Key facts
- Citigroup's third-quarter profit rose 40% to $5.25 billion, or $2.85 per share.
- Investment banking revenue increased 9% year-over-year to $1.35 billion.
- Services revenue grew 15% and profit grew 27% in the third quarter.
- Wealth management revenue increased 15%, with client assets growing by the same percentage.
- Trading profits rose 2% year-over-year but fell 27% from the previous quarter.
- Citigroup's return on tangible common equity was 11.5% in the third quarter.
Citigroup's third-quarter profit increased by 40% compared to the previous year, reaching $5.25 billion, or $2.85 per share. This growth was primarily driven by stronger performance in its investment banking, services, and wealth management divisions. The bank reported a 9% rise in investment banking revenue to $1.35 billion, while services and wealth management revenues each grew by 15%.
Despite a volatile market backdrop influenced by rising oil prices and interest rate hikes, Citigroup posted an 11.5% return on tangible common equity, surpassing its 11% target. However, trading profits saw a more modest 2% gain year-over-year and a 27% decline from the second quarter, largely due to a drop in equity trading revenue. Profit from credit cards decreased by 8% year-over-year, attributed to higher reward costs, partner payments, and increased credit provisions.
The New York-based bank is nearing the end of a multi-year restructuring aimed at simplifying its organization and addressing compliance and data deficiencies. Citigroup also returned $4.1 billion to shareholders through buybacks and dividends in the third quarter. Rival banks JPMorgan Chase and Wells Fargo also reported profit increases in their third-quarter results.