CITIGROUP INC Quarterly Report for Q1 Ended Mar 31, 2022

Summary

Citigroup Inc. (C) reported its first quarter 2022 financial results, showing a 2% decrease in total revenues to $19.2 billion compared to the prior year, primarily due to lower non-interest revenue. Net income declined significantly by 46% to $4.3 billion, or $2.02 per diluted share, driven by higher cost of credit and operating expenses, partly offset by a lower effective tax rate. The company continued to invest in its transformation and risk management, including setting aside approximately $1.9 billion for potential credit losses related to Russia and the war in Ukraine. Despite the revenue and net income decline, Citigroup demonstrated solid loan and deposit growth across its Institutional Clients Group (ICG) and Personal Banking and Wealth Management (PBWM) segments and returned approximately $4 billion in capital to shareholders through dividends and share repurchases. The company is also progressing with its strategic refresh, including divesting several consumer banking franchises in Asia and EMEA. Geopolitical and macroeconomic uncertainties, including the war in Ukraine, supply chain disruptions, and inflationary pressures, are noted as ongoing challenges that could impact future results. The Institutional Clients Group (ICG) saw revenues decline by 2% due to lower Banking and Markets revenues, although Services revenues increased by 15%. Personal Banking and Wealth Management (PBWM) revenues decreased by 1%, impacted by lower non-interest revenue. Legacy Franchises reported a net loss of $383 million, reflecting lower revenues and higher expenses, largely due to divestiture-related costs. The CET1 capital ratio stood at 11.4%, slightly down from the prior year but well above regulatory minimums.

Key Highlights

• 1Total revenues decreased by 2% year-over-year to $19.2 billion, primarily driven by lower non-interest revenue.
• 2Net income fell by 46% to $4.3 billion ($2.02 per diluted share) compared to the prior year, impacted by higher credit costs and expenses.
• 3The company announced a $1.9 billion provision for credit losses, largely attributed to exposures in Russia and the war in Ukraine.
• 4Citigroup returned approximately $4 billion of capital to shareholders through dividends and share repurchases.
• 5Operating expenses increased by 15% to $13.2 billion, including $535 million in goodwill impairment charges related to Asia Consumer divestitures.
• 6The Common Equity Tier 1 (CET1) capital ratio was 11.4% as of March 31, 2022, a slight decrease from the prior year.
• 7Progress continues on strategic exits, with sale agreements signed for an additional seven consumer banking franchises in Asia and EMEA.

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