Banking stock under pressure: Citigroup Inc (NYSE: C)

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Citigroup Inc (NYSE: C) stock lost 0.012% on January 14th, 2020 and continued its bearish momentum on January 14th, 2020, falling over 0.7% in the pre-market session on January 15th, 2020 (Source: Google finance) The bank has, reduced its guidance for 2020 ROTCE to be in a range of 12% to 13%, down from prior guidance of 13.5%. The bank expects expect NCL rates in 2020 to be at or slightly above the high end of the outlook range of 300 basis points to 325 basis points for Branded Cards and 500 basis points to 525 basis points for Retail Services.

For the fourth quarter of FY19, Net income applicable to common shareholders rose to $4.98 billion in the three months ended Dec. 31, from $4.31 billion, a year earlier. Net interest income has risen by 1% at Citi, compared with declines at JPMorgan and Wells Fargo & Co. The bank also achieved the target of a return on tangible common equity (ROTCE) of 12.1% for 2019, which is above the goal of 12% it had promised investors for the year.

Moreover, in constant dollars, end of period loans rose 2% year-over-year to $699 billion as 3% growth in the core businesses was partially offset by the wind down of legacy assets and deposits rose 6% due to the contributions from both the consumer and institutional franchises. Further, in the Consumer business, for the fourth quarter, the company posted the revenues growth of 4% due to contributions from all regions, while expenses had fallen by 1% driving continued growth in operating margin and earnings. For North America Consumer Banking, the company posted the fourth quarter revenues of $5.3 billion, which is up 4% from last year.

Furthermore, Branded Cards revenues were of $2.4 billion, which reflects the growth of 10% year-over-year. Client engagement remained strong with purchase sales up 7% and average loan growth expanded to 4%, while the net interest revenue as a percentage of loans increased to 921 basis points this quarter.  Retail Services revenues of $1.7 billion, which reflects the increase of 1% year-over-year with continued growth in loans and purchase sales across the majority of the portfolio.

C in the fourth quarter of FY19 has reported the adjusted earnings per share of $1.90, while reported the adjusted revenue growth of 7 percent to $18.38 billion in the fourth quarter of FY19

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