HALISTER: Citigroup 3Q Adj. EPS, Rev., FICC Trading Beat Ests.

Citigroup 3Q Adj. EPS, Rev., FICC Trading Beat Ests.

(Bloomberg) -- Citigroup 3Q adj. EPS $1.24, est. $1.15.
  • 3Q adj. rev. $17.8b, est. $17.3b
  • Remains “intensely focused” on shareholder returns; cites Costco portfolio buy, sales of retail operations in Argentina, Brazil as examples of shift in resources to areas likely to generate best returns: CEO Michael Corbat
    • Grew core loans, deposits while cutting non-core assets to 3% of balance sheet
  • 3Q fixed income trading rev. $3.47b vs est. $2.95b (Bloomberg survey of 7 ests.)
    • Equities trading rev. $663m vs est. $785.6m (Bloomberg survey of 7 ests.)
  • 3Q i-banking rev. $1.09b vs est. $1.06b (Bloomberg survey of 6 ests.)
  • 3Q NIM 2.86% vs 2.86% reported in 2Q statement
  • 3Q expenses $10.40b vs $10.37b q/q
  • 3Q credit reserve build $176m vs release $256m q/q
  • Allowance for loan losses $12.4b at qtr end, 1.97% of total loans, vs $12.3b (1.96% of total) reported in 2Q release, $13.6b (2.21% of total) y/y
  • Loans $638b at qtr end vs $634b reported in 2Q release
    • Up 2% y/y (up 3% in constant dollars); Citicorp loans up 7% in constant dollars; partially offset by drop in Citi Holdings (driven by reductions in North America mortgage portfolio)
  • Citicorp total rev. $16.88b vs $16.71b q/q
    • Expenses $9.58b vs $9.51b q/q
    • Credit reserve build $298m vs release $27m q/q
    • Consumer loans 90+ days delinquent up 9% to $2.2b, driven by portfolio growth, “normal” portfolio seasoning; ratio 0.75% vs 0.74% y/y
  • Global consumer banking (GCB) rev. $8.23b, up 1% y/y, (up 3% constant dollars, driven by 7% increase in North America)
    • Citi-branded cards rev. up 15% to $2.2b on Costco add, “modest” organic growth
    • North America oper expenses up 12% to $2.6b on Costco add, vol. growth, marketing
  • Citi Holdings rev. down 48% y/y to $877m on continued reductions in assets
  • Tier 1 common ratio 12.6% vs 12.5% q/q
    • SLR 7.4% vs 7.5%
  • Return on avg. common equity 6.8% vs 7.0% q/q
  • BV/shr $74.51 vs $73.19 q/q; TBV/shr $64.71 vs $63.53
  • Bought back 56m shrs
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  • PREVIEW BANKS 3Q: JPMorgan Kicks Off Low Bar Earnings Season
Alert: HALISTER
Source: BFW (Bloomberg First Word)

Tickers
C US (Citigroup Inc)

People
Mike Corbat (Citigroup Global Markets Inc)

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