Citigroup Earnings and Revenue Light in Challenging Times, Fixed Income Ops Weak

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By Jon C. Ogg Published
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Citigroup Inc. (NYSE: C) reported earnings for the third quarter that just missed expectations on the bottom line and missed handily on revenues on the surface. The money center bank posted $1.02 in earnings per share (EPS), versus estimates of $1.04 EPS, based in part on weakness in fixed income revenue. Excluding CVA/DVA and other non-normalized items, revenue was listed as being down 5% at $18.2 billion, versus estimates of closer to $18.7 billion. Citigroup called the current macro environment challenging and uneven.

One thing that investors will try to focus on is book values, and these were listed as $64.49 per share on a stated book value basis and $54.52 per share on a tangible book value basis. These compare to a closing price of $49.60.

Citi Holdings assets of $122 billion declined by some 29% from the prior year and now represent only 6% of the total Citigroup assets. Other key metrics investors will care about are as follows:

  • Basel III Tier 1 common equity ratio 10.4%
  • Basel I Tier 1 common equity ratio 12.6%
  • Return on assets 0.7%
  • Return on common equity 6.4%
  • Allowance for loan losses was $20.6 billion, or 3.2% of total loans

Citigroup shares are indicated down about 1% at $49.19, and the 52-week trading range is $34.04 to $53.56.

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About the Author Jon C. Ogg →

Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. a673b.bigscoots-temp.com.

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