Citi’s securities services revenues of $692 million have increased 10 per cent on a reported basis and 9 per cent in constant dollars for Q3 2021.
According to the bank, this was driven by growth in assets under custody and settlement volumes, partially offset by lower deposit spreads.
However, on the whole, markets and securities services revenues of $5 billion decreased 4 per cent. Fixed income markets revenues of $3.2 billion decreased 16 per cent.
Citi says this reflects the continued normalisation in market activity across rates and spread products. Equity markets revenues of $1.2 billion increased 40 per cent, driven by derivatives, prime finance and cash equities, reflecting solid client activity and favorable market conditions.
Last year, Citi reported markets and securities services revenues for Q3 2020 as $5.2 billion, a 16 percent increase compared to Q3 2019, which stood at $4.5 billion.
Meanwhile, revenues declined 1 per cent from the prior-year period, including a pre-tax loss of approximately $680 million related to the sale of the Australia consumer business in Global Consumer Banking (GCB).
Net income of $4.6 billion increased 48 per cent from the prior-year period driven by a lower cost of credit, partially offset by the lower revenues and higher expenses.
Further highlights from the Q3 2021 report found that earnings per share of $2.15 increased 58 per cent from the prior-year period, reflecting the growth in net income, as well as a 3 per cent decline in shares outstanding.
Jane Fraser, Citi CEO, comments: “The recovery from the pandemic continues to drive corporate and consumer confidence and is creating very active client engagement as you can see through our strong results in Investment Banking and Equity Markets, both up approximately 40 per cent year-over-year, in addition to double-digit fee growth in Treasury and Trade Solutions as we help our clients reposition their supply chains.”
“Overall, our revenues were 3 per cent higher than last year excluding the impact of the sale of our consumer business in Australia. We are moving forward with urgency on our top priorities in order to responsibly narrow the returns gap with our peers: the Transformation, refreshing our strategy, and building a culture of excellence,” adds Fraser.
Fraser concludes: “Overall, I am quite pleased with $4.6 billion in net income given the environment we are operating in. While we have much work ahead, we are getting results from the investments we have been making and seeing both the strength and durability of our franchise.”
