Citigroup reported third-quarter results on Tuesday, October 13, before the market opened. Net income: $5.2 billion, $2.85 per share - against $3.8 billion and $1.86 in the same quarter a year earlier. Revenue rose 8% to $23.8 billion, and according to the bank's release this is its highest third-quarter revenue in a decade.
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What Was Reported
| Q3 2026 | Q3 2025 | Change | |
|---|---|---|---|
| Revenue | 23,845 | 22,090 | +8% |
| Net interest income | 16,982 | 14,940 | +14% |
| Noninterest revenue | 6,863 | 7,150 | -4% |
| Expenses | 13,952 | 14,290 | -2% |
| Provision for credit losses | 2,586 | 2,450 | +6% |
| Net income | 5,245 | 3,752 | +40% |
| Diluted earnings per share (dollars) | 2.85 | 1.86 | +53% |
| Return on tangible common equity (ROTCE) | 11.5% | 8.0% | +3.5 pts |
| Efficiency ratio | 58.5% | 64.7% | -6.2 pts |
| Common equity tier 1 ratio (CET1) | 12.8% | 13.3% | -0.5 pts |
In millions of dollars, except per-share figures and ratios. Source: the bank's results release and Financial Data Supplement, October 13, 2026.
Where the Money Was Made
Net interest income rose 14% to $16,982 million, while noninterest revenue fell 4% to $6,863 million. In other words, all of the revenue growth, and more, came from interest.
Markets brought in $6,113 million, up 6%. Fixed income trading rose 4% to $4,386 million: rates and currencies were unchanged at $2,965 million, and spread products rose 12.6% to $1,421 million. Equities trading rose 14% to $1,727 million, against $1,520 million a year earlier. Against the second quarter, markets revenue fell 13% and equities trading fell 25%.
Investment banking fees rose 9% to $1,350 million. Equity underwriting jumped 76.8% to $343 million, debt underwriting fell 2.9% to $601 million, and advisory fell 4.5% to $406 million.
The Wealth segment nearly doubled its profit: $585 million, against $303 million a year earlier, up 93%. Segment revenue rose 15% to $3,269 million, and its return on tangible capital was 14.3%, against 7.8%. Client investment assets reached $759 billion, up 15%, and net new investment assets came to $38 billion.
Among the other segments: Services brought in $6,614 million, up 15.4%; Banking, including loan hedges, $1,741 million, up 5.7%; US consumer cards $4,664 million, up 0.2%; and All Other, on a managed basis, $1,432 million, down 2.7%.
What Was in the Year-Ago Base
The jump of 40% in net income and 53% in earnings per share also rests on the base. In the third quarter of 2025 the bank booked in expenses a goodwill impairment of $726 million on Banamex in Mexico - $714 million after tax, 38 cents per share. In the current quarter the bank notes no notable item.
Excluding the impairment from the year-ago base, net income rose 17% (from a base of $4,466 million) and earnings per share 27% (from a base of $2.24). The return on tangible common equity was 9.7% on the adjusted base, so the rise to 11.5% is 1.8 percentage points rather than 3.5. Expenses rose 2.9% against an adjusted base of $13,564 million, and the efficiency ratio fell from an adjusted 61.4%, not from 64.7%, to 58.5%.
Operating leverage is positive even after the adjustment: revenue rose 8% and expenses, without last year's impairment, rose 2.9%. The tax rate fell to 25.8% from 29.1% a year earlier, by calculation from the figures.
Expenses in the quarter included, according to the bank, higher severance and a contribution to the Citi Foundation. According to the transcript of the analyst call, severance in the quarter came to about $200 million, and more than $1 billion year to date, and the bank pulled investments forward into the third quarter. Other items the bank notes: a $29 million reserve release in Services, a $9 million gain on loan hedges against a $44 million loss a year earlier, and a benefit from the devaluation in Argentina in the Treasury and Trade Solutions business.
Credit and Capital
The provision for credit losses rose 6% to $2,586 million, but net credit losses barely moved: $2,217 million, up 0.1%. The net credit loss ratio fell to 1.09%, from 1.21% a year ago and 1.23% last quarter. According to the bank's release, the net reserve build was $369 million, against $236 million a year earlier. The allowance for credit losses on loans stands at $20.1 billion, 2.5% of funded loans, and the net credit loss rate in US cards was 3.66%.
The common equity tier 1 ratio (CET1) stands at 12.8% (preliminary), the same as last quarter and below 13.3% a year ago. The bank returned $4.1 billion to shareholders in dividends and buybacks, 85% of income allocated to common shareholders. According to the call transcript, buybacks in the quarter were $3 billion, and $13.3 billion year to date. Book value per share is $115.61, and tangible book value per share is $101.59.
What Was Said About the Year
The results release contains no guidance. The bank's chair and chief executive, Jane Fraser, said in the release that the bank expects to exceed this year's return target even as it pulls investments forward. The remaining figures here come from the transcript of the analyst call published by The Motley Fool, not from a document the bank published.
The bank raised its estimate for net interest income excluding markets for the full year: growth between the middle of 6% and its upper end, against 5% to 6% in the previous estimate, according to CNBC. Also said: return on tangible capital above 11% for the year, an efficiency ratio below 60%, and a net credit loss rate in US cards of about 4%, at the low end of the previous range. Fraser described a near-term return target of 11% to 13%, on the way to 14% to 15%.
For the fourth quarter the bank expects a seasonal decline of about 20% in markets revenue, possibly a bit more - that is, about $4.9 billion or less, by calculation, against $6.1 billion in the third quarter. And one more item from the call: in early 2027 the bank is expected to stop consolidating Banamex in its statements (deconsolidation), with a loss of about $9 billion from accumulated currency translation adjustments (CTA), to be recorded through the income statement.
Against Expectations, and the Stock
According to an LSEG survey published by CNBC before the report, analysts expected earnings of $2.66 per share and revenue of $23.72 billion. The reported earnings beat expectations by 19 cents, 7.1%, and revenue by 0.5%. According to StreetAccount, cited in the same report, fixed income trading ($4,386 million against $4.31 billion) and investment banking fees ($1,350 million against $1.29 billion) were above expectations, and equities trading ($1,727 million against $1.76 billion) was below them.
The stock closed on report day at $124.53, down 5.6%. From the start of the year to report day the stock rose about 6.7%.
הזווית שלי
דעה אישית של אילן אברמוב - לא ייעוץ ולא המלצה
What interests me in this report is the gap between the numbers and the reaction. A bank that beat expectations on earnings and revenue, cut expenses and raised its estimate for interest income closed down 5.6%. I do not know the reason, and the report itself does not answer it.
It can be read in two ways. One, a bank that lowers its efficiency ratio from 64.7% to 58.5%, nearly doubles its wealth management profit and holds credit losses in place is on its way to its return target. Two, the year-ago base lowers the comparison - excluding the impairment, earnings per share rose 27% and not 53% - more than 70% of revenue comes from net interest income while noninterest revenue fell, and markets are expected to decline next quarter. Both readings fit the same numbers.
What I will follow is the composition of revenue, not the headline: whether noninterest revenue returns to growth, or growth rests on interest alone.
(To be clear: this is my personal opinion only. Nothing here is a recommendation to take any action, and there is no forecast here of the price of any security.)
Ilan Abramov, the author, or anyone on his behalf may hold some of the securities or funds mentioned in this article.
