Citigroup profit jumps 45% in Q2 on trading, investment banking strength
Investing.com -- Citigroup reported a 45% jump in second-quarter profit on Tuesday, driven by strong trading performance and a sharp increase in investment banking fees.
Market volatility linked to the U.S.-Iran conflict has driven sharp movements in oil prices and other assets, prompting investors to adjust their portfolios and risk exposure. These conditions typically boost trading revenues at major banks.
Shares in the bank were down 1.23% in premarket trading on Tuesday.
Revenue reached its highest quarterly level in a decade as volatile markets fueled client trading activity, while a pickup in mergers and acquisitions and capital markets activity boosted advisory and underwriting income.
The bank served as an underwriter for SpaceX's $75 billion IPO during the quarter and advised on major M&A transactions, including the $44.8 billion combination of Unilever and McCormick's food businesses.
Investment banking revenues jumped 44% in the quarter to $1.55 billion. Total banking revenues rose 34% to $1.92 billion, though corporate lending revenue declined.
Citi's equities trading revenue increased 45% from a year earlier, while fixed-income markets revenue rose 7%. Rates and currency trading grew 1%, and other fixed income revenue, including commodities, climbed 25%.
The bank reported results alongside JPMorgan Chase & Co (NYSE: JPM), Goldman Sachs Group Inc (NYSE: GS), Wells Fargo & Company (NYSE: WFC), and Bank of America Corp (NYSE: BAC), all of which posted strong quarters with profit increases.