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Last Update: 17-Jan-12 10:03 ET
Citigroup Over 3% Lower After Missing Q4 Expectations
This morning, Citigroup (C $29.66 -1.08) reported fourth quarter earnings of $0.38 per share, $0.23 worse than the Capital IQ Consensus Estimate of $0.61.
Revenues fell 6.4% year/year to $17.2 billion versus the $18.55 billion consensus. fourth quarter Net Credit Losses declined 40% y/y to $4.1 bln; Full Year 2011 Net Income of $11.3 bln up 6% y/y; Full Year 2011 revenues of $78.4 bln compared to $86.6 bln in 2010; Citicorp Loans of $465.4 Billion grew 14% y/y; Full Year 2011 Net Credit Losses of $20.0 Billion Compared to $30.9 Billion in 2010; Loan Loss Reserve Release of $1.5 Billion in fourth quarter, down 35% from the Prior Year; Tier 1 Common of $115.1 Billion, Tier 1 Common Ratio Increased to 11.8% Year-over-Year, Book Value Per Share up 8% to $60.78, Tangible Book Value Per Share up 12% to $49.81.
Citicorp revenues of $14.0 billion in the fourth quarter 2011 included $(74) million of CVA/DVA compared to $(1.0) billion in the prior year period. Excluding CVA/DVA, Citicorp revenues of $14.1 billion were 8% below the prior year. The decline was largely due to lower revenues in Securities and Banking, which, excluding CVA/DVA, were 29% below the prior year period and more than offset a 1% growth in RCB revenues and 2% growth in Transaction Services revenues from the prior year period.
Citi Holdings revenues of $2.8 billion in the fourth quarter 2011 were 30% below the prior year period. The decline in Citi Holdings revenues was principally due to the continuing reduction in assets, which decreased $90 billion, or 25%, from the end of 2010. Citi Holdings assets of $269 billion at the end of the fourth quarter 2011 included approximately $45 billion related to Citi's retail partner cards business which, as previously announced, Citi intends to transfer into Citicorp during the first quarter 2012.
Citigroup's net income declined 11% from the fourth quarter 2010 to $1.2 billion in the fourth quarter 2011, reflecting a $1.2 billion decline in year-over-year revenues, a $465 million increase in operating expenses and a $470 million increase in the provision for taxes, which offset a $2.0 billion improvement in the cost of credit from the prior year period. The credit reserve release reflects a lower level of inherent losses remaining in the portfolio. Fourth quarter 2011 expenses included $557 million of legal and related costs and the previously announced repositioning charge of $428 million. Additionally, as previously announced, the $470 million increase in the provision for taxes includes a tax charge of $300 million due to a write-down in the value of Japanese deferred tax assets reflecting legislation in Japan that decreased the corporate income tax rate.
Revenues fell 6.4% year/year to $17.2 billion versus the $18.55 billion consensus. fourth quarter Net Credit Losses declined 40% y/y to $4.1 bln; Full Year 2011 Net Income of $11.3 bln up 6% y/y; Full Year 2011 revenues of $78.4 bln compared to $86.6 bln in 2010; Citicorp Loans of $465.4 Billion grew 14% y/y; Full Year 2011 Net Credit Losses of $20.0 Billion Compared to $30.9 Billion in 2010; Loan Loss Reserve Release of $1.5 Billion in fourth quarter, down 35% from the Prior Year; Tier 1 Common of $115.1 Billion, Tier 1 Common Ratio Increased to 11.8% Year-over-Year, Book Value Per Share up 8% to $60.78, Tangible Book Value Per Share up 12% to $49.81.
Citicorp revenues of $14.0 billion in the fourth quarter 2011 included $(74) million of CVA/DVA compared to $(1.0) billion in the prior year period. Excluding CVA/DVA, Citicorp revenues of $14.1 billion were 8% below the prior year. The decline was largely due to lower revenues in Securities and Banking, which, excluding CVA/DVA, were 29% below the prior year period and more than offset a 1% growth in RCB revenues and 2% growth in Transaction Services revenues from the prior year period.
Citi Holdings revenues of $2.8 billion in the fourth quarter 2011 were 30% below the prior year period. The decline in Citi Holdings revenues was principally due to the continuing reduction in assets, which decreased $90 billion, or 25%, from the end of 2010. Citi Holdings assets of $269 billion at the end of the fourth quarter 2011 included approximately $45 billion related to Citi's retail partner cards business which, as previously announced, Citi intends to transfer into Citicorp during the first quarter 2012.
Citigroup's net income declined 11% from the fourth quarter 2010 to $1.2 billion in the fourth quarter 2011, reflecting a $1.2 billion decline in year-over-year revenues, a $465 million increase in operating expenses and a $470 million increase in the provision for taxes, which offset a $2.0 billion improvement in the cost of credit from the prior year period. The credit reserve release reflects a lower level of inherent losses remaining in the portfolio. Fourth quarter 2011 expenses included $557 million of legal and related costs and the previously announced repositioning charge of $428 million. Additionally, as previously announced, the $470 million increase in the provision for taxes includes a tax charge of $300 million due to a write-down in the value of Japanese deferred tax assets reflecting legislation in Japan that decreased the corporate income tax rate.
