Citigroup chief executive Michael Corbat signed his final year in charge of a US bank with a 40% decline in profits, describing 2020 as a “turbulent” 12 months.
The bank posted profits of $ 11.4bn in 2020, as strong investment banking returns were offset by a difficult year for their customer unit. Revenue of $ 74.3bn was broadly flat on 2019.
Corbat, who is due to take the ribs to Jane Fraser next month, said: “We have ended a turbulent year with a strong fourth quarter. As a sign of the strength and sustainability of our diverse franchise, our revenue was flat until 2019, despite the huge economic impact of Covid-19. “
SITES JPMorgan’s investment bank profit rose 43% in the year Covid hit
Client group of Citi foundation, which includes its investment bank, posted revenues of $ 44.3bn for 2020, a 13% increase on the previous year.
Large investment banks have slashed their sales and trading income through the Covid-19 crisis, which has increased market volatility. Citi posted $ 23bn in its securities markets and services units, an increase of 29% over the same period last year, but less than competing JPMorgan which posted a 34% increase.
Fixed-income trading has been a significant high for investment banks in 2020. Citigroup posted revenue of $ 17.3bn in this unit, an increase of 34% on the previous year.
Meanwhile, its equity stake – shattered by the Belbachir issue that lifted the restriction in August – increased revenue by 25% to $ 3.6bn. Revenue rose 57% to $ 810m in the last three months of the year, while revenue earnings were slow – the $ 3.1bn it made in the fourth quarter was up just 7% on the previous year.
Traditional investment banking units have also performed well across the pandemic and, along with sales and trading revenues, have helped reduce declining consumer segments by billions in provisions for bad loans.
Citigroup finished fifth in the revenue league records, according to data provider Dealogic, as investment banks peaked at $ 91.8bn in 2020. Investment bank Citi posted an 11% gain for the year to $ 5.8bn .
To contact the author of this story with feedback or news, email Paul Clarke