Citi swings to $1.8 billion loss on charges, calls 2024 'turning point'
By Tatiana Bautzer and Manya Saini
-Citigroup reported a $1.8 billion loss for the fourth quarter on charges to refill a government deposit insurance fund and other one-off costs, and said it expects to further reduce its headcount.
Shares in the bank climbed 3% in premarket trading on Friday after CEO Jane Fraser described 2024 as a «turning point year» for the lender.
«We made substantial progress simplifying Citi and executing our strategy in 2023,» she said in a statement.
Fraser has rolled out a multi-year effort at the third-largest U.S. lender by assets to cut bureaucracy, increase profits and boost a stock that has lagged peers.
«Citigroup's earnings looked awful with a big loss of $1.8 billion, but the bank's underlying business showed resilience. The loss was largely due to exceptional items, as well as a big increase in reserves for credit losses,» said Octavio Marenzi, CEO, management consultancy firm Opimas LLC.
The bank announced it will reduce its headcount by 20,000 people over the medium term, the first time it estimated the workforce effect of its reorganization plan.
Citi said it expects to book charges between $700 million and $1 billion tied to the severance and reorganization.
The bank posted a loss of $1.16 per share for the three months ended Dec. 31. The results were eroded by $3.8 billion in combined charges and reserves that Citigroup disclosed in a filing on Wednesday.
The fourth-quarter loss was also fueled by the bank stockpiling money to cover currency risks in Argentina and Russia.
Rivals JPMorgan Chase (NYSE:JPM) and Bank of America on Friday reported lower quarterly profits, while Wells Fargo outperformed on cost cuts.
Citi's revenue fell 3% to $17.4 billion in the quarter from
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