Citigroup CEO Optimistic About U.S. Economy Amid Tariff Challenges
Citigroup Inc.’s CEO, Jane Fraser, expressed unwavering confidence in the U.S. economy’s resilience, stating that it will continue to flourish despite ongoing trade policy uncertainties. Her positive outlook came as Citigroup reported a robust 21% increase in first-quarter profits, equating to $4.1 billion, or $1.96 per share, compared to $3.4 billion, or $1.58 per diluted share, during the same period last year. This strong performance, which exceeded Wall Street analysts’ expectations of $1.85 per share, was bolstered by a notable 15% drop in operating expenses to $2.7 billion and a 3% rise in revenue to $21.6 billion, surpassing the anticipated $21.3 billion.
Fraser’s Insight on the U.S. Economy
In her prepared statement, Fraser reflected on the current state of international trade, emphasizing, “When all is said and done, and longstanding trade imbalances and other structural shifts are behind us, the U.S. will still be the world’s leading economy, and the dollar will remain the reserve currency.” This sentiment is particularly significant as it comes amidst the ongoing turmoil in global trade policies, which are heavily influenced by the administration of President Donald Trump and the U.S.’s trading partners.
Stock Market Response
Following the announcement of these strong earnings, Citigroup’s stock (C) saw a slight rise of 1.8% on Tuesday. Despite facing a decline of 10.2% in stock value in 2025, the latest results reveal an opportunity for investors, especially since CFRA analyst Kenneth Leon noted that the stock is trading significantly below its tangible book value of $91.52 per share. At last check, Citigroup’s shares were trading below $65, prompting Leon to reaffirm his buy rating due to the bank’s robust capital position.
Business Performance Breakdown
Fraser pointed to improvements across Citigroup’s five core businesses, showcasing the bank’s readiness to tackle a variety of macroeconomic uncertainties. The bank has increased its allowance for credit losses substantially to $210 million from $21 million year-over-year. The total allowance for credit losses now stands at $22.8 billion, with net credit losses on the rise, increasing to $2.5 billion from $2.3 billion in the previous year. These changes reflect the bank’s proactive measures in response to a deteriorating macroeconomic outlook.
Growth in Trading Revenues
Like its peers on Wall Street, Citigroup has also reported a surge in market revenues, with a 12% increase to $6 billion, driven by a rise in both fixed-income and equity markets revenue. Additionally, the bank achieved revenue records through its U.S. personal banking and wealth management units, indicating strong growth potential even amid economic turbulence.
Innovations and Partnerships
During the quarter, Citigroup reinvested in its business, authorizing $2.8 billion in share buybacks and dividends, underlining its commitment to returning value to shareholders. The U.S. personal banking unit has taken innovative steps by launching a generative-AI pilot aimed at optimizing client interactions, while a partnership with Palantir Technologies seeks to enhance data management and client experiences.
Conclusion
Despite a rocky start to 2025, with Citigroup’s stock trailing behind the S&P 500, Fraser’s optimism portrays a belief in the underlying strength of the U.S. economy. As Citigroup etches out strategies to navigate through turbulent trade policies, it underscores a broader confidence in the sustainability of the dollar and the American economic framework.
As challenges persist and market dynamics evolve, investors will be closely monitoring Citigroup’s performance and its broader implications for the global economy.