Citigroup's profit fell 13 percent in the fourth quarter as it booked a US$1.2 billion (HK$9.36 billion) loss tied to the sale of its Russia business, offsetting higher revenue from dealmaking and services to corporate clients.
Earnings slid to US$2.47 billion, or US$1.19 per share, in the three months ended December 31, the third-largest US lender reported on Wednesday. That compared with US$2.9 billion, or US$1.34 per share, a year earlier.
The lender's board approved the sale of its Russian unit, AO Citibank, to Renaissance Capital last month, resulting in a pre-tax loss of about US$1.2 billion largely related to currency translation.
Citi shares were down 0.7 percent in premarket trading after the results.
Citigroup's return on tangible common equity was 5.1 percent in the fourth quarter, far short of its 10 percent to 11 percent target for next year. Excluding the Russia loss, the return was 7.7 percent.
Wall Street banks benefited as M&A picked up late last year. Activity rebounded in the second half after tariff announcements weighed on markets in the first half and the US government shutdown delayed deals.
Renewed corporate confidence and a more accommodating regulatory backdrop prompted companies to strike deals, lifting fee income for lenders advising on mergers and capital raisings.
Citigroup's investment banking fees rose 35 percent to US$1.29 billion, up from US$951 million a year earlier.
“2025 was a year of significant progress as we demonstrated that the investments we are making are driving strong top-line growth,” said chief executive Jane Fraser in a statement.
Industrywide global investment banking revenue rose 15 percent from a year earlier to almost US$103 billion, the second-highest after 2021, Dealogic data showed. Citigroup earned the fifth highest fees across banks over the same period.
Analysts expect deal momentum to extend into the new year, helped by lower interest rates and a more accommodating regulatory backdrop.
Revenue in Citi's banking unit climbed 78 percent to US$2.2 billion in the fourth quarter, and the bank posted a record M&A performance in 2025.
TRADING SHINES IN 2025
Markets remained volatile in the fourth quarter as investors speculated about a potential bubble in artificial intelligence stocks, the Federal Reserve's interest rate path and geopolitical tensions.
Citi's total markets revenues fell 1 percent in the quarter to US$4.54 billion, driven by fixed income and equities. Markets revenue grew 11 percent for the full year, compared with 2024.
Market swings often boost trading income at banks as clients reposition portfolios.
Meanwhile, net interest income, the difference between what a bank earns on loans and pays out on deposits, rose 14 percent in the fourth quarter.
While lower interest rates can weigh on net interest income, they can also spur demand from borrowers.
Citi's shares gained 65.8 percent in 2025, outperforming its peers, and an index tracking bank stocks by a wide margin. The bank has bought back US$13.25 billion in stock last year and although shares still trade at a discount to rivals, they have narrowed the gap.
Fraser carried out a sweeping reorganization and reduced headcount. The lender is set to cut about 1,000 jobs this week, a source familiar with the matter said on Monday.
Rival JPMorgan Chase beat estimates for fourth-quarter profit on Tuesday, while Bank of America and Wells Fargo reported higher quarterly profits.
Reuters
