Following strong reports from JPMorgan (JPM, Financial) and Wells Fargo (WFC, Financial) last week, shares of major U.S. bank Citigroup Inc. (C, Financial) fell in premarket trading on Monday after reporting tepid first-quarter 2019 results.
The New York-based bank posted 11% earnings growth to $1.87 per share, topping Refinitiv’s estimates of $1.80. Revenue declined 2% from the prior-year quarter to $18.57 billion, just shy of expectations of $18.63 billion.
While earnings were boosted by $4.06 billion in share buybacks, the bank’s revenue was impacted by a 24% decrease in equity trading.
Equity trading revenue came in at $842 million as a result of lower market volumes and client financing balances, which was partially offset by a 20% increase in investment banking revenue to $1.35 billion. Fixed-income, currencies and commodities trading revenue also grew 1% to $3.45 billion, ahead of Refinitiv’s projections of $3.05 billion.
In a statement, CEO Michael Corbat said the bank’s earnings reflect its “steady progress towards our financial targets” of improving return on and return of capital.
“Both our consumer and institutional businesses performed well and we saw good momentum in those areas where we have been investing, such as U.S. Branded Cards, Treasury and Trade Solutions, and Investment Banking,” he said. “Importantly, our strategy in North America consumer banking is showing good early results as we introduce new products and engage with a broader range of customers, through digital channels.”
During the quarter, Citigroup also returned $1.08 billion to shareholders through dividend payments.
With a market cap of $157.35 billion, Citigroup shares were down 1.16% at $66.64 on Monday morning. After tumbling 30% in 2018, GuruFocus estimates the stock has climbed 29% year to date.
Investment bank Goldman Sachs (GS, Financial) also posted earnings on Tuesday. Bank of America Corp. (BAC, Financial) is scheduled to report earnings before the opening bell on April 16.
According to the industry overview page, Citigroup is the fourth-largest U.S. bank with a weight of 8.4%.
Disclosure: No positions.
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