Citigroup has started the year with a bang, tripling its profit in the first quarter after releasing $3.85bn in reserves but announced plans to exit a handful of its consumer markets.
The investment bank reported quarterly net income of $7.9bn, up from income of £2.5bn in the first quarter of 2020.
Revenues slipped seven per cent from $20.7bn to $19.3bn as higher revenues in investment banking and equities were substantially offset by lower interest rates.
The bank’s bottom line was boosted by the decision to draw down $3.85bn in reserves it had built for bad loans during the pandemic. It follows similar decisions taken by Wall Street giants Goldman Sachs and JP Morgan to draw down on loan provisions.
Citigroup’s global consumer banking revenues were down quarter-over-quarter but chief executive said it is the “healthiest we have seen the consumer emerge from a crisis in recent history.”
Despite promising signs in Citi’s consumer division, Fraser is doubling down on her strategy to simplify the bank’s consumer business.
Today the bank announced plans to exit 13 markets across Asia and EMEA because they “don’t have the scale we need to compete.
The affected businesses include consumer franchises in Australia, China, Poland and Russia.
“As a result of the ongoing refresh of our strategy, we have decided that we are going to double down on wealth,” Fraser said. “We will operate our consumer banking franchise in Asia and EMEA solely from wealth centers, Singapore, Hong Kong, UAE and London.”