Slide 1: Earnings Results Presentation Fourth Quarter and Full Year 2022
Earnings Results Presentation Fourth Quarter and Full Year 2022 January 13, 2023
Slide 2: Agenda
Agenda Page 1 4Q22 and FY 2022 Financial Results 3 2 Financial Outlook ▪ 2023 Outlook 19 ▪ Medium-term Outlook 22 3 Appendix 26 Confidential 2
Slide 3: Fourth Quarter and Full Year Results Snapshot
Fourth Quarter and Full Year Results Snapshot Revenues Net Income EPS 4Q22 $18.0 billion 4Q22 $2.5 billion 4Q22 $1.16 2022 $75.3 billion 2022 $14.8 billion 2022 $7.00 RoTCE(1) CET1 Capital Ratio(2) Tangible Book Value Per Share(3) 4Q22 5.8% 4Q22 13.0% 4Q22 $81.65 2022 8.9% 3Q22 12.3% vs. 3Q22 2% Ful
Slide 4: 2022 Year in Review Against Our Priorities
2022 Year in Review Against Our Priorities Transformation Strategic Execution Culture and Talent • Significantly expanded firmwide project management • Refreshed the strategic vision for Citi, focused around • Made key senior leadership changes and execution capabilities with clear accountabilities
Slide 5: Our Path Forward Comes In Three Phases & 2023 Falls In Phase 1
Reminder That Our Path Forward Comes In Three Phases & 2023 Falls In Phase 1 PHASE 1 PHASE 2 (3-5 YEARS From 2021) PHASE 3 Execute and Invest Deliver Medium-term Targets Longer-term • Ramp up of execution against • Mix begins to shift towards higher • Further revenue growth from transformation miles
Slide 6: Financial Results Overview
Financial Results Overview Financial Results Q4 2022 Financial Overview Highlights ($ in MM, except EPS) 4Q22 % Δ QoQ % Δ YoY 2022 % Δ YoY • Revenues – Up 6% YoY, up 5% excluding divestiture-related impacts(4)(5), as strength across Services, Markets and US Personal Banking was partially offset Net
Slide 7: FY 2022 vs. FY 2021 Revenue Growth
FY 2022 vs. FY 2021 Revenue Growth Year-over-year revenue growth of 3% ex-divestiture-related impacts(1), in-line with guidance of low single-digits ($ in B) Up 5% on a Citigroup Revenue Growth of 3% Ex-Divestiture-related Impacts(1) Reported Basis $0.9 $1.0 $1.4 $74.5 $0.9 $75.3 $71.9 $72.6 ($1.3)
Slide 8: FY 2022 vs. FY 2021 Expense Growth
FY 2022 vs. FY 2021 Expense Growth Year-over-year expense growth of 8% ex-divestiture-related impacts(1), in-line with guidance of 7-8% ($ in B) Up 6% on a Citigroup Expense Growth of 8% Ex-Divestiture-related Impacts(1) Reported Basis $0.7 $51.3 ~3 % $50.6 $48.2 ~2 % ~1 % ~1 % $47.0 7.1 7.8 • Macro
Slide 9: 2022 KPIs Progress vs. Investor Day Medium-term Targets
2022 KPIs Progress vs. Investor Day Medium-term Targets We are benchmarking our 2022 results against the Medium-term KPI targets Investor Day Business Investment Themes KPIs Medium-term Targets (2024-2026) 2022 Results(1) • Integrated solutions • Average Deposits • Mid Single-Digits CAGR • +1% • Imp
Slide 10: Net Interest Income, Average Loans and Deposits
Net Interest Income, Average Loans and Deposits ($ in B) Net Interest Income 2.24% 2.31% 2.39% 4Q22 4Q22 1.98% 2.05% QoQ r YoY r Citigroup NIM $13.27 $12.56 $0.71 $2.45 $11.96 1.49 $10.82 $10.87 1.23 1.36 $0.26 $0.25 Markets(1) 1.24 1.09 10.60 11.33 11.78 $0.45 $2.20 Ex-Markets 9.58 9.78 4Q21 1Q22 2
Slide 11: Consumer & Corporate Loan, Exposure and Credit Metrics
Consumer & Corporate Loan, Exposure and Credit Metrics We maintain over $19B of reserves and a reserve-to-funded loan ratio of approximately 2.6% ($ in B) US Cards Corporate Loan Exposure EOP Loans by Segment EOP Loans by FICO Score(1) By Region (2022) By Grade Rating (2022) Latin America 8% In our
Slide 12: Capital and Balance Sheet Overview
Capital and Balance Sheet Overview ($ in B, except per share data) Risk-based Capital Metrics(1) End of Period Assets 4Q21 3Q22 4Q22 YoY $2,381 $2,417 5% CET1 Capital $149 $145 $149 $2,291 300 342 31% Cash 262 Standardized RWAs 1,219 1,177 1,143 Investments, net 513 508 527 3% CET1 Capital Ratio - S
Slide 13: Standardized CET1 Ratio Overview
Standardized CET1 Ratio Overview 4Q22 QoQ Standardized CET1 Ratio Walk CET1 Standardized Regulatory Requirement and Target Drivers of CET1 Capital ratio increasing to 13.0%(1), above the regulatory requirement • Well capitalized today with a CET1 Capital ratio of 13.0%, 100 bps as of January 1, 2023
Slide 14: Institutional Clients Group Results
Institutional Clients Group Results Institutional Clients Group Results Institutional Clients Group Highlights ($ in MM) 4Q22 % Δ QoQ % Δ YoY • Revenues – Up 3% YoY, driven by TTS, Securities Services and Fixed Income Net Interest Income $5,037 10% 34% Markets, partially offset by a decline in Banki
Slide 15: Personal Banking & Wealth Management Results
Personal Banking & Wealth Management Results Personal Banking & Wealth Management Results Personal Banking & Wealth Management Highlights ($ in MM) 4Q22 % Δ QoQ % Δ YoY • Revenues – Up 5% YoY, as growth in net interest income was partially offset Net Interest Income $5,866 1% 10% by a decline in non
Slide 16: Legacy Franchises Results
Legacy Franchises Results Legacy Franchises Results Legacy Franchises Highlights ($ in MM) 4Q22 % Δ QoQ % Δ YoY • Revenues – Down 6% YoY, primarily driven by the reduction in revenues from the closings of five exit markets, as well as the impact of the wind-downs Net Interest Income $1,324 (4)% (14)
Slide 17: Corporate / Other Results
Corporate / Other Results Corporate / Other Results Corporate / Other Highlights ($ in MM, unless otherwise noted) 4Q22 % Δ QoQ % Δ YoY • Revenues – Higher revenue YoY, largely driven by higher net revenue from Net Interest Income $1,043 35% NM the investment portfolio Non-Interest Revenue (344) 27%
Slide 18: Agenda
Agenda Page 1 4Q22 and FY 2022 Financial Results 3 2 Financial Outlook ▪ 2023 Outlook 19 ▪ Medium-term Outlook 22 3 Appendix 26 Confidential 18
Slide 19: 2023 in Phase 1 of Execute and Invest
2023 in Phase 1 of Execute and Invest PHASE 1 2023 Targets Execute and Invest • Ramp up of execution against transformation milestones Revenues Expenses • Investment-driven revenue growth • Top-line benefits from macro factors $78B – $79B, excluding 2023 ~$54B, excluding 2023 • Continued investments
Slide 20: 2023 Revenues vs. 2022 Revenues
2023 Revenues vs. 2022 Revenues ($ in B) 2023 Revenue Outlook 5% $78–-$79B $78B 79 $71.9 $75.3 Guidance Total Revenues 7% 19.1 Full Year 2023 Revenues: $78B – $79B, Markets(4) 17.9 excluding 2023 divestiture-related impacts(2,3) 12.7 NIR Ex-Markets(5) 16.7 (24)% 1Q 2023 Revenues: Up mid-single digit
Slide 21: 2023 Expenses vs. 2022 Expenses
2023 Expenses vs. 2022 Expenses ($ in B) 2023 Expense Outlook Expenses Ex-Divestiture-related Impacts (1) Guidance Divestiture-related Impacts(1) Full Year 2023 Expenses: ~$54B, excluding 2023 divestiture-related impacts(2,3) $53.5 ~$54- 54+ 1Q 2023 Expenses: Up mid-single digits, ~$0.7 Divestiture
Slide 22: While the Environment Has Changed, Our Strategy Has Not
While the Environment Has Changed, Our Strategy Has Not Medium-term Phase Committed to 11-12% RoTCE Medium-term Target (3-5 Years) Underlying Drivers vs. Investor Day • Deliver Medium-Term Targets Revenues Expenses • Higher NII at a more measured rate • Benefits from market exits and • Mix begins to
Slide 23: Forward-looking statements
Certain statements in this presentation are “forward-looking statements” within the meaning of the rules and regulations of the Private Securities Litigation and Reform Act of 1995. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumst
Slide 24: Citi
CItI
Slide 25: Agenda
Agenda Page 1 4Q22 and FY 2022 Financial Results 3 2 Financial Outlook ▪ 2023 Outlook 19 ▪ Medium-term Outlook 22 3 Appendix 26 Confidential 25
Slide 26: FY 2022 Financial Summary of Businesses
FY 2022 Financial Summary of Businesses ($ in B) • ICG and PBWM core revenues growing faster than Legacy Franchises • Increasing expenses in ICG and PBWM primarily driven by transformation and business-led investments 2022 ICG PBWM Corp. / Other Legacy Franchises Total $ in billions $ YoY Δ (% ) $ Y
Slide 27: ICG Revenue Items and Selected Business Drivers and Statistics
ICG Revenue Items and Selected Business Drivers and Statistics Revenues 4Q22 Highlights ($ in MM) 4Q22 % Δ QoQ % Δ YoY 2022 % Δ YoY Services Net Interest Income $2,344 5% 61% $8,306 46% Non-interest revenue 946 (3)% (1)% 3,857 10% • Treasury and Trade Solutions revenues were up 36% YoY, driven by 61
Slide 28: PBWM Revenues Items and Selected Business Drivers and Statistics
PBWM Revenues Items and Selected Business Drivers and Statistics Revenues 4Q22 Highlights ($ in MM) 4Q22 % Δ QoQ % Δ YoY 2022 % Δ YoY • Branded Cards revenues up 15% YoY, driven by higher net interest income; Branded Cards $2,376 5% 15% $8,892 9% continue to see strong underlying drivers, with 14% g
Slide 29: Estimated Timelines for Signed Exit Markets & Contribution
Estimated Timelines for Signed Exit Markets & Contribution ($ in B) Exit Markets Contribution to P&L (1) (1) 2021 2022 Status Revenue Expenses Revenue Expenses Closed $0.7 $1.0 $1.8 $0.9 Signed / In Process 5.9 4.3 5.9 4.7 Wind-Downs / On Hold / Other 1.7 3.0 0.8 2.2 Legacy Franchises 8.3 8.3 8.5 7.
Slide 30: Update on Russia Exposure
Update on Russia Exposure Overview • Russia exposure decreased by approximately $0.4 billion from last quarter: ꟷ 1 Exposure decrease of $1.3 billion driven by the depreciation of the ruble ꟷ 2 Exposure decrease of $0.9 billion, in local currency terms, primarily driven by reductions in loans throug
Slide 31: 4Q22 Credit Portfolio by Segment and Geography
4Q22 Credit Portfolio by Segment and Geography (4Q22 EOP $ in B) ICG PBWM Legacy Franchises Signed Exit Markets EOP Hong Kong Brazil Singapore Hong KongSingapore Emerging Loans(1): ~$12B 3% 4% 3% Mexico 6% EMEA Geographic Loan Distribution 6% EMEA 4% 3% China North 4% China 8% America Developed Kore
Slide 32: Credit Trends for Branded Cards and Retail Services
Credit Trends for Branded Cards and Retail Services ($ in B) Branded Cards Retail Services NCL 90+ DPD NCL 90+ DPD EOP 4Q21 3Q22 4Q22 EOP 4Q21 3Q22 4Q22 Loans $87.9 $93.7 $100.2 Loans $46.0 $46.7 $50.5 3.45% 3.30% 3.09% 2.84% 2.60% 2.71% 2.36% 2.23% 2.31% 2.10% 1.73% 1.50% 1.50% 1.68% 1.33% 1.46% 1.
Slide 33: Equity & CET1 Capital Drivers (QoQ and YoY)
Equity & CET1 Capital Drivers (QoQ and YoY) ($ in B, except basis points (bps)) Tangible Common CET1 Capital Ratio(2) QoQ Common Equity CET1 Capital (2) Equity (1) (bps) 3Q22 $179.6 $155.6 $144.6 12.3% Impact of: CECL Transtion Provision(3) N/A N/A - - Net Income 2.5 2.5 2.5 21 Preferred Stock Divid
Slide 34: Tangible Common Equity Reconciliation and Citigroup Returns
Tangible Common Equity Reconciliation and Citigroup Returns ($ in MM, except per share amounts) Tangible Common Equity and Tangible Book Value Per Share Return on Tangible Common Equity (RoTCE) 4Q21 3Q22 4Q22 4Q22 2022 Citigroup Net Income $2,513 $14,845 Less: Com m on Stockholders' Equity $182,977
Slide 35: FX Impact
FX Impact ($ in MM) Total Citigroup ICG Foreign currency (FX) translation im pact (1) 4Q22 3Q22 4Q21 QoQ YoY Foreign currency (FX) translation im pact (1) 4Q22 3Q22 4Q21 QoQ YoY Total Revenue- as Reported 18,006 18,508 17,017 (3)% 6% Total Average Loans - as reported 285 291 289 (2)% (1)% Impact of
Slide 36: Reconciliation of Adjusted Results
Reconciliation of Adjusted Results Citigroup ($ in MM) 4Q22 4Q21 % Δ YoY 2022 2021 % Δ YoY 1Q22 Total Citigroup Revenues - As Reported $18,006 $17,017 6% $75,338 $71,884 5% $19,186 Less: Total Divestiture Impact on Revenues(1) 209 (13) 854 (670) (47) Total Citigroup Revenues, Excluding Divestiture I
Slide 37: Reconciliation of Adjusted Results (cont.)
Reconciliation of Adjusted Results (cont.) ICG ($ in MM) 4Q22 4Q21 % Δ YoY 2022 2021 % Δ YoY Total Institutional Clients Group (ICG) - As Reported $9,159 $8,908 3% $41,206 $39,836 3% Markets 3,944 3,332 19,113 17,876 Total Citigroup ICG Ex-Markets $5,215 $5,576 (6)% $22,093 $21,960 1% ($ in MM) 4Q22
Slide 38: Footnotes
Footnotes Slide 3 1) Return on Tangible Common Equity (RoTCE) is a non-GAAP financial measure. RoTCE represents annualized net income available to common shareholders as a percentage of average TCE. For a reconciliation to reported results, please refer to Slide 34. 2) 4Q22 is preliminary. Citigroup
Slide 39: Footnotes continued
Footnotes continued Slide 6 1) Allowance for Credit Losses (ACL) Build / (Release) and Other provisions includes a net ACL build of approximately $640 million related to loans and unfunded lending commitments as well as other provisions of approximately $25 million relating to policyholder benefits
Slide 40: Footnotes continued
Footnotes continued Slide 9 1) 2022 wallet share results are preliminary. 2) U.S. Dollar Clearing Volume is defined as the number of USD Clearing Payment instructions processed by Citi on behalf of US and foreign-domiciled entities (primarily Financial Institutions). 3) Cross-Border Transaction Valu
Slide 41: Footnotes continued
Footnotes continued Slide 12 1) 4Q22 is preliminary. Citigroup’s binding CET1 Capital ratios were derived under the U.S. Basel III Standardized Approach. For the composition of Citigroup’s CET1 Capital, please see Appendix C of the 4Q22 earnings press release included as Exhibit 99.1 to Citigroup’s
Slide 42: Footnotes continued
Footnotes continued Slide 15 1) Allowance for Credit Losses (ACL) Build / (Release) and Other provisions includes a net ACL build of approximately $752 million related to loans and unfunded lending commitments as well as other provisions of approximately $6 million relating to policyholder benefits
Slide 43: Footnotes continued
Footnotes continued Slide 20 1) See footnote 4 to Slide 6. 2022 revenues included divestiture-related impacts of approximately $854, primarily comprised of pre-tax gains related to the sales of the Philippines consumer business in 3Q22 of approximately $616 million and the Thailand consumer business
Slide 44: Footnotes continued
Footnotes continued Slide 22 1) Citi Commercial Bank (CCB) is not an operating segment or reporting unit. CCB represents Citi’s business with mid-sized companies across our product suite. Financial results from this client group are embedded in the ICG’s various products, including Services, Banking
Slide 45: Footnotes continued
Footnotes continued Slide 29 1) See footnote 4 to Slide 6. Revenues and expenses excluding divesture-related impacts are non-GAAP financial measures. • 2022 revenues include divestiture-related impacts of approximately $854 million, primarily comprised of pre-tax gains related to the sale of the Phi
Slide 46: Footnotes continued
Footnotes continued Slide 34 1) Net income to common for Corp./ Other is reduced by preferred dividends of approximately $238 million in 4Q22 and approximately $1 billion in 2022. 2) Tangible common equity (TCE) allocated to ICG, PBWM and Legacy Franchises is based on estimated full year 2022 capita