Citi sees Q3 increase in markets and securities services revenues
14 October 2020 New York
Image: monsitj/Adobe Stock
Citi has reported markets and securities services revenues for Q3 2020 as $5.2 billion, a 16 percent increase compared to Q3 2019, which stood at $4.5 billion.
Fixed income markets revenues of $3.8 billion increased 18 percent compared to $3.2 billion in Q3 2019, which Citi said was driven by strong performance across spread products and commodities.
Equity markets were also on the up with revenues tapping $875 million compared to $760 million during the same period last year, marking a 5 percent increase.
According to Citi, this boost in equity markets was driven by a solid performance in cash equities and derivatives.
Securities services revenues of $631 million experienced a decline of 5 percent on a reported basis and 4 percent in constant dollars.
Citi explained that this was as higher deposit volumes were more than offset by lower spreads and increased 15 percent, as solid performance in cash equities and derivatives was partially offset.
Elsewhere, overall revenues decreased 7 percent from the prior-year period, primarily reflecting lower revenues in global consumer banking and corporate/other.
This was partially offset by growth in fixed income markets, investment banking, equity markets and the private bank in the Institutional Clients Group (ICG).
Net income declined 34 percent from the prior-year period, largely driven by the lower revenues, an increase in expenses and higher credit costs. Results include a $400 million civil money penalty in connection with consent orders recorded in corporate/other.
Commenting on Citi’s Q3 results, the CEO Michael Corbat, commented: “We continue to navigate the effects of the COVID-19 pandemic extremely well. Credit costs have stabilised; deposits continued to increase, and revenues are up 3 percent year-to-date.”
Corbat also noted: “The backbone of our global network, treasury and trade Solutions experienced strong client engagement in the face of low interest rates. Although global
consumer banking revenues remained lower as a result of the pandemic, we did see higher activity in our mortgage and wealth management products.”
“We are committed to thoroughly addressing the issues contained in the Consent Orders we entered into last week with the Federal Reserve and the Office of the Comptroller of the Currency. These investments will not only further enhance our safety and soundness, but they will also result in a digital infrastructure that will improve our ability to serve our clients and customers and make us more competitive,” Corbat concluded.
Corbat recently announced he will retire from Citi in February 2021 after 37 years of working at the bank.
Succeeding Corbat is Jane Fraser, who has worked at Citi for the last 16 years. Fraser has served in her current role as president and CEO of global consumer banking since 2019.
Fixed income markets revenues of $3.8 billion increased 18 percent compared to $3.2 billion in Q3 2019, which Citi said was driven by strong performance across spread products and commodities.
Equity markets were also on the up with revenues tapping $875 million compared to $760 million during the same period last year, marking a 5 percent increase.
According to Citi, this boost in equity markets was driven by a solid performance in cash equities and derivatives.
Securities services revenues of $631 million experienced a decline of 5 percent on a reported basis and 4 percent in constant dollars.
Citi explained that this was as higher deposit volumes were more than offset by lower spreads and increased 15 percent, as solid performance in cash equities and derivatives was partially offset.
Elsewhere, overall revenues decreased 7 percent from the prior-year period, primarily reflecting lower revenues in global consumer banking and corporate/other.
This was partially offset by growth in fixed income markets, investment banking, equity markets and the private bank in the Institutional Clients Group (ICG).
Net income declined 34 percent from the prior-year period, largely driven by the lower revenues, an increase in expenses and higher credit costs. Results include a $400 million civil money penalty in connection with consent orders recorded in corporate/other.
Commenting on Citi’s Q3 results, the CEO Michael Corbat, commented: “We continue to navigate the effects of the COVID-19 pandemic extremely well. Credit costs have stabilised; deposits continued to increase, and revenues are up 3 percent year-to-date.”
Corbat also noted: “The backbone of our global network, treasury and trade Solutions experienced strong client engagement in the face of low interest rates. Although global
consumer banking revenues remained lower as a result of the pandemic, we did see higher activity in our mortgage and wealth management products.”
“We are committed to thoroughly addressing the issues contained in the Consent Orders we entered into last week with the Federal Reserve and the Office of the Comptroller of the Currency. These investments will not only further enhance our safety and soundness, but they will also result in a digital infrastructure that will improve our ability to serve our clients and customers and make us more competitive,” Corbat concluded.
Corbat recently announced he will retire from Citi in February 2021 after 37 years of working at the bank.
Succeeding Corbat is Jane Fraser, who has worked at Citi for the last 16 years. Fraser has served in her current role as president and CEO of global consumer banking since 2019.
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J.P. Morgan reports rise in markets and securities services revenue for Q3
J.P. Morgan reports rise in markets and securities services revenue for Q3
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