Citigroup Inc (NYSE:C) swung to a fourth-quarter loss after it booked several extraordinary charges and hiked its reserves due to its non-US exposures.
The banking group reported a 3.3% decline in revenue to $17.4 billion for the three months to end December 2023. It swung to a net loss of $1.8 billion, from net income of $2.5 billion a year earlier.
That resulted in a loss per share of $1.16, from earnings per share (EPS) of $1.16.
The company cited expenses of roughly $1.7 billion associated with a Federal Deposit Insurance Corporation (FDIC) assessment following the small banks’ crisis of early 2023, a reserve build of $1.3 billion associated with transfer risk in Russia and Argentina, the $880 million impact of the devaluation of the Argentine peso, and a restructuring charge of $780 million for the losses.
Taken together, these items stripped about $2 from its diluted EPS. Excluding them, diluted EPS would have amounted to $0.84, the lender said.
“While the fourth quarter was very disappointing due to the impact of notable items, we made substantial progress simplifying Citi and executing our strategy in 2023,” Citi CEO Jane Fraser said in a statement.
“Revenue ex-divestitures grew by 4% and we met our full-year expense guidance.”
Fraser highlighted a 16% increase in services revenue over the quarter due to market share gains and client wins.
In its Markets business, its Fixed Income business posted disappointing results due to a significant slowdown in 4Q, while Equities, particularly Derivatives, had a decent quarter.
Investment Banking revenue continued to be impacted by a weak wallet globally while activity picked up in the fourth quarter with revenues up 27%.
“Given how far we are down the path of our simplification and divestitures, 2024 will be a turning point as we’ll be able to completely focus on the performance of our five businesses and our Transformation,” Fraser added.
After 1.8% on Thursday after warning of the additional charges, Citi’s shares were up 2.1% at $52.08 ahead of the opening bell on Friday.