(Reuters) – Citigroup reported a drop in fourth-quarter profit on Friday as the bank boosted reserves in response to a worsening economy and investment banking revenue fell due to a sharp drop in trading activity.
Citi shares fell nearly 3% in premarket trading after fears of a potential recession prompted Citigroup to add $58 million to reserves in the fourth quarter.
By contrast, its reserves were released when 2021 pandemic-related loan losses failed to wipe out 1.37 billion
Citigroup’s investment banking revenue plunged 58% as M&A activity slowed sharply last year as the firm struggled with rising interest rates, Ukraine Avoiding trades in war
However, Citi’s markets business was boosted as traders began repositioning portfolios in the face of heightened volatility. Citi’s revenue jumped 6% to 18 billion.
For the three months ended December, net income was $2.5 billion, or $1. per share16, compared to $3.2 billion, or $1.58 per share, in the same period last year.