- The company’s institutional revenue dropped 9% in the quarter.
- The low performance led Citi to announce job cuts last month.
Citigroup released its financial results for the second quarter of the year on Friday, disclosing a decline in profit and revenue during the period. The banking giant has attributed the low performance to a challenging macroeconomic activity and the impact of the US debt limit.
Citi’s net income in the second quarter dropped 39% to USD2.9 billion compared to USD4.5 billion reported in the same period of last year. Similarly, earnings per share declined 39% to USD1.33, while the revenue dropped 1% to USD19 billion.
Commenting about the financial report, Citi’s CEO, Jane Fraser, said: “Markets revenues were down from a strong second quarter last year, as clients stood on the sidelines starting in April while the US debt market played out. In banking, the long-awaited rebound in investment banking has yet to materialize, making for a disappointing quarter.”
The group’s institutional clients group (ICG) reported revenues of $10.4 billion in the second quarter of the year, representing a decline of 9% compared to the corresponding period of last year.
Citigroup’s Job Cuts
The slowdown in business led Citi to announce plans to lay off as many as 5,000 staff in June, the Financial Times reported. As a result of the layoffs, the company’s operating expenses increased by 9% to $13 billion. However, part of the expenses were offset by productivity savings and a reduction in expenses from the exited markets, Citi explained.
However, the bank’s revenue for personal banking and wealth management increased to USD 6 billion in the period due to sustained loan book growth. Besides that, Citi returned USD 2 billion to shareholders through common dividends and share buyback in the period.
