Amidst strong global economic headwinds that include concerns over near-zero interest rates, a slowdown in China and decade low oil prices, many of the global banks, and especially large banks based in the US have had a tough start to the year.
Citigroup seems to be the latest casualty to this phenomenon.
The investment banking revenue of Citibank slumped 27.2 percent to $875 million, the bank also noted a drop in its revenue from fixed income markets by 11.5 percent to touch $3.09 billion.
"While our market-sensitive products clearly suffered from weak investor sentiment during the quarter, we continued to make progress in several key areas," Chief Executive Michael Corbat said in a statement.
There was however a fall in operating expenses which declined by 3.3 percent to reach $10.5 billion.
As revenue growth remains sluggish, over the past several quarters, Citibank, in a strategy similar to rivals such as JPMorgan Chase & co and Bank of America Corp, has resorted to aggressive cost controls to underpin earnings.
In order to become more efficient, Citigroup has been exiting less profitable markets and cutting jobs to become more efficient. The bank has been more active in the emerging markets and at present it has more assets in emerging markets than other U.S. banks. The company recorded $491 million in so-called "repositioning" charges.
Regulators have very recently identified and applauded Citibank with a huge endorsement and said that the bank was the only one of eight reviewed to have a credible plan to deal with a potential bankruptcy that did not rely on public money. While this was a shot in the arm for the bank, the latest results could prove to be a damper coming just two days after huge endorsement.
The U.S. Federal Reserve has been in the process of stress-testing big banks, to return more money to shareholders and the endorsement gave investors reason to believe that Citigroup will win approval in June from the U.S. Federal Reserve.
Beating the average analyst estimate of earnings of $1.03 per share, according to Thomson Reuters I/B/E/S, Citigroup's net income fell to $3.5 billion, or $1.10 per share, in the first quarter ended March 31.
Revenue fell 11 percent to $17.56 billion, topping the average estimate of $17.48 billion.
(Source:www.reuters.com)
Citigroup seems to be the latest casualty to this phenomenon.
The investment banking revenue of Citibank slumped 27.2 percent to $875 million, the bank also noted a drop in its revenue from fixed income markets by 11.5 percent to touch $3.09 billion.
"While our market-sensitive products clearly suffered from weak investor sentiment during the quarter, we continued to make progress in several key areas," Chief Executive Michael Corbat said in a statement.
There was however a fall in operating expenses which declined by 3.3 percent to reach $10.5 billion.
As revenue growth remains sluggish, over the past several quarters, Citibank, in a strategy similar to rivals such as JPMorgan Chase & co and Bank of America Corp, has resorted to aggressive cost controls to underpin earnings.
In order to become more efficient, Citigroup has been exiting less profitable markets and cutting jobs to become more efficient. The bank has been more active in the emerging markets and at present it has more assets in emerging markets than other U.S. banks. The company recorded $491 million in so-called "repositioning" charges.
Regulators have very recently identified and applauded Citibank with a huge endorsement and said that the bank was the only one of eight reviewed to have a credible plan to deal with a potential bankruptcy that did not rely on public money. While this was a shot in the arm for the bank, the latest results could prove to be a damper coming just two days after huge endorsement.
The U.S. Federal Reserve has been in the process of stress-testing big banks, to return more money to shareholders and the endorsement gave investors reason to believe that Citigroup will win approval in June from the U.S. Federal Reserve.
Beating the average analyst estimate of earnings of $1.03 per share, according to Thomson Reuters I/B/E/S, Citigroup's net income fell to $3.5 billion, or $1.10 per share, in the first quarter ended March 31.
Revenue fell 11 percent to $17.56 billion, topping the average estimate of $17.48 billion.
(Source:www.reuters.com)