[ad_1]
Citigroup (C) is in the midst of a complex restructuring. The company said Wednesday that its fourth-quarter earnings report on Friday will also be complicated.
The New York-based banking giant said in a regulatory filing that it will take more than $3 billion in one-time provisions and expenses as part of its fourth-quarter results.
These include everything from $1.3 billion in reserves for currency exposure in Argentina and Russia, to severance pay and other aspects related to the bank’s broader restructuring led by CEO Jane Fraser. Everything is included, up to the $780 million cost.
It also plans to report a $1.7 billion charge to pay special assessments to the Federal Deposit Insurance Corporation.
Other large banks will also be weighed down by similar FDIC ratings used to cover $18 billion in losses to the FDIC’s insurance fund from the failures of Silicon Valley Bank and Signature Bank last March.
Citigroup previously estimated the amount to be $1.65 billion.
Wednesday’s disclosure did not include the full fourth-quarter results, so it’s not yet clear how much of a hit these fees and expenses will have on the bank’s bottom line. Following the announcement, the company’s stock price fell more than 1% in after-hours trading.
“The items disclosed today do not change our strategy,” Citigroup Chief Financial Officer Mark Mason said in a blog post.
He added: “Although we rarely provide quarterly financial information prior to the scheduled earnings release date, we thought this was a prudent step in our commitment to building credibility and transparency. ” he added.
Citigroup is scaling back its ambitions in an effort to revive its stock price and shed decades of bloat. Fraser is trying to make the company more efficient by focusing on serving large multinational corporations and cutting out unprofitables.
She is exiting the municipal bond business and exiting consumer banking operations around the world, with plans to exit 14 consumer franchises in Asia, Europe, the Middle East, Africa and Mexico.
He is also cutting jobs and reorganizing business units as part of an internal restructuring that Fraser calls the “most significant” change in the way Citigroup operates in nearly 20 years.
Wells Fargo analyst Mike Mayo, a longtime critic of the bank during difficult times, named Citi his top bank stock for 2024. Mayo expects the bank’s stock price to double over the next three years as it improves profitability.
“I hate some companies, but I love their stocks,” Mayo recently told Yahoo Finance. “I think the things I hate become less and less bad,” he added.
For the latest stock market news and in-depth analysis of price-moving events, click here.
Read the latest financial and business news from Yahoo Finance
[ad_2]
Source link
