Tomahawk, WI 8/08/2013 (Basicsmedia) – Citigroup Inc (NYSE:C), is known all over the world for its diversified financial services. It offers a wide range of financial products and services to its customers across the globe. The company has been doing this since 1812 when it was founded and set its base in New York, New York. Most of its services are offered through two major components, namely Citi Holdings and Citicorp. However, there are a few important facts about this company which every investor, both prospective and current, needs to know immediately.

Does C Enjoy Strong Leadership?

Michael Corbat is the current CEO of Citigroup Inc, and the recently announced results, were the first under his watch. When he took over, he listed his objectives as winding down Citi Holdings, reduction of legal uncertainties, and continued building and improvement of the company’s global branding. This group announced a first quarter net income of approximately $3.8 billion, which though was not impressive by Citigroup’s standards, is a clear indication of the path of growth which it has embarked upon. The rest of the year is expected to follow the same pattern.

The question then becomes, should the fist quarter impressive results be cause for excitement?  It is never a good idea for any investor to get too excited by the financial results of only one quarter. A single quarter doesn’t provide a better outlook at the direction which a company is taking, and the same applies with C. Therefore, one needs to take a look at several quarters of 2013 and the other years to get a conclusive picture as to what the future holds. For C, one has to consider that it was heavily affected by the financial crisis of 2008, but it seems to be recovering.


Image shows Citigroup’s ranking in the world in comparison to its competitors.

Image is courtesy of

What makes C’s Earnings Attractive?

The market in general appears to have been impressed by the earnings which C recently reported. The reasons for this development are because the market loves the loan improvements which were reported in C’s results. The bad loans appear to be gradually disappearing from the company’s financial results. Overall, it also looks like the credit quality is on a mend and this is good news for a market which was heavily affected by the financial crisis of 2008, which never spared any corner of the world. Some companies are yet to report positive growth ever since.

The second reason why the market has responded positively to Citigroup’s earnings is because of the growth which has been noted on securities and banking. As a whole, it appears clear to anyone who is interested, that the bank’s equities and fixed income have started responding well to the measures which the institution put in place to remedy a very bad situation. Citigroup has also been classified as one of the few institutions which enjoy strong capital ratios. Its balance sheet is much stronger compared to what the situation appeared to be a few years ago.

Should Investors Sell or Buy?

However, the bank’s operating expenses haven’t been brought down thus far. The bank could also get harmed by releasing too much money as loans. Revenues from transaction services have dropped somewhat and this is not good for a bank of C’s caliber. I believe that the bank is enjoying the fruits of strong and able leadership, and is witnessing a period where it will be back to profitability. This seems to be only a matter of time. If you want to, I would advice you to buy C shares and if you already own them, hold on to them, or buy more. Better days lie ahead.

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