Citi marks drop in Markets revenues in Q3 2022
Citigroup Inc (NYSE:C) today reported its financial results for the third quarter of 2022, with the institutional business marking a slight decrease in revenues from the year-ago quarter.
Institutional Clients Group (ICG) revenues for the period amounted to $9.5 billion, down 5% (including gain/(loss) on loan hedges), as strong revenue growth in Services was more than offset by lower revenues across Markets and Banking.
Citi’s ICG business reported Services revenues of $4.2 billion, an increase of 33%. Treasury and Trade Solutions (TTS) revenues of $3.2 billion increased 40%, driven by 61% growth in net interest income and 8% growth in non-interest revenue. Strong performance in TTS was driven by business actions, which included managing deposit repricing, deepening of relationships with existing clients, and significant new client wins across all segments, as well as the benefit of higher interest rates.
Securities Services revenues of $968 million increased 15%, as net interest income increased 73%, driven by higher interest rates across currencies, partially offset by a 6% decrease in non-interest revenue due to the impact of market valuations.
Markets revenues of $4.1 billion were down 7%, largely due to lower client activity levels in Equity Markets and spread products, and the optimization of RWA. Fixed Income Markets revenues of $3.1 billion increased 1%, as strength in rates and currencies was largely offset by continued headwinds in spread products. Equity Markets revenues of $1.0 billion were down 25%, primarily reflecting reduced client activity in equity derivatives relative to a very strong quarter in the prior-year period.
Across all segments, Citigroup reported net income for the third quarter 2022 of $3.5 billion, or $1.63 per diluted share, on revenues of $18.5 billion. This compares to net income of $4.6 billion, or $2.15 per diluted share, on revenues of $17.4 billion for the third quarter 2021.
Third quarter results included Asia Consumer divestiture-related impacts of approximately $520 million in earnings before taxes (approximately $256 million after-tax), primarily driven by a gain on the sale of the Philippines consumer business. Excluding these divestiture-related impacts, earnings per share was $1.505.