Citigroup 1Q14 Earnings Call Notes

posted in: Notes | 0

A digest of some of the top insights that I’ve gathered from this week’s earnings calls.  Full notes can be found here.

We’re engaged with the Fed

” we’re engaged with the Fed, so we can fully understand their concern. We’re committed to bringing our capital planning process in line with the highest standards befitting an institution of our global reach.”

Not an issue with our business model or capital

“we don’t believe this is an issue with our business model or our strategy. It also isn’t an issue with our levels of capital or capability to generate capital”

An issue with the CCAR process

“Whatever the gaps are between the Fed’s expectations and our CCAR process, we’ll close it. We’ll devote whatever resources and make whatever changes are necessary to accomplish this critical goal. ”

Also dealing with the fraud in Mexico

“Regarding the fraud in Mexico, we’re progressing along several fronts”

Korea has stabilized

“Korea remained a headwind. However, while we continue repositioning this franchise, we believe revenues in this market have largely stabilized and credit has remained favorable. ”

Some of the worries about emerging markets seem to have subsided

“We’ve kind of transitioned out a bit of the year-end malaise, which was largely focused around Fed policy or Fed stance. And I think we’ve seen volumes pick up, and I think confidence result as part of that. But at the same time, I don’t think you can ignore what’s going on in the Ukraine or in Russia. Those things clearly continue to have an overhang on the market. So I think the overall sentiment is better, but I think there’s still some things out there which I think cause people to pause.”

more color on the CCAR deficiencies

“we’re probably going to be most focused on around some process driven things, some model driven things, some people driven things that we’re going to be focused on. And again, I think from our perspective, from the conversations or what I’ve heard, not business model, not strategy, and again, I think things that will take a fair bit of hard work, but things that we feel very strongly that we can get done.”

The Fed is delineating qualitative and quantitative side

” one of the takeaways from the Fed process this year is there continues to be more and more delineation between the qualitative and the quantitative side. But I think we’ve got several months of work to do here. ”

Corbat takes responsibility for CCAR failure

“I am. Obviously, when you think of something that is as important as this for the institution and our shareholders, it’s at the top of the house. So I’m accountable, and if you read our filings, it is in my scorecard, and it’s something for which I’m sure the board will hold me accountable in 2014 when they reflect upon the year. And I’m accountable for it, and I’m accountable for fixing it.”