Updated Aug 14 at 10:47am ET.
Follow Citigroup to never miss an important update.
Citigroup plans to acquire Kard Financial, a platform that helps banks and financial technology firms offer targeted rewards and shopping deals. The move is designed to help Citigroup's US consumer card business better compete by using data to show customers more relevant offers.
This fits into the bank's broader goal of making its consumer business more efficient and profitable. By improving its rewards technology, Citigroup aims to keep customers using its cards more often, which is a key part of maintaining its earnings as it exits other less profitable international markets.
The US government sold 30-year bonds at their highest interest rates since 2001. When these rates rise, it generally signals that investors expect inflation to stay high or that the government needs to offer more to attract buyers for its debt.
For a bank like Citigroup, higher long-term rates are a double-edged sword. While they can allow the bank to charge more for long-term loans, they also increase the cost of the money the bank borrows to fund its operations. If rates rise too fast, it can also lower the value of the bonds the bank already holds on its books.
Citigroup has hired Jean-Baptiste Charlet to run its French arm. He joins from Morgan Stanley, a rival investment bank, as Citigroup continues to reshuffle its leadership across different regions. While this is a routine executive hire, it shows the bank is still focused on recruiting experienced talent to lead its European operations. For long-term owners, this is a minor update that does not change the overall progress of the bank's global restructuring plan.
Source: Reuters
Citigroup hired Rohan Sen, a former managing director at Bank of America, to lead its technology services banking group. This move is part of a broader push to grow its investment banking franchise by bringing in experienced talent from competitors. For a bank in the middle of a turnaround, winning over senior leaders from top-tier rivals is a good sign. It suggests that the bank's plan to simplify its business and focus on high-margin corporate services is helping it attract the people it needs to win more deals.
Andrea Gacki, the current director of the Treasury's Financial Crimes Enforcement Network, will join Citigroup as its global head of sanctions. She previously led the office that manages U.S. economic and trade sanctions against foreign countries and groups.
This is a strategic hire for a bank that has struggled with regulatory oversight. Bringing in a top government official who understands exactly how regulators think about financial crimes and sanctions should help the bank resolve its long-standing legal and compliance issues more quickly.
Source: Reuters
Analysts have maintained a steady stream of updates following the company's strong second-quarter performance in late July. Most analysts are positive, with 16 of 27 rating the stock a buy and an average target price suggesting 8% upside.
The bank has a habit of clearing the bars set by analysts, beating profit estimates in seven of the last eight quarters. This suggests management is doing a good job of managing expectations.
| Expectation | |
|---|---|
| EPS | $2.68 |
| Revenue | $23.75B |
