Citigroup Inc (NYSE:C) Q2 2019 Earnings Conference Call - Final Transcript

Jul 15, 2019 • 10:00 am ET


Citigroup Inc (NYSE:C) Q2 2019 Earnings Conference Call - Final Transcript


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Hello and welcome to Citi's Second Quarter 2019 Earnings Review. Today, we are joined by Citi's Chief Executive Officer, Mike Corbat; Chief Financial Officer, Mark Mason. Today's call will be hosted by Elizabeth Lynn, Interim Head of Citi Investor Relations.

We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question-and-answer session. Also as a reminder, this conference call is being recorded today. If you have any objections, please disconnect at this time.

Ms. Lynn, you may begin.

Elizabeth Lynn

Thank you, operator. Good morning and thank you all for joining us. On our call today, our CEO Mike Corbat will speak first; then Mark Mason, our CFO, will take you through the earnings presentation which is available for download on our website; afterwards, we will be happy to take questions.

Before we get started, I'd like to remind you that today's presentation may contain forward-looking statements which are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results and capital and other financial conditions may differ materially from these statements due to a variety of factors including the precautionary statements referenced in our discussion today and those included in our SEC filings, including without limitation, the risk factors section of our 2018 Form 10-K.

With that said, let me turn it over to Mike.

Michael Corbat

Thank you, Liz, and good morning everyone. This morning we've reported earnings of $4.8 billion for the second quarter of 2019. Our earnings per share of $1.95 was 20% higher than one year ago. We increased our return on assets year-over-year to 97 basis points and generated a return on tangible common equity of 11.9%, over a 100 basis points better than last year.

We delivered positive operating leverage for the 11th straight quarter and improved our efficiency, while again, growing loans and deposits. These results stem from strong execution of our strategy across all lines of business and show the benefits of our global franchise and product mix.

Global Consumer Banking saw 4% revenue growth overall in constant dollars with the contribution from every region. In North America, that was led by continued strong performance in branded cards, and again, we saw encouraging momentum in deposit growth, which accelerated from the first quarter. And internationally, net income was up 25%.

In Mexico, performance was driven by good underlying revenue growth, expense management and credit discipline. In Asia, higher deposit revenues and a recovery in investment revenues drove growth in the region.

In our Institutional Clients Group, we delivered continued growth overall and our steadier transaction and accrual type business showing the strength of our global client network, while we saw a pressure in our market-sensitive businesses reflecting the broader industry, even in products like investment banking, where we continue to gain share.

During the quarter, we received a non-objection from the Federal Reserve for our 2019 CCAR submission. That means we will meet the goals