Slide 1: Earnings Results Presentation
January 12th, 2024 Earnings Results Presentation Fourth Quarter and Full Year 2023
Slide 2: Agenda
Agenda Page 1. 4Q23 and FY 2023 Financial Results 3 2. Financial Outlook 20 3. Appendix 28 2
Slide 3: Our strategy and path forward remains unchanged
Our strategy and path forward remains unchanged Our Vision Be the preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in our home market Delivering on our Investor Day priorities Transformation Invest for Growth Simplif
Slide 4: New organizational structure is now aligned with strategic vision
New organizational structure is now aligned with strategic vision Running the Company Services USPB Differently TTS : #1 Rank(1) Branded Cards and Retail • Aligns our organizational Securities Services Services: #2 Rank in U.S. #4 Rank(2) Cards(6) structure to our business strategy #1 in Direct Cust
Slide 5: Fourth quarter and full year 2023 results snapshot
Fourth quarter and full year 2023 results snapshot Revenues Net Income EPS 4Q23 $17.4B / (3)% YoY 4Q23 $(1.8)B / NM YoY 4Q23 $(1.16) / NM YoY 2023 $78.5B / 4% YoY 2023 $9.2B / (38)% YoY 2023 $4.04 / (42)% YoY RoTCE(1) CET1 Capital Ratio(2) Tangible Book Value Per Share(3) 4Q23 (5.1)% 4Q23 13.3% 4Q23
Slide 6: 2023 year in review against our priorities
2023 year in review against our priorities Transformation Strategic Execution Organization, Culture, and Talent ✓ Closed the FX Consent Order with the FRB Strategy: ✓ Announced consequential organizational changes ✓ Executed with urgency on our Transformation ✓ Continued strength in Services, with i
Slide 7: Financial results overview
Financial results overview Financial Results Notable Items in the Quarter ($ in MM, except EPS) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY Pretax Net Interest Income $13,824 - 4% $54,900 13% Impact on 4Q23: EPS RoTCE ($B) Non-Interest Revenue 3,616 (43)% (24)% 23,562 (12)% FDIC Special Assessment related to
Slide 8: Full year revenue trend
Full year revenue trend FY Revenues of $77.1B ex-divestitures(1) and $47.6B NII ex-Markets(2) ($ in B) 78.5 -23 CAGR 4% Underlying Drivers 5% 75.3 4% Reported 71.9 Revenue • Increase in USD and Non-USD rates 18.1 20% • Growth driven by new client wins and deepening with 15.6 Services Services 12.5 e
Slide 9: Full year expense trend
Full year expense trend FY Expenses of $54.3B ex-divestitures and FDIC Special Assessment(1), in-line with guidance of ~$54B ($ in B) 56.4 Reported Includes: • Expenses 51.3 1.7 of FDIC Transformation 48.2 infrastructure, automate manual processes and impact and investments enhance data and analytic
Slide 10: Transformation and technology spend historical trend
Transformation and technology spend historical trend Transformation Expense Trend ($ in B) $2.9 $2.8 • Automated independent price verification for more than 90% of Fixed Income and Equity securities, reducing manual controls $0.8 Technology • Launched initial set of capabilities for Strategic Whole
Slide 11: U.S. cards and corporate credit overview
U.S. cards and corporate credit overview ($ in B) U.S. Cards Loans Corporate Lending Exposure EOP Loans by Segment EOP Loans by FICO Score(1) By Region By Grade Rating International Exposure Other, 10% Branded 66% 68% 67% Cards ≥ 680 81% 80% 79% IG 84% 83% 83% International U.S. IG / MNCs or 46% sub
Slide 12: Capital and balance sheet overview
Capital and balance sheet overview ($ in B, except per share data) Risk-based Capital & Liquidity Metrics(1) End of Period Assets 4Q22 3Q23 4Q23 $2,417 $2,368 $2,405 YoY - CET1 Capital $149 $156 $153 Cash 342 254 261 (24)% Standardized RWA 1,143 1,149 1,153 Investments, net 509 519 527 (1)% CET1 Cap
Slide 13: Services results, key metrics and statistics
Services results, key metrics and statistics Financial Results Highlights ($ in MM) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY • Revenues Up 6% YoY for the quarter largely, driven by NII growth in TTS and Net Interest Income 2,869 1% 13% 11,027 25% Securities Services, partially offset by lower NIR from the
Slide 14: Markets results, key metrics and statistics
Markets results, key metrics and statistics Financial Results Highlights ($ in MM) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY • Revenues Down (19)% YoY, driven by Fixed Income (down (25)%), partially Rates and currencies 1,758 (37)% (36)% 10,885 (6)% offset by Equities (up 9%) and embedded in these results i
Slide 15: Banking results, key metrics and statistics
Banking results, key metrics and statistics Financial Results Highlights ($ in MM) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY • Revenues Up 22% YoY, driven by growth in Investment Banking revenues Investment Banking 669 (3)% 27% 2,538 1% (up 27%) and lower losses on loan hedges, partially offset by Corporate
Slide 16: Wealth results, key metrics and statistics
Wealth results, key metrics and statistics Financial Results Highlights ($ in MM) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY • Revenues Down (3)% YoY, driven by lower deposit spreads, partially offset Private Bank 542 (12)% (10)% 2,332 (17)% by lower mortgage funding cost and higher investment fee revenues W
Slide 17: U.S. Personal Banking results, key metrics and statistics
U.S. Personal Banking results, key metrics and statistics Financial Results Highlights ($ in MM) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY • Revenues Up 12% YoY, driven by an increase in NII on loan growth in cards Branded Cards 2,620 3% 10% 9,988 11% and higher deposit spreads Retail Services 1,636 (5)% 15
Slide 18: All Other (Managed Basis) results, key metrics and statistics
All Other (Managed Basis(1)) results, key metrics and statistics Financial Results Highlights ($ in MM) 4Q23 % Δ QoQ % Δ YoY 2023 % Δ YoY • Revenues Down (17)% YoY, driven by a decrease in NII largely driven by Legacy Franchises 1,710 (5)% (7)% 7,198 (4)% Corporate/Other higher funding costs and the
Slide 19: Agenda
Agenda Page 1. 4Q23 and FY 2023 Financial Results 3 2. Financial Outlook 20 3. Appendix 28 19
Slide 20: 2024 Revenue outlook
2024 Revenue outlook Full Year Revenue Trend 2024 Revenue Drivers ($ in B) Reported 4% $75.3 $78.5 ~$80-81B Revenues(1) ~4% ~$80-81B • TTS: Client wins and deepening with existing Revenue 4% $77.1 ex- $74.5 relationships Divestitures(1,2) NIR ex-Markets • Securities Services: Continue to onboard man
Slide 21: 2024 Expense outlook
2024 Expense outlook Full Year Expense Trend 2024 Expense Drivers ($ in B) Reported ~53.5-53.8 3Q23 YTD Expenses 51.3 56.4 • Took ~$600mm of severance related to 6k 54.3 ~53.5-53.8 headcount, which was offset by hiring across Expenses, ex- Divestitures 50.6 technology, operations and other risk and
Slide 22: Drivers of medium-term expenses
Drivers of medium-term expenses Three Drivers of Expense Reduction ($ in B) Expenses, ex- 54.3 53.5-53.8 Divestitures 51.0-53.0 Headcount ex-Mexico(3) & FDIC(1,2) 50.6 (2.0-2.5) Year-End Expense saves Efficiencies to be ~200k include reduced realized from 2023 severance and other Transformation cost
Slide 23: 2024 U.S. cards outlook
2024 U.S. cards outlook • Expect NCL rates in both portfolios to rise above pre-COVID levels • Reserved for a weighted 8-quarter average unemployment rate of ~5.0% with downside assumption of 6.8% • Expect mid-single digit loan growth in both portfolios Branded Cards NCL Trend Retail Services NCL Tr
Slide 24: Full year 2024 guidance and medium-term targets
Full year 2024 guidance and medium-term targets Full Year 2024 Guidance Underlying Drivers of Medium-Term Targets • 4-5% revenue CAGR as we continue to execute in Services, Markets and USPB • Full year revenues: ~$80-81 billion(1) Revenue • Capitalize on expected rebound in Banking wallet • NII ex-M
Slide 25: uncertainty and changes in circumstances. These statements are not guarantees of future results or
- uncertainty and changes in circumstances. These statements are not guarantees of future results or occurrences. Actual results and capital and other financial condition may differ materially from those included in these statements due to a , from its transformation, strategic and other initiatives
Slide 26: Slide 26
Slide 27: Agenda
Agenda Page 1. 4Q23 and FY 2023 Financial Results 3 2. Financial Outlook 20 3. Appendix 28 27
Slide 28: Net interest income, average loans and deposits
Net interest income, average loans and deposits ($ in B) Net Interest Income 2.39% 2.41% 2.48% 2.49% 2.46% QoQ YoY Citigroup NIM $13.90 $(0.01) $0.55 $13.27 $13.35 $13.83 $13.82 Markets(1) 1.58 1.56 2.01 1.70 1.99 $0.29 $0.41 11.69 11.79 11.89 12.13 11.83 $(0.30) $0.14 ex-Markets 4Q22 1Q23 2Q23 3Q23
Slide 29: 2023 KPIs progress vs. medium-term targets
2023 KPIs progress vs. medium-term targets Investor Day Targets Through 2023 Results Business KPIs the Medium Term vs. 2021(1) • Average Deposits • Mid Single-Digits CAGR • +1% CAGR • USD Clearing Volumes(2) • High Single-Digits CAGR • +4% CAGR TTS • Cross-Border Transaction Value(3) • High Single-D
Slide 30: Standardized CET1 ratio overview
Standardized CET1 ratio overview 4Q23 QoQ Standardized CET1 Ratio Walk CET1 Standardized Regulatory Requirement and Target Key drivers resulting in CET1 Capital ratio of 13.3%(1) • Well capitalized today with a CET1 Capital ratio of 13.3%, ~100bps above the 4Q23 regulatory requirement including a 10
Slide 31: Historical average deposit growth
Historical average deposit growth ($ in B) Total CAGR: 5.3% Services CAGR: 6.2% 1,343 1,370 1,334 1,323 1,316 1,361 1,363 1,338 1,315 1,320 1,305 1,304 1,321 1,268 103 82 80 105 100 94 1,234 110 93 98 101 122 121 117 117 115 118 116 111 111 113 1,090 1,115 115 113 114 115 110 105 104 109 1,017 1,040
Slide 32: 4Q23 Liquidity and investment portfolio metrics
4Q23 Liquidity and investment portfolio metrics ($ in B) Average LCR and Historical Trajectory (30-Day Stress) EOP Available Liquidity Resources(1) LCR 4Q22 3Q23 $561 Ratio 118% 117% $483 $965 $171 Comprised of unencumbered Other Liquidity securities and unused borrowing Resources = $403 capacity $2
Slide 33: Update: Net Investment Change in Argentina Since 4Q19
Update • Citi has operated in Argentina for over 100 years and currently serves approximately 1,300 clients, including 700 multinational clients (MNC) • Generally, we support these clients in Argentina as part of a broader institutional relationship which spans many other countries around the world
Slide 34: Net Investment Change in Russia Since 4Q22
• Ended nearly all of the institutional banking services offered in Russia as of March 31, 2023 • Remaining services are only those necessary to fulfill our remaining legal and regulatory obligations • Continue to wind down the consumer and local commercial banking businesses • As of year- approxima
Slide 35: Summary of financial reporting changes to segment revenue
Summary of financial reporting changes to segment revenue 1. We now have new reporting segments reflective of our new organizational structure 2. Due to these new reporting segments, we also moved certain businesses among reporting segments 3. Allocations updated to reflect new structure Impacts on
Slide 36: 4Q23 / FY23 reconciliation of adjusted results ex-notable items
4Q23 / FY23 reconciliation of adjusted results ex-notable items(1) As-reported P&L for the respective segments adjusted for notable items for the periods presented Services P&L Items (4Q23) P&L Items (FY23) ($ in MM) 4Q23 Argentina ($ in MM) FY23 Argentina 4Q23 4Q23 Transfer Risk 4Q23 FY23 FY23 Tran
Slide 37: 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 RoTCE by Segment 4Q23 3Q23 4Q22 ($ in B) Net Income Average RoTCE(3) 4Q23 to Common (1) Allocated TCE(2) Common Stockholders' Equity $187,853 $190,
Slide 38: FX impact
FX impact ($ in MM) Total Citigroup Legacy Franchises (1) 4Q23 3Q23 4Q22 QoQ YoY Foreign currency (FX) translation impact Foreign currency (FX) translation impact(1) 4Q23 3Q23 4Q22 QoQ YoY Total Revenues - as Reported 17,440 20,139 18,006 (13)% (3)% Mexico Revenues - as reported 1,461 1,522 1,221 (4
Slide 39: Reconciliation of adjusted results
Reconciliation of adjusted results Total Citigroup Citigroup ($ in MM) 4Q23 4Q22 % Δ QoQ % Δ YoY 2023 2022 % Δ YoY 2021 % Δ YoY Total Citigroup Revenues - As Reported $17,440 $18,006 (13)% (3)% $78,462 $75,338 4% $71,884 5% Less: Total Divestiture Impact on Revenues (1) (62) 209 1,346 854 (670) Tota
Slide 40: Reconciliation of adjusted results (cont.)
Reconciliation of adjusted results (cont.) Banking ($ in MM) 4Q23 3Q23 4Q22 % Δ QoQ % Δ YoY 2023 2022 % Δ YoY Total Banking Revenues - As Reported $949 $1,344 $778 (29)% 22% $4,568 $5,396 (15)% Less: Gain/(loss) on loan hedges(1) (131) (47) (300) (443) 307 Total Banking Revenues - Excluding Gain/(lo
Slide 41: Glossary
Glossary ACL: Allowance for Credit Losses EPS: Earnings per Share NII: Net Interest Income ACLL: Allowance for Credit Losses on Loans F&S: Financing & Securitization NIM: Net Interest Margin AFS: Available for Sale FI: Fixed Income NIR: Non-Interest Revenue AOCI: Accumulated Other Comprehensive Inco
Slide 42: Footnotes
Footnotes Slide 4 1) Source nal Corporate & FI Client Segment . Peer Group includes BAC, BARC, BNPP, DB, HSBC, JPM, SG, SCB, USB, and WFC. 2) Source nal includes BBH, BNPP, BNY, CACEIS, DB, HSBC, JPM, NT, RBC, SCB, SG and ST. 3) Source my - comparable items. Peer group for ranking purposes includes
Slide 43: Footnotes (cont.)
Footnotes (cont.) Slide 7 1) Allowance for Credit Losses (ACL) Build / (Release) and Other provisions includes a net ACL build of approximately $397 million related to loans and unfunded lending commitments as well as other provisions of approximately $1,156 million relating to held-to-maturity (HTM
Slide 44: Footnotes (cont.)
Footnotes (cont.) Slide 12 1) th -K filed with the SEC on January 12, 2024. Certain prior period amounts and ratios have been revised to conform with enhancements made in the current period. 2) 4Q23 is preliminary. For the composition of Citigroup's Supplementary Leverage ratio, please see Appendix
Slide 45: Footnotes (cont.)
Footnotes (cont.) Slide 14 1) Allowance for Credit Losses (ACL) Build / (Release) and Other provisions includes a net ACL build of approximately $53 million related to loans and unfunded lending commitments as well as other provisions of approximately $126 million relating to held-to-maturity (HTM)
Slide 46: Footnotes (cont.)
Footnotes (cont.) Slide 16 1) Allowance for Credit Losses (ACL) Build / (Release) and Other provisions includes a net ACL release of approximately $(26) million related to loans and unfunded lending commitments as well as other provisions of approximately $(1) million relating to benefits and claims
Slide 47: Footnotes (cont.)
Footnotes (cont.) Slide 18 1) All Other (Managed Basis) reflects results on a managed basis, which excludes divestiture-related impacts, for all periods, related to Citi's divestitures of its Asia consumer banking businesses and the planned divestiture of Mexico consumer banking and small business a
Slide 48: Footnotes (cont.)
Footnotes (cont.) Slide 21 1) Full year 2023 expenses included divestiture-related impacts & FDIC special assessment of approximately $2,078 million primarily consisting of the FDIC special assessment of $1,706 million and divestiture related impacts of $372 million primarily related to separation c
Slide 49: Footnotes (cont.)
Footnotes (cont.) Slide 24 1) This is a forward-looking Non-GAAP Financial Measure. From time-to-time, management may discuss forward-looking non-GAAP financial measures, such as forward-looking estimates or targets for revenue, expenses, and RoTCE. We are unable to provide a reconciliation of forwa
Slide 50: Footnotes (cont.)
Footnotes (cont.) Slide 30 1) 4 omp -K filed with the SEC on January 12, 2023. 2) Includes changes in goodwill and intangible assets, and changes in Other Comprehensive Income. Also includes deferred tax excludable from Basel III CET1 Capital, which includes net DTAs arising from net operating loss,
Slide 51: Footnotes (cont.)
Footnotes (cont.) Slide 36 1) Results of operations excluding the impact from these notable items are non-GAAP financial measures. Citi believes the presentation of its results of operations and financial condition excluding the impacts of these notable items provides a meaningful depiction of the u
Slide 52: Footnotes (cont.)
Footnotes (cont.) Slide 38 1) Reflects the impact of foreign currency (FX) translation into U.S. dollars applying the fourth quarter 2023 average exchange rates for all periods presented, with the exception of EOP loans and slation are non-GAAP financial measures. Slide 39 1) Divestiture related imp