Jan 15 (Reuters) - Citigroup reported a fourth-quarter profit driven by trading and dealmaking strength, and revealed a $20 billion stock buyback program while adjusting a closely watched return goal.
The bank's shares rose nearly 4% in premarket trading on Wednesday after announcing the authorization of a new repurchase initiative.
"Citi CEO Jane Fraser stated, '2024 was a pivotal year showing our strategy is producing the intended results and reinforcing our business performance.'"
Fraser added, "Our 2026 ROTCE is now expected to be between 10% and 11% to further invest in our businesses and transformation. This figure is a milestone, not the final destination."
Citigroup posted a net income of $2.9 billion, or $1.34 per share, for the fourth quarter, a significant improvement from the $1.8 billion loss, or $1.16 per share, reported a year earlier.
Total revenue increased to $19.6 billion from $17.4 billion in the previous year.
Citigroup's trading desks saw substantial gains from a successful year in U.S. equities, particularly as the S&P 500 reached record highs in the last quarter, pushing markets revenue at Citi up by 36% to $4.6 billion.
In 2024, Citi's global investment banking revenue surged by 26% to $86.8 billion, ranking fifth in fees earned across banks during the same period.
With a 37% stock surge in 2024, Citigroup outperformed the broader banking index and equity markets, reflecting investor confidence in CEO Jane Fraser's initiatives to revamp the bank.
Fraser's strategies implemented since late 2023 to boost profits, enhance operations, and address long-standing issues in risk management and data governance showed progress and were largely carried out last year.
Revenue in Citi's wealth management unit, a focal point in Fraser's growth plan, rose by 20% to $2 billion.
Investors are now evaluating whether Fraser and her team can achieve growth targets and tackle regulatory challenges imposed on the bank in recent years.