Citigroup Inc (NYSE:C) Q4 2019 Earnings Conference Call - Final Transcript

Jan 14, 2020 • 11:30 am ET


Citigroup Inc (NYSE:C) Q4 2019 Earnings Conference Call - Final Transcript


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Hello and welcome to Citi's Fourth Quarter 2019 Earnings Review. Today, we are joined by Citi's Chief Executive Officer, Mike Corbat; the Chief Financial Officer; and Mark Mason, CFO. Today's call will be hosted by Elizabeth Lynn, Head of Investor -- Citi, Investor Relations. [Operator Instructions]

Ms. Lynn, you may begin.

Elizabeth Lynn

Thank you, operator. Good morning, and thank you all for joining us. On our call today are 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, 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. This morning we announced that we had a strong close to 2019. We reported earnings of $5 billion for the fourth quarter, bringing our net income to $19.4 billion for the year, the highest since 2006. Our earnings per share of $2.15 were over 30% higher than a year ago and the $8.04 for the full-year was over 20% above 2018.

We finished the year with a return on tangible common equity of 12.1%, just ahead of our 12% target for the year, this is 120 basis points higher than our 2018 return on tangible common equity of 10.9%.

In constant dollars, our 2019 underlying revenues increased by 4% in both Global Consumer Banking and our Institutional Clients Group, good revenue growth paired with disciplined expense management allowed us to deliver positive operating leverage even as we continue to make significant investments in the franchise. Pre-tax earnings were up 5%.

We also had loan and deposit growth for the year and for the 16th consecutive quarter. Our return on assets rose to 98 basis points for the year. Our strong finish to 2019 was a result of balanced performance of both -- across both products and geographies. Both North America and International Consumer Banking had 4% year-over-year revenue growth. In the US, Branded Cards revenues continued to grow at a healthy clip with a 10% increase for the quarter, bringing the full-year increase to 8%. We continued to attract digital deposits from both existing and new customers, bringing the total to $6 billion for the year.

Better sentiment helped increase our Wealth Management revenues in Asia and our Cards business contributed to growth in Mexico. Investor sentiment also positively impacted our Institutional business for the fourth quarter. Fixed income was up nearly 50% from a tough final quarter of 2018; equities didn't perform as well