Citigroup's Q4 2024 Earnings: Strong Net Income Growth and Strategic Progress

Citigroup Inc (C) reported its fourth-quarter 2024 earnings on Wednesday, January 15, 2025, ahead of Wall Street's opening bell, beating estimates on both the top and bottom lines. The bank's shares rose more than 2% in premarket trading following the results. This article will delve into the key highlights of Citigroup's Q4 2024 earnings call, focusing on the company's strong net income growth and strategic progress.



Strong Net Income Growth

Citigroup's net income for the fourth quarter of 2024 was $2.86 billion, a significant turnaround from a net loss of $1.84 billion in the same quarter of the previous year. Diluted earnings per share (EPS) climbed to $1.34 from a loss of $1.16, surpassing the consensus estimate of $1.22. The bank's revenue, net of interest expense, rose 12% year-over-year to $19.58 billion, topping estimates of $19.49 billion. Citigroup's strong performance was driven by a reduced cost of credit, which fell 27% from a year earlier to $2.59 billion, helping to boost net income.



Strategic Progress

Citigroup's CEO, Jane Fraser, highlighted the company's strategic focus on core businesses as a key driver of its financial performance in 2024. The company's five core businesses – Services, Markets, Equities, Banking, and Wealth – each generated positive operating leverage for the full year, contributing to the firm's overall growth. Some notable achievements include:

1. Services: The Services segment had another record year, with revenues up 9% despite a low-rate environment. Citigroup grew its share in both Treasury and Trade Solutions (TTS) and securities services, demonstrating the effectiveness of its strategic focus on this core business.
2. Markets: The Markets franchise performed well in a low-volatility year, with revenues up 6%. This strong performance showcases the benefits of Citigroup's diversified product mix, which is a key aspect of its strategic focus on core businesses.
3. Equities: The Equities segment was up 26% in 2024, marking a record year for Citigroup. This growth is a testament to the company's strategic focus on this core business and its ability to capitalize on market opportunities.
4. Banking: The Banking segment gained share across all three investment banking products, with revenues up 32%. This success is a direct result of Citigroup's strategic focus on its core businesses and its ability to execute on its growth strategy.
5. Wealth: The Wealth segment was a turning point in 2024, with revenues up 7% and net new investment asset flows growing by 40%. Citigroup's strategic focus on this core business, including sharpening its investment focus, rightsizing expenses, and improving the client experience, has driven this growth.



Return on Tangible Equity (RoTCE) Growth

Citigroup's return on tangible equity (RoTCE) grew by over 200 basis points (bps) in 2024, reflecting the company's strategic progress and improved profitability. This growth is a result of the company's ability to generate positive operating leverage across its core businesses and at the firm level. Citigroup's net income increased by nearly 40% to $12.7 billion, and its efficiency ratio improved by 340 bps while increasing investment in its transformation. These factors contribute to the overall growth in RoTCE and reflect the company's strategic progress.



In conclusion, Citigroup's Q4 2024 earnings call highlighted the company's strong net income growth and strategic progress. The bank's strategic focus on its core businesses, cost management, and transformation initiatives contributed to its impressive performance. As Citigroup continues to execute on its strategic plan, investors can expect the company to maintain its momentum and deliver long-term value.