Citigroup, Inc. · NYSE:C
Citigroup — Q3 2024 Earnings Presentation
42 slides from Citigroup's earnings presentation, Oct 15, 2024
Slide 1: Earnings Results Presentation Third Quarter 2024
October 15, 2024 Earnings Results Presentation Third Quarter 2024
Slide 2: 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 3: Progress against our priorities in third quarter 2024
Progress against our priorities in third quarter 2024 Transformation Strategic Execution Organization, Culture and Talent • Closed the 2013 BSA/AML Consent Order Strategy: • Hired Achintya Mangla as Head of with the FRB • Record quarter in Services, with growth driven by fees, loans and Financing fo
Slide 4: Third quarter 2024 results snapshot
Third quarter 2024 results snapshot Revenues Net Income EPS 3Q24 $20.3 billion 3Q24 $3.2 billion 3Q24 $1.51 ∆ 3Q23 1% ∆ 3Q23 (9)% ∆ 3Q23 (7)% RoTCE(1) CET1 Capital Ratio(2) Tangible Book Value Per Share(3) 3Q24 7.0% 3Q24 13.7% 3Q24 $89.67 3Q23 7.7% 3Q23 13.6% ∆ 3Q23 3% Third Quarter Key Highlights S
Slide 5: Financial results overview
Financial results overview Financial Results 3Q24 Financial Overview Highlights ($ in MM, except EPS) 3Q24 % Δ QoQ % Δ YoY YTD '24 % Δ YoY • Revenues – Up 1% YoY. Excluding divestiture-related impacts, revenues were up Net Interest Income 13,362 (1)% (3)% 40,362 (2)% 3% YoY (7), driven by growth acr
Slide 6: Expense overview
Expense overview Quarterly Expense Trend Recent Expense Drivers Reported $13.5B $16.0B $14.2B $13.4B $13.3B Expenses Growth driven by investments to modernize Citi’s Reported Transformation Expenses ex- infrastructure, automate manual processes and Divestitures & Investments $13.4B $14.2B $13.8B $13
Slide 7: Net interest income, average loans and deposits
Net interest income, average loans and deposits ($ in B) Net Interest Income 2.49% 2.46% 2.42% QoQ YoY 2.41% 2.33% Citigroup NIM $(0.13) $(0.47) $13.83 $13.82 $13.51 $13.49 $13.36 Markets NII 1.70 1.99 1.71 2.04 1.41 $(0.63) $(0.29) NII 12.13 11.83 11.80 11.96 $0.50 $(0.18) 11.46 ex-Markets(1) 3Q23
Slide 8: U.S. cards and corporate credit overview
U.S. cards and corporate credit overview ($ 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, 11% Branded 68% 68% 68% Cards IG 83% 82% 81% ≥ 660 86% 86% 85% International 43% IG / MNCs or U.S. sub
Slide 9: 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 3Q23 2Q24 3Q24 QoQ YoY $2,368 $2,406 $2,431 1% 3% CET1 Capital 156 154 158 246 303 Cash 254 23% 19% Standardized RWA 1,149 1,136 1,153 Investments, 509 508 491 (3)% (4)% CET1 Capital
Slide 10: Standardized CET1 Capital ratio overview
Standardized CET1 Capital ratio overview 3Q24 QoQ Standardized CET1 Capital Ratio Walk CET1 Standardized Regulatory Capital Requirement Key drivers resulting in CET1 Capital ratio of 13.7%(1) • Well capitalized today with a CET1 Capital ratio of 13.7%(1), ~140bps above the 3Q24 regulatory capital re
Slide 11: Services results, key metrics and statistics
Services results, key metrics and statistics Financial Results Highlights ($ in MM) 3Q24 % Δ QoQ % Δ YoY • Revenues – Up 8% YoY, reflecting continued momentum across Securities Net Interest Income 2,731 4% (5)% Services and TTS Non-Interest Revenue 909 13% 41% ‒ NII roughly flat, as the benefit of h
Slide 12: Markets results, key metrics and statistics
Markets results, key metrics and statistics Financial Results Highlights ($ in MM) 3Q24 % Δ QoQ % Δ YoY • Revenues – Up 1% YoY, driven by growth in Equity markets, partially offset by Rates and Currencies 2,465 - (10)% a decline in Fixed Income markets Spread Products / Other Fixed Income 1,113 1% 5
Slide 13: Banking results, key metrics and statistics
Banking results, key metrics and statistics Financial Results Highlights ($ in MM) 3Q24 % Δ QoQ % Δ YoY • Revenues – Up 16% YoY, largely driven by growth in Investment Banking Investment Banking 934 9% 31% Corporate Lending (ex-gain/(loss))(1) ‒ Investment Banking revenues were up 31% and fees were
Slide 14: Wealth results, key metrics and statistics
Wealth results, key metrics and statistics Financial Results Highlights ($ in MM) 3Q24 % Δ QoQ % Δ YoY • Revenues – Up 9% YoY, driven by: Private Bank 614 - - ‒ A 15% increase in NIR driven by higher investment fee revenues on Wealth at Work 244 25% 4% momentum in client investment assets (up 24% Yo
Slide 15: U.S. Personal Banking results, key metrics and statistics
U.S. Personal Banking results, key metrics and statistics Financial Results Highlights ($ in MM) 3Q24 % Δ QoQ % Δ YoY • Revenues – Up 3% YoY, driven by NII growth of 2% due to loan growth in cards Branded Cards 2,731 8% 8% as well as lower partner payments Retail Services 1,715 (2)% (1)% Retail Bank
Slide 16: All Other (Managed Basis) results, key metrics and statistics
All Other (Managed Basis(1)) results, key metrics and statistics Financial Results Highlights ($ in MM) 3Q24 % Δ QoQ % Δ YoY • Revenues – Down (18)% YoY, primarily driven by closed exits and wind-downs Legacy Franchises (managed basis) 1,739 1% (6)% as well as margin compression on mortgage securiti
Slide 17: Full year 2024 guidance and medium-term targets
Full year 2024 guidance and medium-term(1) targets Full Year 2024 Guidance Underlying Drivers of Medium-Term(1) Targets • Full year revenues: ~$80-81 billion • NIR driven by • 4-5% revenue CAGR as we continue to execute our strategy in ‒ Fee growth in Services, driven by client wins and deepening of
Slide 18: Forward-looking statements
Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. These statements are not g
Slide 19: Slide 19
Slide 20: Credit Trends for Branded Cards and Retail Services
Credit Trends for Branded Cards and Retail Services ($ in B) Branded Cards Retail Services 90+DPD NCL EOP 1Q24 2Q24 3Q24 EOP 1Q24 2Q24 3Q24 Loans $108.0 $111.8 $112.1 90+DPD NCL Loans $50.8 $51.7 $51.6 3.82% 3.65% 3.56% 6.45% 6.32% 6.14% 3.06% 5.44% 2.72% 2.47% 4.46% 4.53% 2.18% 4.08% 1.68% 3.30% 1.
Slide 21: Citi's net investment in Argentina
Citi’s net investment in Argentina • Citi has operated in Argentina for over 100 years and currently serves approximately 1,300 clients, including approximately 700 multinational clients • Generally, Citi supports these clients in Argentina as part of a broader institutional relationship which spans
Slide 22: Update on Russia exposure and net investment
Update on Russia exposure and net investment • Citi ended nearly all of the institutional banking services offered in Russia as of March 31, 2023 • Largely completed wind-downs of Citi’s consumer and local commercial banking businesses • Remaining services are only those necessary to fulfill our rem
Slide 23: Historical average deposit growth
Historical average deposit growth ($ in B) Total CAGR: 4.9% Services CAGR: 5.9% 1,370 1,305 1,304 1,321 1,343 1,334 1,323 1,316 1,361 1,363 1,338 1,315 1,320 1,326 1,310 1,311 1,268 110 90 112 106 1,234 116 88 101 100 103 105 102 97 85 129 128 123 125 114 118 116 111 111 113 85 1,115 122 114 115 110
Slide 24: YTD'24 Financial Summary of Businesses
YTD’24 Financial Summary of Businesses ($ in B) All Other YTD'24 Services Markets Banking Wealth USPB (1) Reconciling Items(2) Total (Managed Basis) $ in billions $ YoY Δ (%) $ YoY Δ (%) $ YoY Δ (%) $ YoY Δ (%) $ YoY Δ (%) $ YoY Δ (%) $ YoY Δ (%) $ YoY Δ (%) Net Interest Income $9,977 2% $5,149 (2)%
Slide 25: Tangible common equity reconciliation and Citigroup returns
Tangible common equity reconciliation and Citigroup returns ($ in MM, except per share amounts) Tangible Common Equity and Tangible Book Value Per Share Return on Tangible Common Equity (RoTCE) 3Q24 2Q24 3Q23 3Q24 3Q23 YTD'24 Common Stockholders' Equity $192,733 $190,210 $190,008 Citigroup Net Incom
Slide 26: FX impact
FX impact ($ in MM) Total Citigroup Legacy Franchises – Mexico Consumer / SBMM Foreign currency (FX) translation impact(1) 3Q24 2Q24 3Q23 QoQ YoY Foreign currency (FX) translation impact(1) 3Q24 2Q24 3Q23 QoQ YoY Total Revenues - as Reported 20,315 20,139 20,139 1% 1% Mexico Revenues - as reported 1
Slide 27: Reconciliation of adjusted results
Reconciliation of adjusted results ($ in MM) Total Citigroup Revenues, Net Interest Income, Non-Interest Revenues and Expenses 3Q24 3Q24 2Q24 1Q24 4Q23 3Q23 % Δ QoQ % Δ YoY YTD '24 YTD '23 % Δ YoY Total Citigroup Revenues - As Reported $20,315 $20,139 $21,104 $17,440 $20,139 1% 1% $61,558 $61,022 1%
Slide 28: Reconciliation of adjusted results (cont.)
Reconciliation of adjusted results (cont.) ($ in MM) Services Non-Interest Revenues (NIR) - Excluding Argentine peso devaluation 3Q24 3Q24 2Q24 1Q24 4Q23 3Q23 % Δ QoQ % Δ YoY YTD '24 YTD '23 % Δ YoY Total Services Non-Interest Revenues (NIR) - As Reported $1,593 $1,455 $1,449 $1,075 $1,196 9% 33% $4
Slide 29: All Other (Managed Basis) Trend
All Other (Managed Basis(1)) Trend All Other (Managed Basis) 3Q24 2Q24 3Q23 QoQ% YoY% ($ in millions, except as otherwise noted) Legacy Franchises (Managed Basis) 1,739 1,727 1,841 1% (6)% Corporate / Other 86 253 397 (66)% (78)% Total revenues 1,825 1,980 2,238 (8)% (18)% Total operating expenses 2
Slide 30: Reconciliation of adjusted results (cont.)
Reconciliation of adjusted results (cont.) ($ in MM) All Other (Managed Basis(1)) 3Q24 2Q24 3Q23 % Δ QoQ % Δ YoY All Other Revenues, Managed Basis $1,825 $1,980 $2,238 (8)% (18)% Add: All Other Divestiture-related Impact on Revenue(2) $1 $33 $396 All Other Revenues, (U.S. GAAP) $1,826 $2,013 $2,634
Slide 31: Glossary
Glossary ACL: Allowance for Credit Losses CTA: Cumulative Translation IB: Investment Banking RoTCE: Return on Average Tangible Adjustment Common Equity ACLL: Allowance for Credit Losses on IG: Investment Grade Loans DCM: Debt Capital Markets SBMM: Small Business and Middle LCR: Liquidity Coverage Ra
Slide 32: Footnotes
Footnotes Slide 2 1) Represents consumer banking businesses across 14 markets in Asia, Europe, the Middle East and Mexico as part of Citi’s strategic refresh. Slide 3 1) Wallet share based on Dealogic data as of September 30, 2024; wallet share for Debt Capital Markets includes Leveraged Finance and
Slide 33: Footnotes (cont.)
Footnotes (cont.) Slide 5 1) Allowance for Credit Losses (ACL) Build (Release) and Other provisions includes a net ACL build of approximately $315 million related to loans and unfunded lending commitments as well as other provisions of approximately $188 million relating to held-to-maturity (HTM) de
Slide 34: Footnotes (cont.)
Footnotes (cont.) Slide 7 1) NII excluding Markets is a non-GAAP financial measure. For reconciliation of these results, please refer Slide 27. 2) Gross Loan Yield is defined as gross interest revenue earned on loans divided by average loans. 3) Cost of Interest-Bearing Deposits is defined as intere
Slide 35: Footnotes (cont.)
Footnotes (cont.) Slide 11 1) Allowance for Credit Losses (ACL) Build (Release) and Other provisions includes a net ACL build of approximately $14 million related to loans and unfunded lending commitments as well as other provisions of approximately $99 million relating to held-to-maturity (HTM) deb
Slide 36: Footnotes (cont.)
Footnotes (cont.) Slide 13 1) Credit derivatives are used to economically hedge a portion of the Corporate Lending portfolio that includes both accrual loans and loans at fair value. Gain / (loss) on loan hedges includes the mark- to-market on the credit derivatives and the mark-to-market on the loa
Slide 37: Footnotes (cont.)
Footnotes (cont.) Slide 15 1) Allowance for Credit Losses (ACL) Build (Release) and Other provisions includes a net ACL build of approximately $41 million related to loans and unfunded lending commitments as well as other provisions of approximately $4 million relating to benefits and claims, and ot
Slide 38: Footnotes (cont.)
Footnotes (cont.) Slide 16 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 39: Footnotes (cont.)
Footnotes (cont.) Slide 17 1) Defined as 2026. 2) Full year 2024 NII ex-Markets and management’s expectation for 4Q24 NII ex-Markets to be roughly flat sequentially are forward-looking non-GAAP financial measures. From time to time, management may discuss forward-looking non-GAAP financial measures,
Slide 40: Footnotes (cont.)
Footnotes (cont.) Slide 24 1) All Other (Managed Basis) is a non-GAAP financial measure. 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
Slide 41: Footnotes (cont.)
Footnotes (cont.) Slide 27 1) Divestiture-related impacts in 2024: • 1Q24 includes approximately $110 million in operating expenses (approximately $77 million after-tax), primarily related to separation costs in Mexico and severance costs in the Asia exit markets. • 2Q24 includes approximately $85 m
Slide 42: Footnotes (cont.)
Footnotes (cont.) Slide 28 1) Argentine peso devaluations-related impacts in 2024: • 1Q24 includes approximately $39 million loss of non-interest revenue due to the impact of the Argentine peso devaluations. • 2Q24 includes approximately $46 million loss of non-interest revenue due the impact of the