This quarter, Citigroup Inc.'s fourth-quarter results will likely be overwhelmed by a giant one-time tax charge. Here's what to look for in Tuesday morning's release.
Earnings: Don't Expect Any
Citigroup said last month it expected to take a $20 billion charge to earnings in the fourth quarter because of the tax overhaul. That is such a big hit that analysts expect it to lose money both for the quarter and the full year of 2017.
Revenue: Steady as It Goes
Analysts polled by Thomson Reuters are expecting revenue of $17.22 billion, which would be up from about $17 billion a year ago.
The Tax Law Has Cometh
Citigroup isn't the only bank to have to take a hit for the quarter because of the tax law. JPMorgan Chase & Co. on Friday reported $2.4 billion in costs from the tax overhaul. But long term, the new law should be a windfall for banks, because it slashes the corporate tax rate to 21% from 35%. Investors will be interested in any guidance about what that means for Citi.
Trading With Less Tumult
Political surprises in late 2016 -- most notably, the election of Donald Trump -- stirred up volatility and made for trading booms. But now, in the relative calm, banks including Citigroup expect trading revenue to be down. JPMorgan's trading revenue fell 26%, though the bank said it would have been down 17% excluding the impact of the tax law and another one-time loss.
The Credit Card Bill Is Coming Due
Under CEO Michael Corbat, Citigroup has been spending heavily to spiff up its credit-card unit, including new rewards programs and marketing. Investors will want to know when that will start paying off.
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(END) Dow Jones Newswires
January 13, 2018 08:14 ET (13:14 GMT)