Citigroup Inc (NYSE: C) stock fell over 0.4% in the pre-market session of July 16th, 2019 (Source: Google finance). For the second quarter of 2019, fixed-income revenue rose 8% to $3.32 billion, but excluding the Tradeweb transaction, the bank would have posted a 4% decline in that division. Investment banking revenue dropped 10% to $1.28 billion.
The firm is expected to gain from the initial public offering of electronic bond trading platform Tradeweb. Other banks should also benefit from the IPO of Tradeweb, whose investors included the biggest U.S. banks, such as Goldman Sachs and Bank of America. Tradeweb, founded in 1996, went public in April in what was then second-biggest IPO of the year. Citigroup net income of $4.8 billion in the second quarter 2019 rose 7%, driven by the higher revenues, the reduction in expenses and the lower effective tax rate, partially offset by the higher cost of credit. Citigroup’s effective tax rate was 22% in the current quarter compared to 24% in the second quarter 2018.
Additionally, Citigroup’s book value per share of $79.40 and tangible book value per share of $67.64, both as of quarter end, increased 10% from the prior year, driven by net income and the lower share count. At quarter end, Citigroup’s CET1 Capital ratio was 11.9%, unchanged from the prior quarter, as net income was offset by common share repurchases and dividends. Citigroup’s SLR for the second quarter 2019 was 6.4%, unchanged from the prior quarter. During the second quarter 2019, Citigroup repurchased 54 million common shares and returned a total of $4.6 billion to common shareholders in the form of common share repurchases and dividends.
C in the second quarter of FY 19 has reported the adjusted earnings per share of $1.95, while adjusted revenue growth of 2 percent to $18.76 billion in the second quarter of FY 19. The bank cut companywide expenses 2% to $10.5 billion, and its efficiency ratio improved to 56% from 58% a year ago. That beat the 57.3% estimate of analysts. Revenue in Citigroup’s global consumer bank rose 3% to $8.5 billion as profit climbed 11% to $1.41 billion, compared to the $1.49 billion estimate of analysts surveyed by Factset.