Citi Sees 20% YoY Jump in Q2 Institutional Clients Group Revenues

Citigroup Inc.​ announced its results for the second quarter (Q2) 2022 on Friday, showing an increase in its total revenues.

Key Metrics in Q2 2022 compared with Q2 2021

• Total Revenues increased 11% from the prior-year period, with growth in both net interest income as well as non-interest revenue. Higher net interest income was primarily driven by the benefits of higher rates as well as strong volumes across Institutional Clients Group (ICG) and Personal Banking and Wealth Management (PBWM). Non-interest revenue also increased, driven by Fixed Income Markets and Services in ICG, which more than offset lower non-interest revenue in Investment Banking in ICG and PBWM.

• ​ICG revenues of $11.4 billion increased 20% (including gain/(loss) on loan hedges), driven by Services and Markets, partially offset by a decrease in Investment Banking revenues.

• Net income of $4.5 billion decreased 27% from the prior-year period, as higher cost of credit and an 8% increase in expenses more than offset the 11% increase in revenues.

• Earnings per share of $2.19 decreased 23% from the prior-year period, reflecting the lower net income, partly offset by an approximate 4% decline in shares outstanding.

• Operating expenses of $12.4 billion in the second quarter 2022 increased 8%, driven by continued investments in Cit’ s transformation, higher business-led investments and volume-related expenses, partially offset by productivity savings.

Citi CEO Jane Fraser said, "While the world has changed since our Investor Day in March, our strategy has not and we are executing it with discipline and urgency. Treasury and Trade Solutions fired on all cylinders as clients took advantage of our global network, leading to the best quarter this business has had in a decade. Trading volatility continued to create strong corporate client activity for us, driving revenue growth of 25% in Markets. While economic sentiment clearly impacted Investment Banking and Wealth Management, we continue to invest in these businesses and we like where they are headed. In U.S. Personal Banking, the positive drivers we saw in our two credit cards businesses over the last few quarters converted into solid revenue growth this quarter, most notably a 10% growth in Branded Cards."

"In a challenging macro and geopolitical environment, our team delivered solid results and we are in a strong position to weather uncertain times, given our liquidity, credit quality and reserve levels. I am particularly pleased with our capital strength. We ended the quarter with a Common Equity Tier 1 ratio of 11.9%, having built capital due to a higher regulatory requirement. We intend to generate significant capital for our investors, given our earnings power and the upcoming divestitures," Ms. Fraser concluded.

To boost further growth, Citi expanded its digital asset businesses this year. In June, the company tapped METACO to develop digital asset custody capabilities and partnered with Nexo to pursue a consolidation of other crypto lenders.