE to bring rate down to 0.10%; central bank likely see this as the lower bound and signal QE of GBP50b to start in Nov.
  • Had earlier expected unanimous 25 bps rate cut to 0.25%
  • Further easing will follow; committee discussed a “package” of measures, suggests at least rate cuts and QE
  • MPC has been clear on the hierarchy of easing:
    • First rate cuts, seen as marginal instrument of policy; second QE, which they say is an effective policy instrument
    • May also consider some creative options such as funding for lending scheme, or purchasing some assets on a smaller scale (as seen in corporate bonds previously)
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Melanie Baker (Morgan Stanley)

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UUID: 7947283

HALISTER1: Turkish Minister Rejects Money Laundering Criticism on Tax Draft

Turkish Minister Rejects Money Laundering Criticism on Tax Draft

(Bloomberg) -- No investigation will be opened against Turkish citizens who bring their cash from abroad to Turkey, Finance Minister Naci Agbal tells reporters in Ankara, defending planned tax incentives bill to attract cash.
  • Immunity from probes related to “just the act of bringing the money” to Turkey, doesn’t mean protection of illicit cash
  • Govt open to “all suggestions” on bill, which will be sent to parliament commission
  • Turkey should benefit from abundance of cash globally that’s “seeking a place to park”
  • Cash brought from abroad will be free to leave whenever its owner wants, without need for govt approval
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Naci Agbal (Republic of Turkey)

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UUID: 7947283

HALISTER1: Germany, France Pushing Against Terror Financing: Schaeuble

Germany, France Pushing Against Terror Financing: Schaeuble

(Bloomberg) -- German Finance Minister Wolfgang Schaeuble says he and his French counterpart Michel Sapin will keep pushing for tougher money-laundering rules to combat terror financing, according to an interview with German public broadcaster BR.
  • Schaeuble reacts to truck attack in Nice, France, in radio interview
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Michel Sapin (French Republic)
Wolfgang Schaeuble (Federal Republic of Germany)

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HALISTER: *KKR, APOLLO-BACKED VENTURE SAID TO WEIGH INDIA STEELMAKER DEALS

*KKR, APOLLO-BACKED VENTURE SAID TO WEIGH INDIA STEELMAKER DEALS

--TIMOTHY SIFERT
Alert: HALISTER
Source: BFW (Bloomberg First Word)

Tickers
KKR US (KKR & Co LP)
APO US (Apollo Global Management LLC)
0965338D IN (AION Capital Partners Ltd)
MT NA (ArcelorMittal)
BHUS IN (Bhushan Steel Ltd)

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Lakshmi Mittal (ArcelorMittal)

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UUID: 7947283