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C Citigroup

Participants
Elizabeth Lynn Head, Investor Relations
Mike Corbat Chief Executive Officer
Mark Mason Chief Financial Officer
John McDonald Autonomous Research
Glenn Schorr Evercore ISI
Jim Mitchell Seaport Global
Mike Mayo Wells Fargo
Matt O'Connor Deutsche Bank
Erika Najarian Bank of America
Steven Chubak Wolf Research
Saul Martinez UBS
Ken Usdin Jefferies
Brian Kleinhanzl KBW
Jeff Harte Piper Sandler
Charles Peabody Portales
Vivek Juneja JPMorgan
Betsy Graseck Morgan Stanley
Gerard Cassidy RBC
Call transcript
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Operator

Hello and welcome to Citi's Third Quarter 2020 Earnings Review with the Chief Executive Officer, Mike Corbat and Chief Financial Officer, Mark Mason. Today’s call will be hosted by Elizabeth Lynn, Head of Citi Investor Relations. [Operator Instructions] Also as a reminder, this conference is being recorded today.

If you have objections please disconnect at the time. Miss. begin. may you Lynn,

Elizabeth Lynn

take Good citigroup.com. our thank Mike call Then to download CFO speak operator. which questions. earnings joining available take we is Corbat all will us. first. for will our Mason, On today our Mark through morning you, the you presentation website, and on for will you Afterwards, Thank are happy CEO, be

on our statements, results, management’s in you get Factors expectations that that to said, today’s statements the which XXXX to started, statements to are and may our With contain referenced SEC variety may section circumstances. other we Form without XX-K. turn in subject me in based Before are these Mike. today conditions remind filings, the forward-looking current changes and materially limitation, of factors, to due including, a our Risk including capital I’d presentation over and from it precautionary differ discussion let included financial of like uncertainty and Actual those

Mike Corbat

Liz of Thank quarter reported for share we earnings morning, earnings of $X.XX. Today, billion everyone. third per of good net and We the $X.X had XXXX. and income you,

the deposits We revenues COVID-XX well. to have extremely stabilized, navigate continue up X% costs continue Credit and increase to pandemic are year-to-date.

week financial how and are business we approaching As orders with I into will discuss through OCC last entered our you the know the consent those we I Federal Reserve and and performance. go after

now fixed significantly and year dollars, year-to-date. the Investment and the only had markets and in X% our with Trading strong capital income credit the to the private of revenues pressure is the despite global institutional rates. time, clients the continues Our extremely predominantly up banking for and same to Treasury Global of in investment strong banking balance, another for clients equities economic driven group the costs backbone revenues more X% challenges deposits accessing pandemic, quarter interest were well, saw shown Solutions, perform quarter are in light performance our Banking X% as remained Trade decline to constant for our we're well. bank network up lower from increase by At wealth due we clients. significantly, XX% consumer year-to-date. facing. our decreased On global respectively resilience spending. consumer and the the impact continued franchise management and XX% has under of card activity credit down

quarter XX%. to above with Our ratio capital equity increasing well our tier the XX.X% position of minimum regulatory strengthened one during common our

to a our book per time. we $XX.XX increased from over Our returning and up year to tangible X% share to value ago, committed remain shareholders capital

need to consent the on data in progress to place, management, and need areas is making they risk ties governance, and that these these our where areas, to We've environment; not we've remediation simply infrastructure, governance What areas while in Turning modernize we're four focus and processes. together control controls, be. we the risk been compliance. our and had impact orders, programs

bank. our to we're the modernizing While thoroughly this identified addressing issues orders disappointing, in committed the and is

regulatory when program and As on focused know, We're learned you manual We've management many can investments. quickly accelerating unsparing points, reducing from making producing and been touch cause we're firms. accurate reports. laser from centralized management of automating we've outside analysis accessed changes be data processes structural root and and ensuring

to and issues to we end a control the we to operational or our the gap are and environment us priority get importantly, a won't This necessary excellence, in-depth ensure strategic fix, going firm an state. need achieving making we're analysis tailored easy solutions be risk and More conduct to strengthening quick for forward. the face our

resources certainty that while the I continuing can the While serve necessary clients. tell to multi-year a out committing for yet, we with cost our transformation, scope you can't all fully we're

Importantly, Collectively, create not speed. they'll not we’ll efficient, and completeness our investments jeopardize we're regulators, infrastructure us customers. that quality only for will the aligned clients a as our competitive, digital make or so and soundness, safety far serve these also and concerned, more will ability as are significantly further more timelines our with improve enhance our to

sheet to our need these years, close has the from and faster our In gap So in business efficiency recent prevented tremendous competitors. our performance, our are have returns we and investments firm whether hindsight, de to we risking it made should make. done progress them are But balance improving to and with coming it's this.

and secure. stable sound is foundation Our

we've is necessary the step this risk take and performance our the to Citi and Our progress shows forward. control during environment for made in excellence achieving operations pandemic our next

and and Our of to be franchise in day. them made to proud is change to this to right who Ahead it done the management of everything people getting With know your questions. through of it to transition then February, happy and they'll Mark, capable entire go I driving They've be needs the committed Citi every continue so we'd and the ahead. us up and make way. is where times committed transformation in do team will doing presentation that, take the is asked the

Mark Mason

modest quarter $XXX a which Thank this include EPS Reported roughly of everyone. three, by orders good you, in net which Starting also that and consent included $X.XX. quarter. negatively the with reserves income in connection million the Mike on just billion, impacted Citigroup morning money of mentioned, increase third results Mike million credit slide $XXX civil reported $X.X penalty

revenues declined billion the For of quarter, from the year. X% prior $XX.X

of supporting the activity more of were up lower consumer. levels Expenses of Credit the to first than our to invest and half of in this by combined trading we X% meaningfully and $X.X continue year. year-over-year, the lower as While investment infrastructure control were in and banking strong, rates environment. remains impact billion relative lower interest risk is cost offset

tax effective quarter. for was rate Our XX% third the

well the as our three a cushion period increase as of franchises, in XX% year-to-date of spending reflecting credit institutional results, reserves investment engagement, X% well banking and as strength manage increased constant crisis, liquidity, a In dollars, this slowdown institutional which credit to even well across by platform repayments reflecting and and level Deposits income in at our leverage end operating businesses, X% a while continued markets net allowing higher in reflecting grew consistent of in of the our consumer. And serve deliver predominantly continue the us also across draws businesses, We to we lower grew billion. and to billion, margin. and client quarters year, to consumer with Looking roughly our expenses in strengthen X% in benefits positive as over activity both institutional global reserves. loans we $XX we billion, significant of revenues a consumer, year-over-year of form year-over-year, way by through declined delivered $XXX capital available and increase operating as $X the liquidity. through the significant with X%

As our basis CETX XX.X% regulatory XXX points of our requirement. September XX, Capital close above ratio minimum was to

We billion in liquidity. available $XXX have over

loans. modest more far provide we at than doubled to action manage our discussed credit this ability crisis. detail this as reserves the nearly to we so support stable the at on year. funded all as reserve have feel clients quarter, they X% year. our roughly four, additional about and continue We since this including on ratio last On was stand billion, And good last taking end $XX reserving quarter, increase we through of our we Today, slide

more which outcome. economic these a management uncertainty, of well first as our short continuing full now As to by year both expecting downturn GDP quarter, year in unemployment next scenario reflected XXXX I year. adjustment recovery event unemployment, levels. GDP specific other muted further lived like end, a the we for and example, however, protracted can note, prices XXXX. view the a move for XX estimate of base and to variables assumed looking by is case rolling basis more quarter. the is second reminder, we reserves downturn back recovery as In quarter of outlook in a improve quarter losses a and tied somewhat also close adverse the sharper a include slower our the to And through oil crisis. of see and of half on our this unemployment with room provides into in and more as VIX credit By peak year base to beyond end severe lifetime followed improved our but scenario, falling year, the as a important forward an X% base the you prior in recovery generally that this some And with and a a would are

we to But the for items. which Today, from billion during billion adverse small a net did $X.X impact our offset management by we basis base in our macro did significant scenario to reserves on this base a factoring economic the not outlook partially quarter. So a downside case. see change in our other relative add are lower from uncertainty, grew more adjustment that volumes is to we quarter, on and $X.X loan

second a more in we lower versus in deterioration the base case. X% quarter U.S. example, is growth only which rates, case significant our our now X% that than to For are incorporating XXXX base than lower GDP outlook was close

the changed, $XXX management have So would all roughly seen of if the a else being adjustment we not release had in equal, reserve million quarter.

prepared than of worse for of through more to our level our CECL the as base something the credit come crisis, down progress releases continue holds. nature today, nature we reserves hold the of our well expected and management at lifetime now likely offset losses, having case. is that the conservative and that than see it for we we're adjustment, believe assuming our case base we'll losses Looking And future given not reserved to in we ACL the reserve XXXX methodology

somewhat as economy future build support this cover to we be Although our needs. loan likely client’s offset would growth and additional need recovers as we may reserves to the

consumer each to in EBIT banking shows five of global dollars. business. for the billion. delivered constant GCB now Slide $X.X Turning results

results lower other increases offset consumer as related six shows in the X% expenses. and were savings and decreased related discretionary Slide reduction deposit interest regions, American lower stimulus COVID-XX in efficiency expenses, Revenues spending, volume offset rates and sales and were momentum across losses lower benefit under growth card relief. lower all and where a strong more wealth from we're ACL remain release, U.S., While last small government more North billion partially reflecting and as for in XX% in lower by in average particular were XX%, of Branded than credit year. other volumes revenues revenues costs a down detail. this lower by down quarter from quarter, purchase down Cards Total $X.X billion expenses continued the XX% loans. revenues were considerably Asia, and and of third declined reflecting continued $X.X credit seeing pressure, management marketing was net in

As payment we're the of down an to have seen and across during sales stress year. to industry overall not third same continued recover X% purchase rates seeing pay. their but have increase versus time, in still the the and seen sequentially, At quarter consumers we ability yet as remain liquid XX% last

higher activity and clients higher rates. sales as initial XX%, were activity XX% purchase down have loss well partner loans headwind, remained lower sales delinquencies has of purchase partner loans to as for lower year-over-year, of reflecting the more payments but year, on paying expectations in as revenues resulting Branded This this were Similar revenue expectations down billion our versus a credit quickly sharing. revenue average drove interest X% $X.X Retail while of benefiting revenues Card, XXXX. quarter our the therefore sequentially lower our the down cost income loan reflecting Higher services creating payment So up it outperformed average XXXX, but last remainder XX% improved, Net payments. declined and of pressure losses impact XX% in also and purchase higher are is down year-over-year. by recovered on balances. decline also is as

transaction by digital in revenues portfolio $X.X we declined to program impact deposit from Asia, coming we with including quarter. travel show XX results and the in capabilities. offset banking travel continued opportunities offset North deposit Average launched on with new we of a the recognizing savings revenues last including we up wealth year-over-year, We're in further and modest thirds were other foreign decline credit credit XX% lower U.S. two for With On our banking fees. digital relationships the our branch with American XX% saw slide with for of including losses reflecting in Wayfair. down constant than expenses, were deposits digital billion related strong $X.X COVID-XX year, growth retailer XX% while net than reflecting declined card and lower of billion continuing leading year-over-year revenues for international companies of from provide as release. third costs, XXXX were as During as and revenues Cards our to growth card related consumer discretionary e-commerce through mortgage our revenues see programs. to Retail these managed volume we than footprint. seven, X% cost and credit deposit Total with outside We reserve more decreased top dollars. consumer half which were Asia by incremental customers, X% XX% with In card consumer sales a diversified spending, quarter, expenses credit marketing down our purchase the now well spreads. down partnership, lower e-commerce and a disproportionate continue checking. And Total this related efficiency will sales investments year-over-year. more year-over-year activity a higher customers momentum levels XX% in as expenses. lower more from in deepen XX% lower look interchange

and new growth revenues investment We in growth However, money remains engagement quarter year. this and up this net growth record last quarter. management client strong saw Citi wealth versus strong XX% clients reflecting our XX% deposit XX% strength And in continued. with at average gold continued X%

Mexico regions, this Similar America, balances good we with declined Latin in quarter, XX%. in of total to revenues growth average to deposits XX% Turning a saw consumer other year-over-year.

by this business credit fees. lower X% the in However, Slide spreads consumer decline a reflecting lower and remained reflecting $XXX revenues in closures expenses. and eight in pressure third and total, branch a efficiency, million, a modest provides were quarter, credit detail collection additional under third losses volume In And the and impacted deposit global with released operating cost expenses were environment. continued savings our declined lending quarter, macro related down of International accounting to consumer trends. credit for change on net reserve party for

earlier, this and noted lower the improving in of of broadly remain trends quarter, programs. benefits high I As levels U.S. to the liquidity credit spending given relief stable

elevated. begin off, However, we programs year to as and the unemployment do towards to rise likely of next end expect stimulus losses XXXX roll and other government peak and remains

$XX.X all solutions security our creating capture franchise. corporate engagement digital continue given our that service to across in us In we client of quarter and to businesses income and as EBIT our progress billion Clients nine, Group exist model year-to-date. full on the see and equity highly third TTS, third natural $XX.X and in to now services. X% slide global revenues offset new differentiated Turning billion by lending Institutional delivered bank banking across of the for quarter, allows linkages the our investment in this clients ICG $X.X the strong of increased was the and which Revenues billion partially strong fixed quarter, lower performance private markets, platform, in institutional

lower to commercial the $X.X with Total the of trade and $X.X X%. for revenues starting banking. were results than growth offset reported, deposits interest and down the solution and cards more now billion lower X% dollars, revenues by as rates, were client Treasury constant impact X% businesses, declined in strong in of banking solid revenues. and billion engagement of as Turning

improved from we in continue investment Capital IPOs, were through also be seen markets, products and convertibles we've spreads. additional commodities. as instant new make And million demand we $X.X last services helped end XX% client continue driven environment. billion sequential capital by down across continue client draws, Investment year-over-year, strong strong expenses Bank by finally, than markets allowed by billion we billion operating in Our on have infrastructure, drivers And security spreads. volumes well over markets to revenues, volumes capital and $X.X access finance. uncertain had favorable in client as significant XX% derivatives, as is loans. despite versus countries last solid performance our while as significant of X% And of X% particular, reflecting and constant management year, prime by we investments, this and up loans last Private solid million quarter. services, client two we more of constant markets compensation are risk $XXX were by is lower client that lower slowdown. in growth saw One continued which revenues to them example reflecting managed Corporate million average continued down quarters, were billion seen Total were were revenues in as controls through the more grew grade help facilitate deposit although the up environment strong clients Income continued in XX% underwriting engagement, up now were investments liquidity year, corporate We a prior driven both in higher million which higher in well clients X% on engagement capital follow costs to and were share XX% costs. the economic the growth as led payments, increase offset particularly reported revenues XX lending credit continue as repayments of significantly XX% in have conditions of macro $X.X we Total our to going in grew Banking revenues from partially reflecting as to continued due of continued dollars, dollars, The the down of and than underlying revenues we higher these year-over-year. offset XX% forward. decline higher Markets solid gains. raising basis, cash were offerings. and deposits $XXX in performance where uncertainty million Fixed increased revenues in support of security $XXX to as $X.X in $XXX and capabilities. revenues offset volumes for live X% and provide our revenue significant in of period and spread equity us lower we actively investor and extremely reserves a lending. equities and navigate markets, strong the and seen increased largely market $XXX to on built as were up year, Equities more and basis. for meaningfully in of Total

As credit end, net the overall funded our grade X.X% of ratio on losses including million. non-investment quarter reserve was $XXX were Total portion. X.X%

non-accrual total significantly billion, million impact of Finally, of last for across sequentially shows roughly the reflecting assets repayments loans from rates, and the Revenues declined Corporate/Other. Slide $X.X $XXX results portfolio. lower write-offs declined as than wind year I XX of to down civil costs COVID-XX reflecting and legacy as money marks management Expenses well and controls, mentioned penalty million associated assets infrastructure, earlier. on the investments was that down and incremental the as offset risk were wind with up $XXX legacy securities. the by more in

balances million lower dollars, revenues. of the balances Excluding corporate/other Slide revenue a would for margin lower declined rates related On basis, quarter, basis the as $XX.X XX lower lower billion $XXX net expect loss pre-tax and the million trends. trading by the interest revenue a interest million related XX interest net In And net partially NIR our $XXX ahead this pre-tax roughly lower this total points, as impact offset the by higher margin quarterly and to year-over-year, interest trading impact quarter loss. shows well reflecting declined loan reflecting quarter. revenue and net driven $XXX similar constant by net loan looking fourth interest onetime of declined penalty, was we of sequential NIR.

year-over-year. and given Turning by activity, banking to of lower third investment revenues billion consumer the non-interest revenues. quarter, declined non-NIR In partially strong to X% $X.X offset trading levels

rates both quarter, the COVID-XX lower activity. and key dynamics the to of our fourth with normalization levels As activity year-over-year, revenues well and as lower banking expect interest metrics. in we investment net the XX, revenues slide impact down capital look non-interest as of to the of continuation On related we and we these trading reflecting show

to net net by book CETX supplementary X% by ratio was income, driven income. ratio XX.X% improved value And to leverage Our tangible grew X.X%. per by Capital our $XX.XX share our driven

I conclude, few spend the let quarter. outlook on our me minutes for fourth Before a

activity also in to On would businesses see ICG. And and the pressure the the our related COVID-XX. of weigh top of we low expect and reflecting impact continued line, rate on rates continue consumer lower to cool to environment expect to levels we

the offset basis markets in and expect broader reflect banking more by Our that flat, with prior full net this interest with should on revenues a industry revenues, result trends. total, roughly guidance. are full investment revenues businesses or to In year consistent year in non-interest we less decline

On customers. remain the our supporting expense we on and protecting focused side, employees our

making are enhance investments world. investments we see excellence targeted and future. environment digital And We for accelerating opportunities operations the in where our are for the risk fully control the and we a in our to franchise best achieve

As that or are could see full we percent on a couple expenses basis. a so a year up result,

Turning to credit.

unlikely and have releases losses for wouldn't this environment communities. liquidity of a Mike a quarter, earnings the we book I But challenging seen we strong significant remains and value fourth position. I any have and to to outlook if our quarter material this we the demonstrated engagement with any to continue With quarter, remains Overall similar supporting are we happy remained Year-to-date, client As In quarter. would We take quarter. perform ended already, of we those focused franchise, are that, builds. grew questions. well. employees, customers, the also expect we but and expect summary, remaining the And see level quarter, the given the strong. additional on to this power clients capital reserve holds, mentioned uncertainty, we macro this

Operator

is question from [Operator of Instructions] McDonald line Autonomous the with Research. first John Your

John McDonald

was why terms weren't of consent lessons invest regulatory earlier? And it these the as and to to just I there a wanted and just you to Mike morning. the Or good the question was order learned issues get misread you ask hear addressed in resources guess, your me? is didn't Hi, here. Was, Can attention expectations? management need of on yet? question elsewhere? ` needed

Mark Mason

is this Mark, you John, me? can hear

John McDonald

sorry. Yes, hear Could question? the [Ph] you

Mark Mason

hear did question. we the Yes,

be mic you muted. -- Mike's think I muted may

Mike Corbat

Oh, me? can hear you

Mark Mason

Yes, yes, can hear we you now.

Mike Corbat

Like, I'm sorry.

Sorry.

were to I a So in a And investments the strategic way think that it didn't think governments. be being faster. decade was the make, John, that we've continue move we've of to projects But remediation we're next focused. across saying, our significant made financial Conference, over phase past along do going felt both going critical. COVID I done targeted the I we've a got of fast got we've transformation. lot so how to work to gone about think again, that, or have focused feel our that, we of make you and obviously we've we've said, we're enough. not think proud think I to what firm fast we've COVID, what of feel of terms come and in our infrastructure the look our operate. And I to haven't done I we strengthen and over we to about And at over. a about And quite of our areas we continue At for controls, to do, terms spoke that's kind of we think certainly we we initiated always the number the if positioning and investments. as But perspective. Mark And say way would we've And, been you that, where enough, I number been a that able Barclays through

of work be and in on. four, to terms going should component. how what I is component, our have a four pillars go the people my with the with think, Peetz of this. opening, for processes, would and that on in we're expectation agreeing think the going One us organizational think, we're this is I focused the And sure the putting be go we'll institution. comes And terms give of to brought that that really in done that and we Chief to the of I terms needs I Karen an as I think in making think I you've be, and state in framework fell I in. coming together strategic Administrative what say where being And and approach around we of vision really creating we assessment across the external Officer, what seen critical, our which hiring said, it's establishment, the do already end to short. that way

I the sure that things the everyone's think responsibility understand fourth and elimination is and So as and addressing driving this opposed data behind things the simply in this there's automation, manual around all other of component to technology we've that solving to businesses, all to making specific that the the operational issue, And get I make component all like the functions sure about. an holistic think importantly, cultural spoken touch of piece, making that it's problems, points terms sure that we're the proper regions, right.

I smarter to lack of say that So been John from effort, we certainly but could the it, say around it ensured endpoint. have and commitment the, hasn't would would getting to I to work

John McDonald

required And that with the the coming the expense, still helpful. additional and will investment if that's over And you years. be time the progress you in Mark. you the Mark help Thanks. do that M&A, opportunities Will significant also, or simplify peers? acquisitions, and can't are could to a gap goal? profitability profitability? there can closing and needed then make up follow potentially think Do our Okay, for portfolio work orders, a consent still obviously, be company to down slim

Mark Mason

Thanks, John.

to every our see having answer time a continue they well with this hasn't that at that will over business to over So With as look with returns and that a to some in crisis, opportunities unique best a hard to model your as opportunity through our corporations you comes serve CEO, to around how through out what new clients. to -- we can model, capture continue yes. we that every I business time intent gap managing mean, similarly, through at this benefit is as our and this, to ways the the we'll changed. improve so And look come to crisis, sense to and see the look the opportunity. we strategy, continue crisis at our world narrow a makes answer take -- and as of and the unique of manage think is profitability, and increase continue is incoming

John McDonald

quick ordinary Thanks. what still it acquisitions that's portfolio Is is be course? follow-up. something that Okay. deemed significant defined? to be you One Or clear versus additions to or will

Mike Corbat

be of still to to define franchise. terms of activity, on of the things have what we that. defined. types agreement activities that do in parts It's some in still and different other within significant terms obvious that means BAU of are get and regulatory securitizations, But But there we

John McDonald

Thank Okay. you.

Operator

Your next line of question with is from ISI. Evercore the Schorr Glenn

Glenn Schorr

Hi, there.

morning. a Just Good quick maybe follow-up.

up clear And the inside Just outside and going is related then, and of of to expenses front? to to businesses? question on off a any be comes act Consent. banks that return be to Corporate/Other quick follow of will it Are capital the the you the on act suspension will return and the as group able other that when you the capital if -- the

Mark Mason

sure. Yes,

to booked Corporate/Other in serve and example, in respective a meant the we the nature the businesses on again, expect would go in that the than we that or To between of we're in nature or the spending XXXX. entire vision respective a dynamic, as depending question, heard depending is is key book that the help spend franchise. of In give I scope out some first you me likely the the of forward one in do, it spend. other quick incremental billion more businesses. of a That of be $X some Corporate/Other, similar well it example, would that in spend mentioned the Corporate be for of as to terms the of on we'd spend a state of as benefit terms consulting would before, process, or would some split as

that's just example. one so And

capital from and decisions In nothing of there's capital decisions, making forward. capital Order the forward, prevents going terms Consent taking going that us action action actions, in

And come similarly so, of this to our crisis. act to would be that as we we'd peers expect out we able

Glenn Schorr

Appreciate could. that. if One on quick I one cards

includes how macro marketing, the off a meaning, what well digits our and Mexico, digits wonder trying obvious the is side just back much given banking on. to spoken bottoming in if that to build backdrop could how whole you've And the of to of out you're and parse you and we us on takes you're the -- into and Thanks. that You other that I where the double marketing out and Because down some teasers promo environment Asia think we're overall. already base? macro building double but bottom. have you how into

Mark Mason

Yes.

of So different look, there are a think couple are dynamics I important. that

key I think in still the midst we're crisis. one the a of hit is you which on,

quarters, prior pressure it purchase across And but that in so, was pressure certainly franchise. seeing there. there very we're better than still much seeing the the It's We're still is sales. on

of that how revenue us an quarter partners. purchase and part to that's through what ends big is this services. the resulting in way to as to with But factor. watch that's GDP going important in important activity of the in revenues the how pick means One up with And that starting this dynamic plays tied unemployment, loss up. the forecast and sharing an to That's expectations evolves, see be is partners partner you the sharing we in more retail where drags have improved

We are close watch on a keeping that.

We we thoughtful want turning. see signs we about of cons advertising, and as when back to marketing have cetera, about leg be we et cetera, things spend et back in dialed

seeing warrant keep the that some don't late as we volumes. on the it And see. at through. drive proactive That's future be of to testing after managing But of spend pressure seeing good we're byproduct to activity on want us and so, we're that really volume direct that. sense close now, watch we we're of we'll a that. the increasing We think of to makes it a that some right where crisis And we where it be very getting signals

Glenn Schorr

Mark. Thanks,

Mark Mason

Yep.

Operator

Mitchell the of Seaport Your next line is from with question Jim Global.

Jim Mitchell

morning. good Hey,

Mike Corbat

morning. Good

Jim Mitchell

a expenses. a just morning. Good question, follow-up on Maybe

investment to of going the pretty beyond we spend. because How perfectly about XQ? And offsetting up forward? over of path? kind last done and saves. you the that investing, have year, Is on start can ramp year? do think guys job Or on that we Obviously, about next with a this stabilize get years spending back think how sort incremental You few of not good this may happen efficiency that do

Mark Mason

Yes.

I started that path of incremental this as XXXX. mentioned, and $X a if I in you year risk So think gone got incremental that that billion we've spend will We spend look, controls. about towards infrastructure, an has --

will spend. and direction billion in to rate spend again, recalibrate we that There's or spend one-year I we And that spend we it step, some controls opportunity highlight extent very them. order advantage incremental that we'll to There necessary. we speak we'll do have of into look some that take incompliance dollars spend, is be of risk spend to vision a and an come is it types in some reprioritize think dimension spend the with the order management is a the our key those to what a appropriately and to in and The step the So and and space, requires, as point step, that of opportunity towards expense processes, have in is because or of reprioritization the opportunity. for target around that our it need and to which a XXXX of I activities. back more an so at these state that different that important run already up get

will the to improve been terms operations, but over is only do able points, of investment. in highlight straight of the market the manual our of we'll so, compete and things many reduced period allotted terms run our we're touch the And that, time not order. things Many that's serve And of in and in us way our to to processing. we within organization, go It yield that over through benefits Mike we of because terms way clients. those in automation, in the way an I in the described that

down away the will means, investments. spending make that and And that, And from And to of Separate that, do we to wisely. the and dollars so, those sure we across ensure continue we look we're these I needed firm. that accrue ensuring from franchise and the to those be in because -- the that make line. order away responsible managers from in will I improvements separate to compromise investments benefits and won't expect

Jim Mitchell

the is Okay. I And That's just and stabilizing, NII. where when now? guidance. But the it right maybe do see helpful. year-over-year pivoting of just given to rate picture you appreciate where kind

Mark Mason

Yes.

quarter We of hopefully on combination assuming out. has diminishes sheet. a near factors look, XXXX, trends kind factors the the are the mean, current a go balance flat not the into only important we COVID the as stay on there the for the obviously year, the here, businesses, project near and to played played that that as play remainder amount I'd the I bit. all and and the volumes expect stabilize little growth but rates, in relatively So that accrual of some that's of lot are liquidity through through impact market, let of of alone had

the before, markets said be I've could volatile. near as However, somewhat

to So, -- know. here. hard through the year looking well you the stabilization as a end of predict I'm little as looking we're come But at bit we

Jim Mitchell

Okay. Thank you.

Mark Mason

Yep.

Operator

questions to up. one question Again, please follow your and limit one

is line Mike of Your Wells from Mayo next with the Fargo. question

Mike Mayo

is for Mike. question My Hi.

Mike Corbat

Good morning.

Mike Mayo

lot on agreed restructuring. need you you the stronger when as safer They is for wider Citi's disagreed Mike, and started resiliency. came Citi is about But in times what we've CEO a improved and more spreads. CDS Since that's pace four you simpler, and look progress. were Look, we've at the

of where has disappointment the fast speak Speaking regulatory in not you we execution, from the fix XX% is efficiency, sense question questions urgency? there's were tech, with, take footprint, class of JPMorgan new And go on to give Even route you if why behalf I tech investors, you transparent and Many below with year, mix. new X%. sense eating this on continue have ROTC business of technology, on will but global the the returns, so the quarter people this enough. of this and this XX% order quarter collective time terrible problems that's the And extreme is which investors, the said last worst still alone. consumer

to to have CEO, the that still Fraser aside the a strategy? and sheet, the Why Thank of with So increased you've where had with Jane sense urgency. demonstrate go recognizing not new is the sense the of over urgency? balance improvement take way So long you. but now way a as step

Mike Corbat

Sure.

the real would that by to to the out, it think Mike, company a is I important transition. important I board, we start So saying it's that have

board as and you this part As minutes. three-year transition in recall, my that process, did XXXX. announced close the I I'd five was which about the we throughout plan, year And commit stay the of to out

when process transition going of the kind think you planning be the very the CEO allows, it that that I plan. Jane important own into our to involved starting in And that. budget if terms now. I are was recall, We and much financial of started, And I thought

much timing will very in she And was think of in will delivering the coming for because coming being terms think be fortunate the with be that case. my of And case. year and I Jane I future. of I that in next accountable into the

has it's the also important other things the on work gap to Consent I that and working analysis transformation on Order. the Jane think related taken and

to is that, right by the business. of She's American part North our I terms to in office As thing the do. think day in have Jane the orderly running to a our continues of consumers. And terms overseeing also the way, job transition of return

income accomplishments, year in last terms of the think the acknowledgement. But billion billion. I of net increased kind north the terms some $X.X from in appreciate what again, grounding I started, $XX you of we of end where said of of to

return Our XXX basis XX about points, on to points. assets right from basis went

our share went yes, returning So to a any six tangible still about We behind equity, in from return by returning towards count went billion from to XX%. peers nearly XX%. last X% way hardly went capital closing common our over the that years in gap. XXXX returning $XX on long But

don't And feel that. and think that's you urgency. in those sense of commitment of about things I great to the without a team place commitment so, accomplished and I sense their And a

think will And I kind I they I I significant the about think act I think a as COVID, the can so, that she take think with And urgency. environment, again, we of in of that advantage Mark and out be And and COVID And of. think got sense on there's to we of made when And on as team of they'll build will and those here foundation think Jane's talked think things progress. certainly things. or come from out focused that. coming have I I they

Mike Mayo

worst-in-class book with what stock follow-up, Because improvements, the $XXX to where was CEO Citi the one about despite since Citi still XXXX, can you do competence show shareholders? more half years price is was those formed, million or of ago, alignment performance. value of Well, since all just it have trading stock shy eight when at

I didn't or out the mean, So, regulators that identified. pay whether overnight, come stock, it's problems in these

strong And underneath, So just be. think I the we now engine it it's as out just should company path of find as wasn't with the all are symbolically you're as actually what investors to maybe that else take speaking plan? I with -- Jane -- speak we sudden you're sooner? have as a Citi we feel can a though show waiting the shareholders four- aside do can not secondary and on a shareholders for step three do What And constituencies. consideration after going that of other the and another or matter year the all to reins Citi if instead

Mike Corbat

related paid stock throughout Well, time types at very there's thing of and highly employees again, matter, linked in performance. that look structure, employees significantly do the I got firm, And shareholders in share drive, getting more being the the programs instruments you've whether or stock think and paid the scorecards if pay perform particular, particular. And no to hopefully to and we it's different absolutely of in how over one Mike. things

to metrics of and management disclosure work a I the that those know terms of critical, terms trying compensation I that been think from committee, board. alignment. getting at process so I and of transparent know the to the is the perspective, leadership firm. held all kind right is I think, And very create hard and again, we've metrics the in scorecard in And public broader

Mike Mayo

more can one with for execution, transparency, in just financials. disappoint strategy Alright. just looking I controls, If mean, with let's now but obviously, I squeeze Mark. if forward

expenses, the Mark, already you're this, about already dollars. you're asked far As billion as spending a

You have see to you guess, spent. I some as a do a review. of this one-year

People's exact can. that spending not a the think we of the It's when know of to you're a hear that really stages $X not going billion We think review? more as fix. a don't the easy imaginations take billion. you while. than frame quick a Again, bigger these this full So to run a it's fix, wild. fix of this billions. It's But given Is problems. billion? somehow a at early $XX we you the best should breadbox. Again, $X this Is and

Mark Mason

expect quite that. Mike, that you should know, -- we'll responsible at investments look would around continue what back, say years. the have look, managing if people I number to what we I Yes. over is And responsible be been, think, of you past is our

as to we an hard will -- It's right. that increase earlier, our question pinpoint a earlier are improve we The ability investments to make, compete. expect, second to to I to necessary would these number as is the you've are that would investments, mentioned thing going our I I continue I'd say said. to way these as investments we said earlier, think are they profitability. I And operate and that we're

But can't year to you number except We we to dimension are firm. for year our still next say, or continue after, running returns. the will improve I the the

our and through. you on give on We us for the the on financials. And get able I'll have of the with here, and is a we continue to through this the more There clients, spend, I'm as through response to and that. a sure, we be think that our performed, crisis clarity well to overall order, management do that's get budget When still actual more I manage color responsible quite crisis. will to we focus

Operator

the is Bank. Deutsche O'Connor next Matt line of Your from with question

Matt O'Connor

Good morning.

doesn't First, which from fine. forward? of thanks it we expect like, on on is the for is in questions. regulatory should I hear transition and sound call, the taking Jane, my issues surprising. of thoughts terms when the her to guess process not kind her But It's and

Mike Corbat

Yes.

and get described. let form I get of under kind educated processes opinions her start that to think her some through these and I we should her her of go feet and

view January start she'll terms call quarter the look. obviously, so, the to towards we'll probably after then on in her have that, forward the having more range. And of maybe a And introduce

Matt O'Connor

that could But and And now, sense. in of the understanding spending did allude the makes a to. so processes, for could That of views then, to changes. a room, addressing speak. money There like regulatory kind from is that matter more issues strategic there be fixing be far some

business structural the better this model and address to Citigroup will coming regulatory issues is think the So, potentially you that position Or have forward? going the more changes, company?

Mark Mason

Yes.

clarify try me earlier the me perhaps comments. Let let and

that and to So step address. we clear, we opportunity as at infrastructure have, for that look back I a order, these when an take look And compliance consent at is Order Mike key think importantly, activity need the to processes us that to you be support it and controls, them. described, Consent

type you away and as as They're business We're already crisis. and learning consent learning what simply some your of that crisis. franchise about And against business. to we've that go one the about step to forward, I clients this to spend as the execute revenue environment, The orders. a go that wise we of things in in digital Separate identifying put can was responsible learn And begun alluding and we acceptance mix of fee all through now. the about example, intend revenue What as was a probably be in to manage things the of base business important how things that crisis. traction investments they us of couple accelerate importance from manage of we has expand given that talk we our by for digitization about that their accelerated and in management type getting this years time. that to as of our very business, presents made businesses to of have and been kind our through you that's idea model. So business opportunities this or our are that the as the managers are was look opportunities we've we for a mentioned, we just at that opportunities referenced turned out aspect crisis, through the growing of investments and the I wealth

will back we an person light in playing to take created with as an of to us is opportunities I have, is, opportunity opportunity On new a of So for we any look growth would at assessment where and the and to for think a CEO, has think trajectory another crisis the you right into, step forward that, we where that the that take take an top create that think to at look. are. a return take look environment path the business and the the make and we're what expect

see will other the sure, in leg that take so, that want coming opportunity I'm And February. of would is comes she Jane to and that that. what

that clarifies hopefully point. the So

Matt O'Connor

Yes. for color. the Thanks It does.

Mark Mason

Yep.

Operator

one limit Again, ladies and to questions gentlemen, up. and your one follow please question

the Bank from America. line Erika is of question Najarian of with next Your

Erika Najarian

morning. good Hi,

Mark Mason

morning. Good

Erika Najarian

Is XXXX. management think or as we I'm billion, starting in Mark, And this have could risk times. we rather $XX.X productivity several next to expenses been re-ask point I as quarterly of successful about many attempt. I'm apologize. for wondering about asked in be to investment the that you've we But a terms good about versus $XX.X quarters? think if think the a should going how But question billion savings

Mark Mason

penalty, include, our the Well, the quarter in right of XXXX, expenses that in that expenses. plan we part civil of in you that's that, million terms now. midst that's $XXX constructing booked of operating referenced the in obviously money have And a we're

for exact an forecast rate or give hard number so, number, XXXX. me And run you to you to in for

question disappoint. sorry beyond much way. the I've already. have So But I that answered don't to

Erika Najarian

that second the is competitors we to always And call Thanks. that it's to questions questions, looking limitation cap order. Mike for out forward, and And out asset I listing my two things I without business guess But can Mayo and hard question name. to already the investors set Mike. of your as by the of back you're business not the going that think when terms since terms that came regulatory remediation prospective the after Fargo article peers, of be Wells And order actually reassure got many investors out, analysts impactful how you've came pointed restrictions? which Wells in in consent isn't down, is that route issues. last laborious Citigroup, ever perhaps that regulatory consent your current And as week, just journal out accomplished, could you why going investors one out activity your came the new same activity and years of clearly

Mike Corbat

Sure.

activities. of important very with no say, profit widespread the would you The of in from about And can kind one I did company that, is Erika, terms So we not harm. of part what go that. on customer spoke

of other not those that deep just in were second things but the is sales into there and I pieces there around and were Fargo, Wells dives practices harm, here. kind some around customer think piece of widespread industry

that And our I And we've been this asked at for and expense failures that of you seen And go focus. understanding you've talked of we've areas the the touch fraud, And analysis. if to harm, terms about it benefit think about to at of obviously we do no transformation kind of work. while, the asked could things the going around Again, speak to us of this in be but and some hard got to obviously that. is to think four analysis, time. the done. out where we've be that come the will spending historically, that important gone process offset you've We've I I there terms we're way putting reasonable of in a back working gap need and that no I we're here. got in been the way the an in a this been gap again, extensive that the costs on there open of we've kind do importantly, question to that, to us side the of Mark, just that from no really as think heard is we've get is customer to idea. think findings think I And things

you about it improvement think it about not that, hear will separate cost are should you're us streams, a do process. work that way we going cost. that the the and remediation the is way of a significant those still think But that talk from can don't there's I we to will think result recognize, what work business as

from continue linking work better will two on And things this. efficiencies not so, we're company is those necessarily to the but of to offsetting, being the those away we the

from those We through data, of allows this us us gives think we'll this aggregate ability think will risk about do second return piece in move, that think the we both think more transformation it, associated have the customer while the have, to process, way, terms that to are controls a the benefits and talked differently. that the of business we kind not a just in have and with improve and the the is we're an and firm we in it, over process that perspective, do terms the automated of indirectly. in do costs of time, way we that to speaking way but directly the I I work terms referenced ROI not we've what that this will client

Operator

line Your Research. next Steven with Chubak Wolf the question of is from

Steven Chubak

morning. good Hi,

Mike Corbat

Good morning.

Steven Chubak

to question pertaining a Mark, capital. maybe Well, for

much been reflected and an in become your has it RWA from advanced there speak generally things we in recent significant speaking, could RWAs is the And the is we've hasn't impact that like fully upward see key number? that been happened CETX movement one a of questions that quarter? that events to recently was the of One in would now further constraint. was expectation whether Or divergence relating the looks fourth we uptick binding and getting to that, pressure risks. see the has terms And hoping operational that you of could whether in

Mark Mason

is the -- The yes, Sure, the civil money you're penalty. speaking answer yes. to

And in the in given risks, operational of RWA not how magnitude estimates the a RWA impact relative our result the of We the in reflected the terms falls have of with for associated material of a the change level, as that. operational it. risk impact other the it just to there was in

Steven Chubak

Got it.

do up, Mark, an due about order the peers, Investor your -- It was then, year, Okay. delayed in and transition. follow you to related discussion and just Day. gap plan targets CEO with to a to And desire then COVID, consent in the close need to This and and the still that's one profitability intent. the to

team going coming to to at answer we the targets plans provide provide actually Now And more are hold to Investor to perspective we should it's Day, to the you timing there is can the updated think get fulsome some accountable how Jane refreshed but team least a targets could management an without when about any update? the get to? as so call, in for to the management challenging on hold intend months? some I know, we're

Mark Mason

earlier. an to fourth -- as referenced, and through tried things I obviously, get give at to a Jane the Obviously, of answer. that know you some give opportunity quarter, Yes. updated the in seeing forward. the has for quarter out. like then quarter give to full terms quarter, we we'll the of the on to that's going And think on how perspective what fourth plays obviously we're see look about earnings you things forward. this what how might the and on about fourth We'll in a market more would Mike that in work I've to Again, give not like comprehensive which said, fourth in timing also historically the in going performance view that's context, we think XXXX least for the only some performance, question tough things, you seat we but in can we've year we referenced how think a call

Operator

with UBS. is Your the Saul from question of next Martinez line

Saul Martinez

Hey guys, good morning.

Mark Mason

Saul. Hey,

Saul Martinez

on know, going is it But consent of to I here terms potential dead more the you're in and the was serious outcomes clear, improve even processes not build have more it's color, but then with horse order a and want know to longer hard short solutions a horizon risk and operational in term, you sorry, and the these this. term to take cost. it's and And having I'm more to -- time to But scam. applications it's investments I'm can beat whatnot. around be expensive the which this going as require systematic expensive, you efficiencies, you're and taking to

do much will what you're only about I incremental dimensions you're -- horizon time up And to fix you'll to on against. what just how going how fix things issues expenses, the when this? that, against, not mean, when So, the have have of and think I better I with multitude of in which different is do to absolute I'm you're When you spend and not think up all you to meaning, -- these these know mean, the terms, to handle issues? say, talking you

Mark Mason

Yes.

and at this me go again. try let So

So look, spend, total expenses. in $XX call year it $XX we terms a billion billion to of

whatever we very, of very about past as of years. that the managing billion of base, compensation. half I expense useful is have think incremental different technology. there a that areas large been And associated maybe of a base, we've that expense of I diligently that But the You've one with are is are associated me with And reference, to that with out that heard number obviously over about to need. highlight couple kind we $X think point say

through we and mentioned will the infrastructure, earlier, already spent, give So if around more that if the operations in investment. think, and to an on you as the spend, a multiple those re-look that incremental us better to current that I opportunity required opportunity that year. the that are with, base, us reprioritize off that And at highlighted And approach, make the we there to right? gives too, we is categories every that we you And kind make one opportunity that re-point addressing not are There's reprioritize, rolls what the incremental will billion to also in base where that what's can been faced it's order. work spend spend So re-spend we plus dollars, okay, to that's of then there, and of re-spend will I the made. is dollars. we've until an those and

an couple types Now, on be points these increase that way is percentage a the in pretty put can absolute initiatives. of dollars of significant to work of

the And risk of or there we of to Mike I'd organization. us of us centers opportunity second to pointed terms data one at the have -- and required the address the -- separate let thing remains and when opportunities In the spend our placement for controls, have and from for me highlight the them. as well, is, look around where out, also people infrastructure ensure look investment to at, to right the away

year. at to from this the So our had footprint to us some make spend of the COVID we've that for look off of some roll

at to coming dollars out other So be look that opportunities alone warranted may let for we are us there capacity this adjustments that COVID-XX. have of

many -- spend constructing to now. And this to will the And what order. that process that takes process through use and budget the with I'm we're so are highlight dimension that there we associated puts my the trying is

timing, approved state develop so days or between some executing to after a have against. execute And and we've of can current days out actually we target. XXX some or the points terms towards the move plan order gap, got state In that end so then an continuing a or and which to identify gap to our XX

of record and and out And and this. But base total dimensioning we're very pointed our dollars be the some will for continue And been this, so, profitability timing now responsible responsible as relates expect improve we do to others again, that. and that track and think got a earlier, being sense the right? gives and we've we're it around I you about investment expense shareholders you we again, disciplined looking how returns as should thoughtful I to that mentioned and as to has as of and thinking

Saul Martinez

And No, able helpful. Okay. latter hopefully, succeed to point. they'll that's be on that

and little mundane more Just up bit quick a follow a of a question.

[ph] clarification. a correction think I of or more just

losses be this fee in Mark, mentioned, no to you civil it tax similar should this fourth quarter? quarter that think in that corporate quarter [Indiscernible] with I pre the I and other

Mark Mason

Sure.

So $XXX ex the million.

see, that we to penalty be So the is see levels excluding I fourth said the million civil we XXX likely the $XXX roughly that quarter. the money in

Operator

the from question Usdin next Your is Ken with line Jefferies. of

Ken Usdin

go to you to morning. really a expect Mark, Thanks. different could that of start peeking until mentioned NCOs next the year. I Good end if topic, you don't

I So year time kind us to the the curve it's next over if through was just And or walk loss you're Thanks. a expecting so? just just you shift can wondering how difference? generally of appear

Mark Mason

Yes, sure.

coming expected. are in So, to seeing across forbearance quite portfolio, rates that think about again, look And we're you stimulus in the -- proving than have when when we it's higher place. the programs be consumers the resilient the you payment and been

quarters, looks And likely delinquency curves see towards factors level, the see we to to loss as to end fact, assumptions at suggesting, look the likely and -- we're that unemployment, the regions. of assumptions But That's around in is going aggregate XXXX. we're come all as seeing. we're next fourth back GDP, those around by vary over Obviously, of or of into losses quarter number it what play. they're though buckets, what and so,

kind that on end the referencing but was aggregate of Asia. what was see at look in LatAm, in earlier, when so, And may you portfolio. we back I the

Ken Usdin

Got it.

eventual outcome type to in a of positive the the ideas on what of to might tax when Okay. what to we depending down, And had a outlook, the Any if from being I the on follow the to either question potential obviously, could taxes, and able the down least, rate, about taxes at guys of And impact back election, in went XX%, have terms to up the DTA. just directional the plans. on up rise write change of you terms others just DTA? write of know, a and

Mark Mason

Sure.

XX% into effect did about went tax result so, exactly likely by $X in but see, the to increase in DTA or our to happens, or hard So, in that know we see and It part it XXXX. latter do the event of would a what billion. increasing rate we

being rate So, a to of And to rate our year. tax given impact increase $X dollars level. contributing income our that, DTA, as less one of and less And of higher result close levels a usage level, rate our expect our roughly a disallowed then, a in in would to the that income that And to to CETX with ratio. corporate obviously tax billion time terms the have close detail about billion. tax per return would we higher the the of being rate,

that a the So moving sense a couple little should that of you of happen. bit gives of a pieces

Mike Corbat

And reversion to or there Mark, comes I an remaining think important nuance is what a out between taxation. territorial global

remain again about I think which, the with would operate benefit what we people in. of likely talking would a jurisdictions territorial, are it some us rate today average that global of in XX%, about is tax that certainly

Ken Usdin

Yep. point. good a That's

Operator

with the of Your next KBW. Brian question line is from Kleinhanzl

Brian Kleinhanzl

actually first and stabilizing its what the the of potential get that it's statement? kind factors the fourth saying you level? you think be that stimulus Then heard quick you look But stable of deleveraging that going stability? in you maybe Thanks. XXXX. consumer that, NII. off confidence gives further are that the you if to for on Did to quarter that outlined stimulus Good. about to leading One I we Thanks. question as just some out after

Mike Corbat

Yes.

of GDP. its talk is there unemployment is another again, And on Obviously, current roughly kind based that terms include improving of improving trends assumed seen We've a in the we're certainly of later sales assume that to of some XXXX. bit the QX. of does so, and first It quarter. impact. quarter in stimulus of that see activity in over quarter that purchase look, that We've that terms of we in kind improved in seeing terms of is continue

days We of to early the in as October. see continue that we even look

And the is another the as important liquidity that's so that in factor. influences obviously, and would And that out overall well. playing terms what a be NIM then the happens of factor in market mix

Brian Kleinhanzl

the well? expecting So asset question cycle? to side, are asset NIM. yields you closer as repricing mean, on bottom are I a low second earning you level? to kind you top getting closer yield think earning rates the you be So think to about at the are as if Thanks. about yields where the the maybe the And of the stabilized on I mean,

Mark Mason

Yes.

the in some -- have, we that rates. in assets of the that in put deposit seen levels market, with mix of quite terms terms from work. coming a, in seen obviously, a look, to of the to terms but also terms the pressure the pressure demand terms lack frankly So pressure We've we've loan the of high in NIM, the the of of of in of

liquidity how on happens to pricing ultimate And of that's an the that how what an going is how near market balance really evolves. those asset in NIM factor to have The so, subject important play output is sheet out and And with evolves. revenues [ph] that. the

market bit continued little of we that year. in so, towards as play of bit factors end the some how a stabilizing out, a of terms those And see but uncertainty well the of

Operator

is the Piper next Jeff Your line from of Sandler. question with Harte

Jeff Harte

more feel question. one order have remediation underway consent regulators I of versus views fast have related that the been of Unfortunately, Do guys. on existing just afternoon, moved adequacy for Good projects have not a having you kind enough?

Mike Corbat

Sure.

Jeff, moved holistic have that words. not say would I use my So have fast to been enough, and not enough,

us things. said, look us better brought again, And so But that. of these think in I about give a this I will others we've gap and to analysis think again, sense help as at

yields. And sense we'll think a see and we've got approach the so analysis the of right again, I final what But direction.

Jeff Harte

over? starting necessarily Not

Mike Corbat

We've to I make We've the not it some the may think through example, at to is more an crisis, how broadly. of good in real to manner. a over we've make kind live been to But again, better been raise in be us as this Again, as remotely move of And larger I get continue bar again, you think to the a remotely to critical and decisions. particular, we've ability if on and no. able which -- managed think in continue this defined to faster kind think ability of institutions, the timely shown I refined regulators time make life appropriately more and been data. test. terms our do digital, as and act to able work I expectations. able There but accelerated the or the has right to think I may the pandemic look their areas where decisions Broadly sense that,

Jeff Harte

are? Okay. the And you're down of things How fundamental. currently bit macroeconomic related specifically relatively just exposure some your Mexico large and Can credit you kind helped market deferrals is in in trends a the business which something down the Mexico? like about Citigroup what upon a for concerns. much And seeing geography has has talk there? the expectations

Mike Corbat

sure. Yes,

than eligible. So to had of be February I Mexico, although, world program less look, mean, be needed the forbearance, U.S. Mexico, also as in to as days the customers end of similar unlike the other part to the past of of the XX due parts

see by what tick buckets the our loss we, playing rates customers through in and look up those impact that, Latin delinquency the America a, we losses. a losses in and also a would the the end kind to -- way come to there quarter, largely of is Mexico for you you the at saw certainly of And said, with what XXXX. into driven so of Mexico peak we in That comes overall of of higher And of for way NIM performance. expect than the sooner when

second In the is in third exposure, and loans loans. the a we in risk half a about more half a Mexico, terms credit target $XX of more in and to In of there, than bit billion remember, personal our that's little about price than the and total quarter. of broadly quarter, down of loans since the billion between, ICG. corporate of little card quality segment in country XX, our exposure, we At GCB loans. consumer XX or and about peers customer of are is $XX And Mexico terms tend end bit about higher accordingly. most XX And that

in a sectors another would relatively that that the a And our of in so, XX% in government, out are lower to of expect way. layoffs, play and have favorable loans risk like payroll employers, there's concentrated pensioners. portfolio for And we then

about towards weights think be that's than portion our is And in XX%, And the too, the that helpful less should so book. it as mortgages we then quality there's LTVs XX%. of of

speak And too, should so of that, the quality our books. to

managing feel we appropriately levels overall, So of as are there. reasonable performance though we're and reserved,

Operator

line with Portales. is from Charles the question next of Peabody Your

Charles Peabody

had just I on Yes, up some follow questions interest, revenue net guidance.

stabilization entered as word the using kept we You XXXX.

big markets if wondering drop revenue the before interest the the markets drove my can pieces related between mix net it expect to a So that in to weakness the core You bank of does first I about the you related stabilizes? which fourth revenue. then that stabilize related? question you is, imply first? the net further quarter those what question in in interest of And is, was and talk page on then XX, show And saw

Mike Corbat

in into as was total of interest factors to so be so the kind of structured referring and important for with fourth Look, it's non net impacts, are as at that part that And of heard I is the you've in quarter revenue coming fourth the expect be to clients whether really to the in in revenue stabilization markets look near already. Yes, quarter Citi. because and of form just me go that mentioned total I revenues revenue. how near. the and to mentioned to we clear, the, there for stabilize the the The I’d many nature transactions before, revenue total

equities think that in terms total in you our to, I markets the in as the up light quarter, and important And we of I there. And strong at so, look I revenue, fixed performance as revenue mentioned, total it's revenue there. income, mentioned of strong, mentioned, earlier, very total the in is as saw

around how clearer. and to as around and predict reposition books, with to some Brexit the those candidly, some their environment markets an we case stimulus and And so, through light customers fourth quarter the exactly prior that of part strong of Europe, a uncertainty normalization is managing hard things quarter clients into that as still lower election of very vaccines, take and we're place, in go in the as in of but than we see speculation that that the become decide

mind, I so the way a will it, near revenue think of that And takes. have in in revenue keep but total fourth performance, about we and show will stabilizing, and puts have think markets is quarter the markets will way likely revenue

Charles Peabody

And same bank. core in up markets Would the let grow ask NII the related NII fourth between that quarter just you core question, mix sequentially? to my about follow me bank expect and question actually

Mike Corbat

that will interest expect revenues quarter down Well revenues the would I expect? the aggregate I our fourth of kind would But net show year-over-year. again, of non-net interest and relatively stable. two,

Operator

question is of Juneja Vivek JPMorgan. the Your from line with next

Vivek Juneja

Thanks questions. for taking my

Mike Corbat

Good morning.

Vivek Juneja

Mike. Morning,

for the the made. consent the the management regulatory orders the the On did disappointing not issue, to quite it’s regulator's in read that incentive risk whole of account comp, and comments about practices

can the in well which didn't other Given is a senior should cornerstone we that And we comp? as expect what a what risk you And, should talk expect, changes such board, as why management you senior changes incentive the result? executives, last crisis? about since prioritize as in management,

Mike Corbat

seconded the of or the the making sole of have those practicing consumer different you executive a say who of terms markets appropriate doing in proper people look down waiting. functions. things the notion in balance the it isn't that number obviously, each the they're just isn't, business part here, do accountability. of management we question So than area in a it's how executives, you've And or expert. But people create it work, and these at kind job. the it many are it And the them of I involved a have around you and proper I the They're comes team. into of what people So work in I fair streams, responsible they're speaking flow. the taking got a actually which more think think processes. accountability of that kind number [Ph] of to because their executive don't you've They and just expert, as they, their the processes sure And number And many the that of have job through work team. the regulatory are instances goes it's of And for that practicing would of practitioner this or or those challenge that? broad streams is, got in in

I think right the it's striking balance.

And or on it's -- be of balance creating the in the to properly. kind people of right there? in drive in And the so an get so in right as outcomes and pieces firm delivering example, risk financials that expenses, are are responsible for should the there someone directions think I profitability right behaviors, both

think it's the my way described I So broader written, interpretation again, is that actually you've the than it. way it's it's

Vivek Juneja

that so people are able adding to forward? how do you you'll as people as responsible you And this? more thinking to So for be result look some does you a mean, be think fully hold

Mike Corbat

we last have the we of projects. Well, risk in we've added people thousands controls of year been, to we've people beginning and since these the year, and were adding

in tried those I from a resources matter strong expertise we've from and other been external to other us key subject things, without and we've as to number and think we a So experts, these think doubt, made getting bring firms in we've of that industries help hires. bringing about very

single I also people think remediation, i.e. their responsibility think not and say making I primary, made many this strong sole but some would terms delivering adding internal we've in of very strongly what of case I their in in just terms people in moved moves we've on. terms of

the again, around then talent, this. expertise, committed So the against right the absolutely delivering to resources, and accountability yes, having right right the we're having right

Vivek Juneja

as we of, but have mentioned, this help CAO, kind help brought Karen transformation, lead in Mike, organization. the Peetz to And kind in and across you obviously to may of the

we people say, the getting So it. need in we're after that bringing as and you

Operator

question next with Stanley. Betsy Your line is Graseck the Morgan of from

Betsy Graseck

mentioned, literally you the you June Hi, Good know good brought USA, in morning. morning. was Citibank Mike, Yes back June. so, I Karen like just timeframe. And of CEO became in like

I at you of this and kind of expected So looking a was, on while, I'm been you working kind some this probably must was all for I thinking, I guess you've expected, thinking have already fair? to regulators, is the you executing surprise consent you? a surprise Like, from is partially it a that that this order, is street, but be requirement really to were the might on

Mike Corbat

work working them these, we these have been around a on we've streams, around Well, while. for acknowledged, as

woke gee, to new or go it's like, sudden, up all novo of So one day project. a de as not going said, of some at things to, these we're and we going we're

a and So that, would would these really don't that we've been we've want. has I the that while. what that again, together. say outcomes focused taken I for or we've a Citi on on projects I been approach them working And would is I at in individually, we've think or bringing yielded regulators either ways say historic necessarily either these, gone some as serially

through modernize so I this us became fortunate processes we to that and we go And able critical. bring went way data example, and your the be down really through able Karen these some who when me expertise to join that we're with And lots sure to through feeds think apparent and Because it path, streams has together. is a data data I compliance, think to through of holistic needed it. have been approach that we board feeds about risk, go at I be making the an at these our and and to approach others to, this as we're data think this of a controls, think to you as body very and create feeds work taking to have data

do we So it do holistically. do once, we right, that we do it, it it we

think I new. again, don't word for work And the some streams so the of are

is holistic I broader, some areas newer. more in the think approach, encompassing,

Mark Mason

was And beginning Mike, that year dollars spending and just dollars the us spending, billion as as managing is this the can spending started started incremental And much to expenses we make dollars as to still in spent billion that we're the terms incremental year, way, I in wasn't what already, billion traction total the we're we we well. not XXXX that of right. kept, incremental it Alright. -- our having that And and think that the of we by point we're something do in responsibly. required at again,

Betsy Graseck

the I X% cause, point, that's at when ROE. looking a I'm a look interesting stock at for, it's stock. Yes, effectively priced

billion improving the to to obviously to on this above ROE. is Okay? point up that like a is hey, you are Mark that hoping you're -- execute your X% much that a expenses because which going And X if to are you profitability, earlier, That's drive today. expenses. planning right go X% mentioning say, increase in And were

it? of Is some what next over So the I course profit help can, mean, focus you us improvements of could kinds can wondering, Is Is it current better customer funds? Is of big your of incremental the what understand what I'm years? on with down about thinking deposits deposit, base? it couple execution threads customers, you are? cost understand bring think your help there? core it you're you us greater that

Mike Corbat

a that There whether try our additional earlier seeing are more to traction TTS it's relates terms that we there. business to do and mentioned structuring look lot trade in of are payment components I we capture it's unique are clients. lending to we markets our that more there. clients law of as whether linkages corporate Yes, capital multiple our doing capabilities, across instant in a and products between right with spread there. it franchises There with doing opportunities

the when that in Asia U.S. the I XX% more the And we upside, timely the management the more you think we improved the to to think processing, way that costly output quality capture think activity, fashion. there But wealth continue investments and time growth, seen are removing is But linkages of an there's improves in straight don't this automation less will we you there's also those think there's are the steps. so, from There manual, again, where we activity space, we’ve also wealth benefits it manual growth a more say help more operational when have the upside quarter, in in more, of there or opportunities are grow top technology, line across over you manual will through replace or franchise well. performance. with manual we manual in when, as an remove opportunities when

we take as credit, expense top the adjustments and we both capacity as out host ultimately go XXXX in of to line, come profitability improved decide of and part the say from as a then so I forth. other, And so this in and cost XXXX that including we so getting other including crisis. may play of well, through beyond And into activities, benefits getting items and on

Operator

from question is Your line the of Gerard RBC. next Cassidy with

Gerard Cassidy

morning, morning, Good Thank you. Mark. Mike. Good

Mark Mason

Good Morning.

Gerard Cassidy

you give your XXXX. CCC, some you've in us very the they portfolios. the B, that ratings given at share consumer Mark, on haven't quarter you us the fourth commercial really investment much with of good you side, moved terms Can of since to grade us detail look on BB, when

XX in and terms you share or and energy travel you're over risk months that So are these what risk leisure portfolios, the you what so? us give with see the most seeing portfolios the and can losses most the you credit next hospitality in portfolios, the ones course, of the still

Mark Mason

Yes, yes, Gerard. sure

saying, let of our me out focused you our grade appetite, that the the investment as advantage have me we're client rethought risk of also start ensure adjusted we best really framework, know, our can the to we coming on clients. of take offering, Let our last crisis, multinational have type risk clients breadth but we by on have focus that

these portfolio, terms And sectors in skew that have a or those in XX% industries. grade not on helping XX. to that in in dealt them instances, of and have so over in and sectors investment downturns, we but I their these crisis, uncertainty. operating history it go important selection. names. it's leaders so the long each these that only cycles, through this that because with are to so about that ratings to I of expect towards, clients We've thoughtful of of, way the through client banking when you maintained a our And, And you expertise deep time. been we the some about all of our we the note alongside can in got think through what When staying see and that why we're we've you we many clients respective committed got, industries, name, we in to being speaks experience many page includes and the manage the to And of think of of speaks quality we've point

there, the tend whether structuring space, experience guaranteed mitigate at They look and you tend there secured extensive risk to So to valuation extensive secured. We've exposures agencies. collateral or that's there. our aviation to credit of we got with export by be have experience with

You lending cases; look in in securitization many is at and there autos vehicles. the

So, and obligors risk is of bankruptcy with case. remote in consume that underlying the

at and with is fall. periodic of borrow based energy a terms reducing helps look borrowing of that basis -- You And that in through redetermination. lending when exposure prices oil a lot go that reserved

we the these to in experience, have. sectors in we feel these taken we the through our given it us I reductions, are we you reserves names we we so as with were put have, good and at our deep we this exposure about the enhanced and actions. we impacting look you reserves look cycle. and about in through we've feel in well And that activity that the this mentioned, good them. portfolio went about through at clients. we with manage that feel pre-crisis we And to downgraded have we have, the And early And with manage proactive feel just sectors, about aggressively positions certainly feel crisis place. clients think In these these good where monitoring the our ability But that good in as

Operator

remarks. call for the turn now back will any over closing I

Elizabeth Lynn

day. to if again Thank nice any you a Relations Thank all and additional have joining today. to questions. reach Please free out you Investor for have feel you

Operator

earnings call. your XXXX This third you concludes Thank today’s participation. for quarter

may You