Slide 1: Third Quarter 2020 Earnings Review
Citi | Investor Relations Third Quarter 2020 Earnings Review October 13, 2020
Slide 2: Overview
Overview Solid performance despite macro environment – Robust deposit growth across both Consumer and Institutional franchises – Revenue growth in ICG reflects strong performance in Markets and Investment Banking – Sequential improvement in spend activity and solid digital engagement across Consumer
Slide 3: Citigroup – Summary Financial Results
Citigroup – Summary Financial Results ($MM, except EPS) 3Q'20 2Q'20 %r 3Q'19 %r YTD'20 %r Revenues $17,302 $19,766 (12)% $18,574 (7)% $57,799 3% Operating Expenses 10,964 10,415 5% 10,464 5% 31,973 1% Efficiency Ratio 63.4% 52.7% 56.3% 55.3% Operating Margin 6,338 9,351 (32)% 8,110 (22)% 25,826 6% N
Slide 4: CECL Details
CECL Details ($B) Allowance for Credit Losses Balance Balance Balance ACLL / Balance CECL 1Q'20 2Q'20 3Q'20 Loans as of Transition as of as of as of Build (1) Build (1) Build (1) as of 12/31/19 Impact 3/31/20 6/30/20 9/30/20 9/30/20 Cards $8.4 $4.5 $2.4 $15.1 $1.6 $16.7 $(0.0) $16.7 11.42% All other
Slide 5: Global Consumer Banking
Global Consumer Banking (Constant $MM) 3Q'20 QoQ % r YoY % r YTD'20 %r • Revenues Revenues $7,173 (3)% (12)% $22,686 (6)% North America 4,527 (5)% (13)% 14,493 (4)% – Down 12% YoY, driven by lower International 2,646 (1)% (12)% 8,193 (8)% card volumes and lower interest rates across all regions,
Slide 6: North America Consumer Banking
North America Consumer Banking ($MM) 3Q'20 QoQ % r YoY % r YTD'20 %r • Revenues Revenues $4,527 (5)% (13)% $14,493 (4)% – Down 13% YoY Branded Cards 2,061 (7)% (12)% 6,626 (1)% – Branded Cards: Down 12% YoY, Retail Services 1,353 (3)% (21)% 4,502 (10)% driven by lower purchase sales and Retail
Slide 7: International Consumer Banking
International Consumer Banking (Constant $MM) 3Q'20 QoQ % r YoY % r YTD'20 %r • Revenues Revenues $2,646 (1)% (12)% $8,193 (8)% – Latin America: Down 10% YoY, driven by Latin America 1,027 (6)% (10)% 3,276 (6)% lower loan volumes and lower deposit Asia(1) 1,619 3% (13)% 4,917 (10)% spreads, part
Slide 8: Global Consumer Banking – Credit Trends
Global Consumer Banking – Credit Trends (EOP Loans in Constant $B) NCL 90+ DPD Global Consumer Banking North America EOP 3Q'19 2Q'20 3Q'20 EOP 3Q'19 2Q'20 3Q'20 Loans $286.2 $274.5 $272.4 Loans $190.6 $181.1 $178.6 3.08% 3.07% 3.18% 3.30% 2.70% 2.68% 2.52% 2.51% 2.75% 2.80% 2.72% 2.84% 2.90% 2.63% 2
Slide 9: Institutional Clients Group
Institutional Clients Group ($MM) 3Q'20 QoQ % r YoY % r YTD'20 %r • Revenues – Total Banking(2): Down 2% YoY: Product Revenues • TTS down 6% YoY(1), driven by the Total Banking $5,257 (7)% (2)% $16,099 (2)% impact of lower interest rates and - Treasury & Trade Solutions(1) 2,394 4% (6)% 7,124 (7)%
Slide 10: Corporate / Other
Corporate / Other ($MM) 3Q'20 QoQ % r YoY % r YTD'20 %r • Revenues Revenues $(224) $139 – Down YoY, reflecting the wind- NM NM (91)% down of legacy assets, the lower Expenses 969 NM 100% 1,854 22% rate environment and marks on securities Credit Costs (136) NM NM 220 NM • Expenses EBT (1,057) NM NM (
Slide 11: Citigroup – Net Interest Revenue & Markets Revenue
Citigroup – Net Interest Revenue & Markets Revenue Net Interest Revenue (NIR) (Constant $B) 2.72% 2.67% 2.63% 2.56% 2.48% Citigroup NIM 2.17% 3Q'20 3Q'20 YTD'20 2.03% QoQ r YoY r YoY r $11.49 $11.79 $11.42 $11.71 $11.43 $(0.67) $(0.93) $(1.62) $11.16 Markets(1) 0.88 1.30 0.79 1.15 $10.49 1.13 1.50 $
Slide 12: Citigroup – Key Capital Metrics
Citigroup – Key Capital Metrics ($B, except TBV) Common Equity Tier 1 Capital Ratio(1) Supplementary Leverage Ratio(1) Tangible Book Value / Share(2) 100.00 11.7% 11.9% 11.9% 11.9% 11.6% 11.8% 11.6% 11.8% 13.0% 11.2% 11.0% 90.00 9.0% 6.5% 6.4% 6.4% 6.4% 6.7% 6.8% 80.00 6.3% 6.2% 6.0% 7.0% 5.0% 70.00
Slide 13: Conclusions
Conclusions Managing well through this crisis year-to-date – Significant earnings power with ~$7B of net income, despite ~$11B increase in reserves – Solid client engagement across ICG and robust performance in Markets and Inv. Banking – Strong growth in GCB deposits and Asia wealth, albeit with low
Slide 14: Forward-looking statements
Certain statements in this document are “forward-looking statements” within the meaning of the rules and regulations of the U.S. Securities and Exchange Commission (SEC). These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Thes
Slide 15: CITI
CITI
Slide 16: Appendix – Table of Contents
Appendix Table of Contents 17. Citigroup Returns 26. Regional Credit Portfolio 18. Supporting our Employees, Clients & 27. Consumer Drivers Communities 28. Consumer Drivers (continued) 19. Risk & Control Environment is a Strategic Priority 29. Institutional Drivers 20. Citigroup – LTM Efficiency Rat
Slide 17: Citigroup Returns
Citigroup Returns ($B) 3Q’20 Returns Average Average (2) Net Income GAAP ROA Allocated to Common Assets (bps) TCE(3) RoTCE GCB $1.1 $434 97 $34 12.3% ICG 2.9 1,732 66 87 13.2% (1) Corp / Other (1.0) 93 (309) 27 (14.7)% (1) Citigroup $2.9 $2,259 57 $149 7.9% YTD’20 Returns Average Average Net Income
Slide 18: Supporting our Employees, Clients & Communities
Supporting our Employees, Clients & Communities Announced More Than $1B in Strategic Initiatives to Close Racial Wealth Gap and Increase Economic Mobility in the U.S. Areas of Focus Business Growth Affordable Housing Social Justice • $350MM in procurement • $550MM to support homeownership • $100MM i
Slide 19: Risk & Control Environment is a Strategic Priority
Risk & Control Environment is a Strategic Priority Organizational Changes Investments in Infrastructure and Controls • New governance design with centralized • Unified data architecture program management and regulatory affairs throughout organization under newly created Chief Administrative • Using
Slide 20: Citigroup – LTM Efficiency Ratio and Expenses
Citigroup – LTM Efficiency Ratio and Expenses ($B) LTM Efficiency Ratio and Expenses 3Q’20 YTD’20 LTM’20 Operating Efficiency 63.4% 55.3% 55.7% 59.8% 59.3% 59.2% YoY r (bps) 703 (111) (105) 58.5% YoY r ex FX (bps) 673 (112) (109) 58.3% 58.2% 57.9% 57.7% 57.4% 57.2% 56.7% 56.7% 56.5% 55.7% 55.0% 54.1
Slide 21: Estimated FX Impact on Key P&L Metrics
Estimated FX(1) Impact on Key P&L Metrics ($B) Year-over-Year Impact 3Q’20 2Q’20 1Q’20 4Q’19 3Q’19 Revenues $(0.2) $(0.4) $(0.3) $0.0 $(0.2) Expenses (0.0) (0.3) (0.2) 0.0 (0.2) Credit Costs (0.0) (0.1) (0.0) 0.0 (0.0) Earnings Before Taxes $(0.1) $(0.1) $(0.1) $(0.0) $(0.1) 21 Note: Totals may not
Slide 22: Consumer Credit
Consumer Credit (Constant $B) 3Q'20 Loans Growth 90+ DPD Ratio NCL Ratio ($B) (% ) YoY % 3Q'20 2Q'20 3Q'19 3Q'20 2Q'20 3Q'19 Korea 16.9 6.2% 6.9% 0.2% 0.2% 0.2% 0.7% 0.7% 0.6% Singapore 13.2 4.8% 2.9% 0.1% 0.1% 0.1% 0.4% 0.3% 0.3% Hong Kong 13.0 4.8% 1.9% 0.1% 0.1% 0.0% 0.3% 0.3% 0.2% Australia 8.7
Slide 23: ICG – Corporate Credit Exposure
ICG – Corporate Credit Exposure (EOP in $B) Exposures Industry Composition – % of Portfolio Exposure Type 3Q’20 2Q’20 Industry 3Q’20 2Q’20 Direct outstandings(1) $344 $364 Transportation & industrials 19% 19% 430 420 Autos 7 7 Unfunded lending commitments(2) Transportation 4 4 Total $774 $784 Indust
Slide 24: ICG – Corporate Energy Exposure
ICG – Corporate Energy Exposure (EOP in $B) Energy / Energy-Related Exposure Geographic Distribution as of 3Q’20(2) Funded Total Exposure(2) LATAM 8% UK 3Q’20 2Q’20 3Q’20 2Q’20 15% Energy $16.2 $18.7 $51.0 $55.4 EMEA North 13% Energy-Related(1) 3.2 3.4 5.5 5.8 America 56% Asia Total $19.4 $22.1 $56.
Slide 25: ICG – Unfunded Corporate Energy Exposure
ICG – Unfunded Corporate Energy Exposure(1) (3Q’20 EOP in $B) Facility Structure Ratings Detail Key Takeaways 3Q’20 AAA / CCC A• Fronting exposure represents BBB BB / B or Total AA / A below advances to borrowers on behalf of A Fronting Exposure $5.1 0.0 0.0 0.0 $5.2 participating banks B Letters of
Slide 26: Regional Credit Portfolio
Regional Credit Portfolio (3Q’20 EOP in $B) Geographic Loan Distribution Loan Composition Mexico 5% Mortgages Korea 6% Singapore 5% $187 Personal, Small Business & Other Hong Kong 5% 29% Cards Taiwan 3% 2% GCB North America Other EM $85 66% 8% 68% 39% Developed Asia 3% 40% 22% DM EM Hong Kong 5% Pri
Slide 27: Consumer Drivers
Consumer Drivers (1) 3Q'20 2Q'20 1Q'20 4Q'19 3Q'19 YoY QoQ GCB Digital Metrics (MM) North America: Active Digital Customers 19.9 20.0 20.0 19.7 19.3 3% (0)% Active Mobile Customers 12.7 12.7 12.7 12.5 12.2 4% 0% International: Active Digital Customers 13.9 13.5 13.5 13.1 12.6 10% 3% Active Mobile Cu
Slide 28: Consumer Drivers (continued)
Consumer Drivers (continued) Digital / Mobile Customers(1) Agent Contact Rate(2) (MM) Digital Customers Mobile Customers 19% 37% 33.8 (25)% 31.9 24.4 28.5 22.2 1.31 17.8 1.22 0.98 3Q'18 3Q'19 3Q'20 3Q'18 3Q'19 3Q'20 LTM'18 LTM'19 LTM'20 E-Statement Penetration(3) E-Payment Penetration(4) ~600 bps ~6
Slide 29: Institutional Drivers
Institutional Drivers ICG 3Q'20 2Q'20 1Q'20 4Q'19 3Q'19 YoY QoQ (Constant $B) Average Deposits: 937 929 813 794 774 21% 1% NA 488 482 402 392 374 30% 1% EMEA 218 217 198 196 199 9% 0% Latin America 43 40 34 33 32 33% 6% Asia 188 190 179 173 169 12% (1)% EOP Deposits: 925 915 890 764 798 16% 1% NA 47
Slide 30: Equity & CET1 Capital Drivers (QoQ)
Equity & CET1 Capital Drivers (QoQ) ($B, except basis points (bps)) Tangible CET1 Common CET1 Common Capital Equity Capital(2) Equity(1) Ratio(2) (bps) 2Q’20 $173.6 $148.1 $139.6 11.6% Impact of: CECL 25% Provision Deferral(3) N/A N/A 0.1 1 Net Income 3.2 3.2 3.2 27 Preferred Stock Dividends (0.3) (
Slide 31: Equity & CET1 Capital Drivers (YoY)
Equity & CET1 Capital Drivers (YoY) ($B, except basis points (bps)) Tangible CET1 Common CET1 Common Capital Equity Capital(2) Equity(1) Ratio(2) (bps) 3Q’19 $176.9 $150.7 $138.6 11.6% Impact of: CECL Transition Impact(3) (3.1) (3.1) - - CECL 25% Provision Deferral(4) N/A N/A 2.6 22 Net Income 12.0
Slide 32: Common Equity Tier 1 Capital Ratio and Components
Common Equity Tier 1 Capital Ratio and Components ($MM) Common Equity Tier 1 Capital Ratio and Components(1) 3Q'20(2) 2Q'20 1Q'20 4Q'19 3Q'19 Citigroup Common Stockholders' Equity(3) $176,047 $173,793 $174,502 $175,414 $177,052 Add: Qualifying noncontrolling interests 141 145 138 154 145 Regulatory
Slide 33: Supplementary Leverage Ratio; TCE Reconciliation
Supplementary Leverage Ratio; TCE Reconciliation ($MM, except per share amounts) Supplementary Leverage Ratio and Components 3Q'20(1) 2Q'20 1Q'20 4Q'19 3Q'19 Common Equity Tier 1 Capital (CET1) (2) $142,234 $139,643 $136,695 $137,798 $138,581 Additional Tier 1 Capital (AT1)(3) 18,155 17,988 17,609 1
Slide 34: Adjusted Results and FX Impact Reconciliation
Adjusted Results and FX Impact Reconciliation ($MM, except balance sheet items in $B) Citigroup 3Q'20 2Q'20 3Q'19 YTD'20 YTD'19 Latin America Consumer Banking 3Q'20 2Q'20 3Q'19 YTD'20 YTD'19 Reported Net Income $3,230 $1,316 $4,913 $7,068 $14,422 Reported Revenues $1,027 $1,050 $1,269 $3,276 $3,861