Ahead of next week’s second-quarter figures, the markets are expecting Citigroup to announce its earnings per share (EPS) will be down by 14% year-on-year. Considering the general consensus that the company’s pretax profit is expected to be $4.879 billion, some 22% down from the equivalent 2013 figures, the shares have performed relatively well.
No bank has been unaffected by the changes in regulations governing cash debt ratios, and almost all have found themselves being fiscally punished for historical transgressions. Citigroup is not the exception to that rule, as it is currently facing a $7 billion fine for the mis-selling of mortgage products prior to the financial crisis.
In a similar template to many of its global competitors, Citigroup has also embarked on aggressive asset stripping over the last few years, selling off holdings in the Housing Development Finance Corporation, Akbank, EMI music and Pershing Square Capital Management.
The Citigroup shares price found itself stuck in a range between $46 and $50 for almost all of the last six months, and with the results and a possible sizeable fine looming there is every chance we will see the lower end of this range tested again.