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C Citigroup

Participants
Elizabeth Lynn Head, IR
Jane Fraser CEO
Mark Mason CFO
John McDonald Autonomous Research
Jim Mitchell Seaport Research
Ken Usdin Jefferies
Matthew O'Connor Deutsche Bank
Steven Chubak Wolfe Research
Betsy Graseck Morgan Stanley
Ebrahim Poonawala Bank of America
Gerard Cassidy RBC
Mike Mayo Wells Fargo Securities
Vivek Juneja JPMorgan
Call transcript
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Operator

Hello, and welcome to Citi's Second Quarter 2021 Earnings Review with Chief Executive Officer, Jane Fraser; and Chief Financial Officer, Mark Mason. Today's call will be hosted by Elizabeth Lynn, Head of Citi Investor Relations. [Operator Instructions] Ms. Lynn, you may begin.

Elizabeth Lynn

Thank you, operator. you joining thank and morning, all us. for Good management's that which website to is like based may to for uncertainty presentation you remind on are circumstances. which our I'd and available changes are today's download forward-looking statements expectations in current and contain subject citigroup.com on SEC conditions included and our XX-K. including, the from precautionary our filings, referenced differ in these in of statements Risk Actual results, of may variety including capital, due today factors those and discussion our other financial the section limitation, materially to a without statements Factors Form XX

Citi, Before I also who incoming will get the leave beginning and to Landis, Head Citi joining welcome call next month we our started, I'd be hosting Jennifer as of October IR, this like turn in the years. past Jane. over your to role assume you thank new me for few over seat to let partnership it a support said, I'd like and to that within With all

Jane Fraser

everyone. to full the quarter and our and going results against first good my Thank And priorities. again update you of then to discuss am strategic I'm join I morning as you, first, today. progress you the Liz, to on delighted CEO

or quarter, $X.X in the $X.XX billion For per net reported income share. we

exceeding from is spent of this as earlier London. confidence. I came with week clear corporate with for significant release expectations loud credit and We over my And also the an clients the it growing in course comes of consumer improving continue just macro-recovery evidenced across conversations to and allowances in of through the and pace losses. benefit macro-environment by the another Indeed, globe, the

optimistic vaccine global of our expected trading QX normalization to continued challenges the our the have we of investments. volatility contagion as accelerated we clearly, result, institutional are parts a world, striking about compared that our franchise particularly mindful in of several due the and of In momentum equities businesses, to income quarter. fixed and in a in we the ahead we had to of recovery deliberately last some but and year Now, unevenness saw the distribution strong remain

do saw with very Services, franchise Treasury double-digit the ICG in than in in to with fee fee XX% growth and over good momentum for higher be a in and the progress M&A Solutions Performance specifically our healthy ahead Banking strategies and remained Trade the in bank. our solid our and revenues Looking volatile rest markets expect fee good revenues Investment Securities year-over-year pre-COVID the private in We pipeline year. increase growth forward, we to of levels. very and

market clients, of shape. Consumer a by a sales continues elevated loan takes is Now, lower rates, recovery rates perspective TTS in from with our increase payment for while we purchase network revenues now to In we well Banking, are we our how while the year-over-year. business spending pre-COVID post-pandemic levels book and above global the were in XX% impacted positioned deliver cards, is the here be backbone impacted and global like unique by the particularly as the share

Internationally, in year. We our business the across innovative loan custom and continue investing franchises. this of half as we by consumer into Card have is our the picture expect consumer our discussed, to in translate the Cash In demonstrated we market the momentum growth AUMs both well-received of the And to are budget. U.S., second deposit June. launch our home for the as in growth good we in

Mexican Asia softness in the still loan and is outbreaks. growth the there while economy, new despite returned that's So, in COVID

maximum which rules. $X billion Federal we XXXX, permitted two Reserve's our to returned capital, the was to close the for the amount first Turning shareholders, quarters under to of

our in and above committed forward, are over to any returning Going to excess invest amount capital franchise. we necessary the

would on So, through capital a won't that XX.X% to Tier ongoing and to, as the quarter excess standardized impact target increased basis buffer common We a program. the stock our X% and at we have return capital approximately ended while result repurchase equity managing stress the healthy to X recent of our test, stress be a to dividend of Fed's XX.X%. shareholders

value Lastly, our tangible over increased X% up book year per to share a ago. $XX.XX, from

priorities; on turn of to let's Talent. our we've the made strategy three I'm very and refresh. Now strategic progress our Strategy, with pleased Transformation,

for a process plan are isn't owners. start running and off to We have businesses EMEA exit moved and wealth regions, to those these we Asia competitive, terrific very first the to for encouraging markets the begin round strategy. and we surprise swiftly in the bids because right consumer In in a our was which sales XX of the are

We are investments and strategic in making this product talent acquisition. and technology, already seen client in have significant capabilities, increased

to refresh do our principles to by being you being clinical, the continue in and institutional We ensuring connectivity consumer guided across both strategy our focused thorough outlined and the four work vigorous earlier and to businesses simplification. year, I and

afford in overarching the Our in commercial the these is peers connected the And the notable of most wealth, three the most growth with investing prospects are and growth, generate return our banking. gap that TTS, us. we franchises franchises which close increase the very goal the and by will I'm returns will and confident drive

front quarter which we our also We're we we first the to of for year. to so on during we decisions As vision to will intend to Investor the you share an comprehensively more forward put view. firm hold them entire plans our have in going looking of next Day, our the as in you presenting make we with far, and strategy done are

against for executing hold you So, us it. accountable can

we it's on expectations quarter. this body submit discussed and working to to working our last we're very the transformation. significant, is exciting As and our are meet we in This and work to a plans we of hard closely an diligently regulators also with their quarter, call our them intend also

our orders out to the an to focus investing is bank. We here risk well our less and intense in orders to want serve of need excellence our than environment, themselves. the in and an consent beyond set work our also the control infrastructure but in world. addressing while increasingly digital achieve nothing this we We've transformation, clients modernize Now, the means goes

last So, talent, investments scalability we TTS. that will and will example we improve in let risk, in automation have revenues firm me caliber to you position making, talent been our grow ranks These our and position made in months. experience, us leading the our drive commercial progress in preeminent have investments the give as best-in-market we're to our well the client over bank. particular. global controls, BCMA attracting the few enhanced material delighted and and and platform, where bank, as of We've the hires will to support finally to lead lines data, strategy help the corporate as an and I'm existing businesses front of enhance in the with our with me will the And retain of investments wealth, efficiency data transformation.

accountability. and We firm high-caliber will this them new of and our combination excellence enable continue a existing pool forward culture in and providing invest to take us perspective that of and and with the opportunity leadership own to excellence, our growth urgency, talent with new people,

years. happy our mentioned, to to know, Mark, the is Lead for to be she our a it she then Investor past Mark Now, efforts going both several as where is we questions. Lynn to before and Liz we'll And And over like I work turn Relation her be as our will would I you that, going through over all do job. BCMA your for leading presentation. she thank great Finance to With know wonderful go take

Mark Mason

billion, Thank up losses other transformation $X.X as lower the by good along prior investments, Revenues card markets loans continued more well and as partially relative in as remained second-quarter interest print XX% a savings. declined Expenses consumer. well morning, by constant improvement X% strategic constant outlook. the to credit an consumer In $X.X XX.X% were a end-of-period expenses as RoTCE. in as macroeconomic reflecting institutional continued of in net on declined year year-over-year, a up in lower year, in from $X.X X% everyone. income than Credit were reflecting rates. fixed you, offset as year-over-year, EPS offset normalization loans of normalization reflecting ACL low dollars of and along portfolio billion, well reported with net across improvements of Jane, higher Starting the last dollars, reflecting of productivity X% our release performance rates strong with slide with repayment our the billion Citigroup and X, $X.XX, investments income impact

X% year growth note year-over-year, of starting emerge consumer modestly would up see and I sequentially. to a loans continued are clients. that time and pockets in with Although, Deposits grew engagement some up corporate loan for our the were reflecting first we over

mainly of the were outlook half basis reported more first by the X% income net did and XXXX, in delivered the strong of fixed billion the benefit card of billion ICG year-over-year, $XX a X% Total growth balances in revenues constant credit and we roughly Looking we lower XX.X%. was revenue in excluding about over year remainder up $X total consumer through in billion XX% $X see moment. and in as dollars although X% declined and driven the talk our released a and a RoTCE fixed markets consumer, and at across in we in constant fee income of in for normalization in of on markets. Cost year. income midway I'll dollars reserves expenses roughly

noted SCB remain capital continuing capital in to $X well as the we Jane earlier, year. to the framework. provided our flexibility given as committed far by shareholders we excess in any billion returning roughly as this franchise to Finally, And returned so invest

business. each the Slide Turning Group. results now shows Clients the to Institutional X for

ICG period, year. decline in lower as transformation Product strong particularly fixed million delivered as XX% and the income investments XX% along significantly considerably by given And XX.X% X% Credit shows were delivered efficiency Slide $X.X were X% prior-year a with of ACL were revenues a for expenses well up offset primarily lower in from a compensation fixed dollars quarter as the revenues Institutional X in savings. in EBIT driven markets. comparison in down investments on last Group incentive second billion, Revenues more costs $XXX losses. down a income strategic mostly return roughly increased constant up ICG in mainly and markets, quarter, by capital. other credit the detail. reflecting For Clients net were to decreased allocated the release

non-interest for in confident in fee are component see Private we However, quarter related Banking, Banking, markets are across the and outlook the and were the year. Commercial Securities underlying franchise to excluding including Services, continuing growth we of robust revenues businesses back fee growth our half Bank. the and strong in strong XX% this our And engagement the TTS, up client continued Investment

past Looking underwriting. growth the X%. in volumes as flows And at end reflecting on revenues of roughly underwriting revenues of well revenues as the Payments debt recovery momentum across of with significant Investment see higher the more cards. by X%. offset X% growth the of detail, over growth impact as client decreased and results the as as of were and conditions. Solutions largely solid In banking XX% cross-border were quarter, up client Treasury in greater equity fee improving the decline offset growth X% a than demand M&A a early XX%, TTS by with days in loans We're reflecting in revenues engagement grew lower down interest to clearing rates Trade revenues commercial increasing continuing macroeconomic well in and year as Banking roughly in were trade, side, the in and our Business XX%

was rates revenues results more in a of with investment growth overall up wallet Income results looking grew Corporate impact both services of period the the clients, XX% revenues volumes higher normal spread which fees the by revenues interest Total lending offset a rates. decreased both revenues existing reflecting XXXX at benefit growth across But, Bank did the Fixed and non-investment primarily by Lending lower momentum XX% lower in our up driven given revenues a and grade. quarter, in were reflecting partially SKU products. prior-year the were strong year Private from X% last While was down not strong comparison XX% with markets decreased versus and new XX% DCM driven all products. grade to quarter our second and second to volumes. versus by year. all securities

client versus remained reported robust engaged last revenues constant historical primarily reflecting revenues with and finance by were X% prime and year, a dollars. investor corporate In However, XX% growth securities and derivatives activity basis client with our driven in both favorable clients in we relative performance revenues good to and steady in up X% average. were both Equities conditions. services, the up market on

revenues existing by Here volumes spreads. and new with strong growth we custody saw under by and in both assets fee lower growth clients partially in settlement driven offset

strong offset Finally, that income looking which good fixed I would the as the we've expected seen at XX%. and contribution up over as Securities ICG, first-half from Private also well Investment a helped revenues to results in markets. Bank Services note results Banking in normalization equity are markets in

Turning for now to Global in on the X. constant results Banking Consumer Slide dollars

healthy the volume-related Investment Expenses impact with by credit improvement lower GCB were delivered rates quarter, deposit in revenues. higher the low allocated of significantly Management consumer In ACL we partially strong encouraged return XX% with lower $X.X point an and versus growth from well ago, and in costs last release versus increased net last albeit as with continued offset up regions. costs three investments a still XX.X% year. in losses. GCB Credit spreads X%, year from our spending as more reserve transformation by seeing a by billion, continued And EBIT efficiency and year $X.X billion and acceleration to continued investments driven in Revenues as the offset quarter, remains are close than high-payment significantly, up decreased card declined the cards, momentum delivered of while along almost on balances strategic across we other reflecting For savings. XX% by and lower are credit last capital. XX% sales the marketing purchase on all

steady the shows we've America half X, at gives our North drivers, for Consumer for in seen detail. confidence the year, Slide our more in looking we back results the of Finally, as which half into the move the first of outlook in year. improvement results us

revenues use down a pressure and programs our from debt, better retail by higher from cards by decline lower it's but mix interest as and and pay also year-over-year other stimulus driven down lower consumers have cards continued headwinds balances. reflecting revenues, last payment Second-quarter declined to year, and is but in and on creating to continued driving benefiting both loss were primarily towards a delinquency on XX% XX% relief in rates shift net quarter XX% This from the liquidity revenues transactor Revenues last basis. branded services respectively, than loans our trends. XX%

with continuing are Branded and second XX% we by sales importantly, led XXXX. also both versus XXXX. sales pre-pandemic year Services, up up XX% were a the grew including in second see Retail travel In quarter last spend However, total versus And to sales recovery in now and purchase and dining. discretionary activity versus of purchase purchase sales levels quarter above XXXX Cards,

recovery in the So, also good levels. to that see acquisition news continuing the pre-COVID we're to returning spend is we're and

translate loan more to the end moderates stimulus of payment and to in year as ahead, consumers sales normal growth into purchase Looking expect return patterns. growth the the we by

Citigold revenues are AUMs. to in XX% spreads with Banking, mortgage America XX% That of International retail decline decline number and and show quality On and stickiness constant deposits well were a Asia. checking declined in the second an these contributing in up households in in for year-over-year pressure from the improve year-over-year, growth XX% as said, we XX% to Consumer relationships. bank a results X% momentum Revenues the increase as quarter XX% dollars. as and X% Banking in see and revenues. including lower increased X, by Average deposit continuing slide Retail deepen Latin relationships were down grow good to we reflecting Turning we our of X% lower

strong Consumer we this in spreads. growth the average increase on similar remained driven and specifically In International growth remained meaningfully loans consumer additional to at Asia you deposit are Average due U.S., are if And by international due management, assets X% remained year-over-year at hubs. in With the cards to sales significant trends. momentum lower we provides numbers Looking U.S., Management four primarily amount rates under rates. with deposit look down customer seeing XX% Slide global a challenge detail at card stimulus in the albeit overall, good payment Investment liquidity relief growth elevated a NCL and with to at favorable, the both X quarter. loan saw purchase delinquency the X% wealth other by XX% credit driven higher, and of programs.

and not in deterioration timing delinquency the we as in And into or results downward stimulus the and not depend of portfolio year Given XXXX the as expected, next peak trended losses whether and following credit both benefit. quarter trends U.S. today, Asia do ultimate will we the level delinquency a seeing are look we permanent of in first expect and Mexico losses the XXXX. rates on a in credit in

we suggesting in results is overall XX the are move a the a as good terms very who in as So, into quarter, in in and mainly healthy by quarter slightly dollar activity consumer gains impact than shows reflecting Corporate/Other, position momentum half Expenses for of allocated Slide a controls. one-time related the previously cost in to along and to up financial investments with seeing slightly year. year. rebound of risk infrastructure businesses terms, this the more were revenues dollar we episodic down disclosed we items the offset the were have similar prior to were in further last FX, back

year-over-year declined driven release to no year. the to level, at a Credit compared this of better As prior quarter periods change Citi the however, prior to by build impact recast have enable in we costs this previously, EBIT we mentioned results. had comparability a

this Finally, EBIT breakeven quarter. was

deposits, We've interest million for XXXX. range constant million loss our second-quarter, $XXX in pretax margin as of $XX.X interest a revenue non-interest Looking reported revenues comparison dollars remainder to loan the provided well offset lower the basis. interest million revenue as ahead, net $XXX day we net expect interest prior in cards the balance declined revenues. impact shows margin of interest NIR and by periods. was would to net on to and and increase $XXX in trends points, the quarter. Slide in lower year-over-year, of XX Net the NIR the growth to the reflecting in declined revenues driven quarterly as of markets sequentially, three continued appendix cards on offset for Slide basis extra the a by In lower in net the due quarter billion rates also by lower sheet balances stabilize modest in the XX partially revenue

non-interest billion non-NIR bottom normalization driven to $X.X quarter, in the on the revenues in markets. fixed Turning declined slide, of income second the by

However, we've pointing did fee $X.X roughly of recovery. broad-based strong for fee of $XXX over GCB expected markets, across outside quarters, And seen past and we per levels of billion than to growth faster pre-pandemic somewhat to return revenues a the two these see ICG. million quarter

through revenues comfortable Citi results, year, and at be to our expect midway full-year total these continue to basis. the are Looking outlook with the on mid-single-digit range prior we down in a

capital XX, be and will capital is Although our to key in talk clients moment. stable quarter, and On this Slide more remain somewhat to about support which to I the again strong us we metrics, shareholders. return likely allowing a composition which show different,

XX.X% as buybacks net offset mostly increased by ratio CETX dividends. was capital to income Our and

common billion of in share total repurchases $X.X the Citi $X dividends $X.X of shareholders returned in form quarter, of During the to billion. a and billion

by grew And share the SLR by decline was from driven X% book largely quarter, relief. supplementary per $XX.XX driven tangible expiration to ratio by net prior income. X.X%, leverage temporary our Our the of the a value

for spend few move on me let Before outlook our to a minutes we XXXX. on Q&A,

we expect as than On and seen But revenues mid-single different the we've the is non-interest growth digits be I total Citigroup, somewhat topline mentioned, originally revenues expected we a down stronger composition to do for half we continue we still to to in anticipated. by be the on to than for in fee year, the the Year-to-date, basis. interest reported the we net see expect growth should stabilization some by revenues, expect Meanwhile, loan in and strength half continued primarily growth the start driven of ICG. back in back end the year. of likely

year, interest significant here net we revenues are original $X.X while outlook in just full on basis. decline further the roughly from down So, holds, outside do revenues our year assuming interest this for a case a net year-to-date not base billion full expect

in again we for So, down aggregate still expect to revenues be total Citigroup, mid-single digits.

based on shaping a accelerate side, made faster part is to in up the on decision our investments be the refresh, On in work the what latest to reaction certain further to than we've strategic recovery. expected expense strategic

mid-single As we franchise expenses growth. result, Citigroup digits. to be expect a strengthen are strategic long-term investments up These that making total our we to and now are drive

our investments we accelerated holistically believe and Banking business. the including we've the and Securities for also Bank. down TTS, businesses opportunities example, strengths significant Services, across We've Commercial doubled and there Wealth existing For Investment where growth, on are like

capture recovery like the accelerating we marketing we in upside. cards this seeing given Finally, investments to faster are today, are areas

the faster and well operating risk efficiency, related environment decision-making, experience. mix of All well non-tech expenses These will this benefits our of the which directly around the this Citi time. as is work consent technology had customers to investments. X% XX% I'd an better bank, increase largely the will of year, we in have total these include transformation, as in expected modernize investments work to Meanwhile, over as client clients control to the order as are better environment, X% to and the the allow our expenses drive the out leading investments meet us spend to coming expected. which and and to improve related significant improved improved point broader needs XX% as And through that

to to as efficiently includes years. to byproduct we've we over this been additional some productivity And continue mentioned one investments few of see as a be of past making year impact investment I've the we pursuing. the we for to exits realization And savings operate related note, on as And past episodic the be look financials. as period. in the Finally, market as the previously, impacts will the will our could outlook transparent of possible are actions have very we ways we this during about clear, also done this these

the well our summary, will position in investments investments return close time. us to that we're firmly to feel gap peers making we So, these good and about believe over

She and Officer will earnings in the Relations. role And next that, as Before with Liz congratulating Group will Jen she her Jane Liz Investment has new to we IR of also team team know with a for me get all time I on Relations. XXXX. since the strong has would your two be years relationships started her Investor the Financial questions Landis happy welcoming With and new led key Head of all join be will been August take the on to moment a Citi Banking Chief I want you on be questions. to Lynn CFO, Head Liz Citi little mentioned, for our Liz call. ago. joining that you thank to hope of has since to of has as Investor named moving be I Citi with take since XXXX our my was Jen built been in a part over business. us I our and and as

Operator

from first Autonomous questions. with Instructions] will your [Operator John Your go Research. McDonald ahead question come Please, with

John McDonald

you there bit if expense the just I and wondering to could this the end more. unpack about year. for that at outlook comments was outlook Thanks a your the little for the revision

not raising been of bank only You're the kind expense that's guidance.

on this specific I as bank that run elevated wondering the next in half there the rate like here, expenses go you're year? So, with Thank how the year of doing might are inflationary is run be back that's a and big this how be the you. that are business this much expecting feel cost was much Citi or year you to of things to would of rate into does

Mark Mason

repeating by a decision morning, franchise, of said the bit Look, saying start I for how I'll little we we Good on very a remarks, my question. are deliberate what Yes. right. manage that and which the Thanks is in taking John.

and identifying, in spoke want are given that I some opportunity. real we to very the And as strategic going refresh. was of don't the we're leadership through window I Jane of particularly the going to what through not we franchise. a to, pace this miss with opportunities to so And team And thoughtful are along the invest go we recovery, strategy

me You've before. undoubtedly and will in high are mentioned returning. the that it's heard of And parts grow that franchise

Banking prospects and we about talk growth that when I Wealth, So, talk said, we have about are XX% talk TTS, we're businesses that at those the strong returns we Commercial like and of about are in environment business, normal so have jumping north that. a

the productivity coming to that. with but that right Inflation bank. modernize transformation to an we going been to that's tend do, thing do at as largely efficiency as competition is for be and savings we and in deal X% important consistent look expected - we side, year, that's course to the to clear expected particularly to labor again this again and and I've the drive thing offset On that very to X% over to largely for increase regular that look and that of a the basis, talent, continue on a factor, we year

to future. In firm this important smart as the the time but on an we're guidance we fashion out terms come in that period work money of I not prepares of this XXXX, is, that, I'm ensure give for going to a putting any to think, again of

Operator

Jim will with Mitchell come Research. question Seaport next Your from

Jim Mitchell

of the this sort that do think that does we we How Hey, greater is maybe clear bounce pretty a there's pressure and cards first just question. flat, up, or first morning. about compression the question spread just trajectory there the Maybe back. little on but branded revenue rate in spread. Maybe on balances that Can were good North Average America. teaser you activity, quarter? saw

Mark Mason

Yes.

you in look again dynamic of America, branded largely way - balances way in at our cards for So in of what down is average interest-earning average which about the loan cards particular balances, are by cards seeing branded XX% interest-earning driven balances. if the revenues, XX%. we're down the on And in North were

sale releases, relates those good that that rates lower of volumes, to quarter, on in rates now interest-earning lower we've of dynamic reserves cost a but lower is see really news high, is, pressure it's the as of the Now, purchase payment particular loan losses good benefit the it's meaningfully relative as average putting is and year-over-year payment said, that plays really news are in The up credit, and expected, than as activity high, to line. through it elevated. form we the quite quite but top is prior remaining

Jim Mitchell

balances. helpful All made the business, and significant transactor release on put investments right. just on you in and Wealth guys out do grow you pretty new count. in the you Wealth some press other to with hires stand similar making more target you are broadly head maybe saying clarification investments Where That's And then a on out that for the aggressive substantial a Asia markets? build and

Jane Fraser

and clients. all for example, growth a We're the pulling a single number across opportunity three is spectrum pieces the we're opportunity for we offering here, of different us have the are sizable us about as because Wealth brand, the all of the platform, lot commercial banking successful Asia, is Yes, I look, we franchise, the full into from. pieces said, to where the for pretty coming relationships, player. we in integrated excited The a the think the already be of client together

technology, offering we've the in we of have platform, very us. the see point seen in been the investment is, product from a pleased announcement and U.S. for in the the growing mix about so growth, there. a front line and you'll view, yesterday well, as talent digital investing self-directed upside We've with expanding been the which And greatest that well well as revenue

benefits in obviously I as mix pull single early offering, you'll progresses So, execution together but we revenue return bank. days the this, well see going forward of it behind terms integrated the as invest the think in as pleasing into growth of and this for this and

Mark Mason

already quarter, good only performance thing to are add we that, Jane, in I'd right. seeing the

just invest AUMs including client platform, continued in strength Jane XX% strong Private strengthening were as and revenues consumer assets to we invest which up that again management mentioned wealth progress position is so and that clients as opportunity up offering, XX% we capture self-directed the launching announced we here. further even So, we deposit towards and our U.S. good Bank targeted et digital were in ourselves growth and the cetera, yesterday while of investment X%, and

Operator

with Your Hello, Stanley. Graseck will Betsy. from Betsy Morgan next question come

Your with question will in next Please, we the line And question. move queue. is your open. to proceed

from comes Usdin question Please next proceed. Jefferies. Your Ken with

Ken Usdin

minimums? more of SCB that return in little about with the bit how to type you capital how or terms put your consider of thinking dividend should flush any context results, Wanted here be when but indicated a into a be got back and changes the on you the increases dividend in we bit and one on help out had that little you to SCB at you'd a just just you implied ask capital, could that just of us buying that might if from the prospective least we wondering stock, and

Mark Mason

the Sure. is can But the quarters the as through would in I'd bought as quarter, rules in average of way tell net allow the say four back income. second regulatory thing of the of as for, much we the that, way first you

we to capital excited so prospect very And the of continue continued about return. be

and relates results. it to As recent the SCB the

the approximately a estimate target The couple had into and the view. until effect well that's sheet the at manage X% As say PPNR Buffer. you from of actively been the Buffer go we CETX for up risk-weighted as importantly, assets a that eye the with that we prior ratio Capital have back do we results, this recent buffer intend Capital that we Stress is as Stress down. XX.X% includes somewhere between That towards more capital will will the to X.X% impact of bring X%, how third know, The X.X%. the point and drivers balance quarter. of stress to target And an so set at end of an

in you the as take SCB place, flexibility minimums do the given our that. actions, think intend we to to the know about - reg with and in capital decisions line we those a in with quarter, we with As have

our to will I skew is be makes back continue dividend a we but from remain at flexibility the shares we'll where us and for mentioned, And that. to quarter-to-quarter at it lot sense towards going now, trades, look as SCB. right as Given so, given continue of buying stock to the that of to XX%, the

Jane Fraser

in capital return close look we the invest capability a group. above over the Mark have and to degree piece I'd be and our Both of and as we'll confidence you to the doing strategy And and and of work excess with the forward high is, gap franchise around add what to returning capital that only on are doing this peers generating plans I forward. the going

Operator

Your from next O'Connor with Bank. question come Matt Deutsche will

Mike O'Connor

market up the you increase there follow buyback commentary. that to But below tangible a and or I to about very a sense. about books, are Is do wanted underlying power guess like stock just a the that ability dividend. I I to makes there, stable wanting understand to the the explicit just earnings kind keeping message to dividend. of dividend preference signal on limited

you'd at I up positive So, pennies that. of it do to much take just top that would by if to a it signal capital think want couple a to trend, least doesn't

read you Thank maybe on specifically interest you. So, elaborate bit there Again, on should are from on limits implied earnings little dividend? a into power, we the underlying dividend. any can

Mark Mason

Yes.

and is me underlying is I buybacks. to trading all, of very stock It's, making where sense There Let right. terms stated do be the no clear. there as message in at in

X%. comparable quite Our of to that is close dividend peers yield to that

and in no has fact earlier are And power areas strength the And our our in there earning we any is as continued so, capital to constraint the have of as about ability many take and going franchise. power. Jane actions know we on concerns to mentioned, I of contribute and the mentioned don't to earnings

that So, to buffer, have stress well adjust we to given direction as of the the fit we good capitalized, no message best capital to we our go again, the and in no capital and concerns our about sit or see spoke actions of investors. the underlying we flexibility feel we them as interest quarter and power earnings quarter to

Operator

your next Steven, line Chubak will is Instructions] from with Hello, Your open. come Wolfe Research. [Operator Steven question

Steven Chubak

just was to the as hoping was NII unpack My some I of I guidance. well. apologies. muted Sorry, Mark,

little I how think confusion a should interpreted. there of bit was just it be

billion year, $X.X year-to-date down we were we from that the like sounds and any there. - full shouldn't declines it see incremental So,

half. So, the that wanted would imply about rate that's sure a back $XX.X run NII the I right remarks. make way to just to interpret the in billion

Mark Mason

Yes.

markets, in excuse the We particularly me. also page, X% on again of kind see So - unchanged total do look but for digits, of the some or you again. stabilizing and mid mid-single guidance that revenues ex down NIR total see the at down

often it as of right, further Look down can we're revenues. fee the relates see it any as of the quarter. offset this to net You're component there what suggesting any hard I'm that coming the but will predict, to the billion pressure be in expect we half, that interest to or market's momentum $X.X is likely be given offset that through strength

Operator

Your Betsy next Graseck from will come Morgan Stanley. question with

Betsy Graseck

you're it the understand call scale get do Search around you the Mexico? question is I for don't really, as to the And you I with to important are you're pieces thinking in that areas know doing. scale business Mark, that how is you of a stand Treasury or the times because what doing refresh, I and could scale importance here. is question on Jane many help has the Jane could the have from I services I or ask like you're guess looking investors much maybe Global us what you how have out questions about as do - in of what execute that business

Jane Fraser

Yes.

of out example TTS a world. all, the digital we're franchises scale scale $X be here, for them And trillion of of very, and to more is got growing. in moving volume has - important a we've number clearly And day have in very First a believe the and EMEA made to helpful around expect we of the where point able very world particularly those that material Betsy, as you to compete the will we exit of this the local transformation in decision on our Asia-Pac we would that to part program where XX We be markets needed and ensuring achieve scalability the very business. scale didn't the platforms. is be

that consumer obvious firepower where So, be position where we think want areas investing focus an retain in attain to leading we be going we that. that is those we a either is going market areas to scale example U.S. other or ensuring can needed in to forward. of our the

those connectivity one are hear our very in it this, create Bank linkages finally, investing part as greater and the readily our And that from Services, more we're given retaining businesses around where pockets will is there businesses in capabilities. of us Commercial is come we between in we positions excited we'll scale. one, as more it by So, post-trade more very, by what scale aided I the focus obvious that scale our the think Securities the particularly going will where attainable areas provide pre us also forward transformation for from plans the attain will as U.S. say, we to I for think or and are and consumer be leading program

and So, have individually will collectively the strong. we franchises just advantaged different not be competitively

Operator

Bank question Ebrahim with Please, of will Your Poonawala from come proceed. next America.

Ebrahim Poonawala

the understand But that up risk expense being cycle Mark, next of that follow-up, investment year. for we this and as of quick little and guess Investor year handicap, about growth expense I you're as think in could mid-single-digit just over you investment few next next you you outlook the a leading to expense a Day we the in just bit quarter into - mentioned about strategy, duration Just spend terms we guidance both if see the terms deliberate creep first could years? think of deeper this, the dig as of further your the

Mark Mason

reiterate that are to and is this we very opportunities something around the we I do, control, deliberate making we it's see So, that to again, franchise want - right the Look, that right. is across thing the this Yes. again, right? decisions

to going do continue that. we're So, to

In terms don't right. of it, here, kind are of I any there think risk to surprises

Because move would is that's and compensation, around, very of expenses, in to from if revenues that work. I've transaction, If do component to more know go continue terms associated with meaningfully you in the expense to investment going work deliver them. this are base see tied those or we towards, obviously deliberate but the to money et to So, so expect the revenues aside on 'XX come and in we're put a can returns decisions we in what we the of there that cetera, money volume-related should that that. after XXXX, we're our again, certain to going guided to that different, fashion and benefits putting opportunities

Operator

question will RBC. from next with Gerard Cassidy come Your

Gerard Cassidy

banking said you Mark, business revenues. interesting the investment about something

said or here. or they were than I think higher, notes I'm higher XX% or lower. don't checking - my XX% XXXX that you I

XXXX you're So, business is somewhat your aware this still and the in and that trading nicely challenging, It above growth levels the businesses. well through investment banking pandemic up the came of that. was until we period,

guys amount to do As elevated Investment business due they this, be there people just you or to came we in it's do back What Banking we XX are see through think you businesses? next Global the to look XX months forward, you when in get to telling XXXX. talk those about your seems sustainable why they last to those in Markets, XX and of an the months. because in what Do

Mark Mason

clients transform take this that a consumers, pandemic too, levels, about how look think dialog at but that businesses having is I of their about incredibly some good it liquidity, kind excess represents Everything in by liquidity think there businesses, what what very environment. with remotely, how the is of clients to if general things and a very, coming optimistic industries manage really are so it, about want should think there Banking. chains, strongly of Yes. of view I'd business to we're saying level And their they or to many across that part representative, what have dialogue franchise many of in the with how the people which companies specifically general direct And think, are out from manage optimism. about you we to our to digitization, to they Investment they to start going continue model. their go-forward franchise work have. from supply for how to we across buying the be Yes, our do The think is terms pandemic. means how and

that? seeing expect to relative to are want while 'XX we represented we're a and you Jane, I normalizing continue what to than ended time. we momentum level share at to and to where we'd - we'd is, add so take in anything XXXX continued higher normalization, And expect take over

Jane Fraser

lot Treasury The trade as this are a with bank both think investment expansion seeing like. another I e-commerce in around nicely. with we that Mark, of starting globally demand level supporting world the their area as strategic moment, we translating our seeing are them at banking the Services you Yes. really commercial with flows that our into side addition we're the cross-border clients us is and side, from the to covered are very seeing the it new or engagement high in TTS that to demand well. through from well a own There client is a clients, up lot coming needing shift we to of banking and activity investment services of our tick through demand

I think So, there sense of is general a optimism.

year and around one really these does of the of have half We the things, have jinx a it you second fabulous we fabulous but a good continued a wants pipeline, momentum. never sense world to confidence heading give into of pipeline the

Operator

Mike come with will Fargo question next Wells Mayo Securities. Your from

Mike Mayo

just on value and mean, I'm that I not to fact capital. the and going is book tangible my $XX stock question price The your to blind is you're then ask re-queue. your question of $XX. real here

probably desk stock, your I to and think. chairs should and anything selling we be can silverware, you're So, buyback would you your

a sales where the gain lines, currently? those markets, or marked those when So, of to is along they first question to do those on loss XX the relative you're expect looking have on you are consumer in assets

Mark Mason

look. so, Yes,

decisions result we've strong very Mike markets. from those And as to tell surprise, to it's assets. no to you and What Jane tell we'll it flows those XX you is deliberate what we, to as good businesses is with we how capital. to not are as run there's financials. around as our that and scale, means what going and continue transparent you of that transactions, do just whether relates or mentioned, seen as here to But sit it and got interest see mentioned, will I'd tell continue losses losses buyers those think up that to for what that through We've you those think Jane freed us. where or I process that with it through gains from just be I given in, gains capital I'll I'm or make for specifically not

then we're at date, as First how that. been it the shareholders looking to opportunities cetera. above be can going deliver form our much And it as disciplined we capital growth of disciplined sense and looking in of buybacks, continue to to that about return cost towards makes returns that et can we've dividends of about to and

Mike Mayo

right, I So, CETX XX.X your above to return capital your this ratio was got and XX.X. clarify, if on

in freed up the any dollar point that from quantify assume much to and were at any would this you buybacks then that would capital sales. if potential include that, mean I how amount not So of

and willing So, correct? have is you you if could were lot buyback of a potential that stock able, of

Mark Mason

that that's and over bit to. capital excess XX.X the between and what of billion $X little the equates so XX.X A

Operator

from Your Vivek with next come Please and JPMorgan. question final Juneja will proceed.

Vivek Juneja

given about promotional what everybody that? that can comments little is a focusing and on back pricing you're you on any the you're bit spend, Mark, mentioned card talk seeing marketing you promotional in but seeing business trends in pricing

Mark Mason

and Yes. on say what I we into I'd lagging stated, are suggest back guess, expenses as bringing that is customers. card would we simply new as

pre-crisis, And mix is we're are the customers is normal our terms at or generate seeing as going always come has behaviors frankly, those of be largely in been that strategy, it on so - acquisition acquisitions case, a pre-pandemic what and are levels seeing and the branded on and we're and thus pre-COVID, the card account to less they X% that new look, Flex Loan, will and but far, those are Pay balances normal reliant acquisitions in cards offers skew as if like the seeing towards which products and you products we're Flex behaviors, grow. interest And immediately will.

Operator

more have from Mike queue question do one with We Securities. Mayo Fargo Wells in

Mike Mayo

An unrelated question.

Citigroup yourself gather with not Google and use up approach of initial doing lifetime as your Just, maybe customers technology third relationship Jane, new partners, the as you status it to about parties what's at and pairing the value. that with Plex and lower desire much cost the think through to Google

Thanks. you what's If initial think of your today we that Google relationship trade-off, heard current about thinking and despite the some haven't much headlines.

Jane Fraser

new early the the Excellent bases, Mike. think and important disruptive as both, look days around benefit customer of Spring a our is is there, around It payment there's doing the are payments engaged collapses Grab, tech are the kind our learn the experiences we've new partners finance into but ecosystems that new much partnerships we of big we enabling the looking for our we and partnership The development What lot We Hey the next on these also core piece, work Project about customer value and importantly these question TTS travel into with a certainly in no accelerated it goes as We is at part that the space And how particularly us to been side, us. propositions think lot, think Stripe, of ecosystems. chains these that got wholesale enables then of itself beyond with model well Bank consumer the as of and us, still about that is COVID with question. some and traditional just these Asia, that the customers, because a strategy it the of we're marketing, in generation we base with in is user do I as so ecosystems find retail, a very has stacks. learn it's corporate part partners. of enhance tech if one. We've in tap improvement embedded home U.S., U.S. partnership to Yes. we ecosystem, an not in Paytm to evolving. with

going tech that and the suite several with have Plex partner elsewhere So, the the creating States a in of we partnerships integration capabilities. world, deliberately about we other APIs are very in Google and and broad

offerings, ourselves or without of develop partners build an with So that having necessarily example it and it into other is we're able all that. to solutions buy Citi our innovative more plex integrate to Google

different with when testing with dates, available. we We share help with employees partnerships forward. and are finalizing be an it's but have disrupt features of one that going - moment. at actively in our important But that you the partner for only the grow many States here share and own that we'll us, to we'll one us the far We'll from

Operator

We do have a JPMorgan. follow-up with Vivek question Juneja from

Vivek Juneja

But, I capital. on question and have second a that's

do in you? year that's have you're obviously little keep a Mark, effect, target what terms about headed what's that, you you're not you're that a over can of just capital down pipe higher away mind, Jane, in that in GSIB know thinking or for capital, targets, because the into a towards a we'll Given terms bucket, thinking year but anything going to about from of all I coming

Mark Mason

And as higher GSIB pressure know, case go effect, the for and has consider the XX.X% case, that elements of the I and we there is the stack as of And can look, the influence of have the That of X.X% earlier, does holistically, in above you that all GSIB into control. reg on until beginning our well score market, us of you, our but been look in wouldn't minimums, with seen which Sure. many as us are mentioned XXXX. target certainly the consider it we score. that, liquidity and at entire capital certainly that -

and of earlier I sheet talked we without ability Fed we the PPNR, the gets what ultimately know part influence full we and influence losses out those can to come of about it we models, capital stress and how that the balance understanding know can stress it. buffer So, is levers our of having allocated influence

And we so will that. continue manage to

sheet will buffer are. you and continue well capital size levels And evolves. as as We have obviously that cetera see how as talk will the with they where the regulators know, at to we'll even GSIB a continue in But and the system. higher And still feel about being influence about a good right balance look to at we about again, GSIB stack drivers that we including et score.

will us have capacity capital we forward invest it again for create sense are that We to drivers and where that for the a intend to our that return we makes going sense otherwise good well-capitalized, and shareholders.

Operator

Elizabeth I would turn over now back the remarks. to like to for Lynn closing call

Elizabeth Lynn

all with Thank free a for again joining any reach and nice to follow-up have you us feel questions, Please you to in today's out IR call. day. thank

Operator

This concludes quarter for the earnings Thank participating. you Citi's XXXX second review.

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