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Citi Third Quarter 2018 Fixed Income Investor Review

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Citi Third Quarter 2018 Fixed Income Investor Review Citi | Fixed Income Investor Relations Third Quarter 2018 Fixed Income Investor Review October 25, 2018 John Gerspach Chief Financial Officer Michael Verdeschi Treasurer Agenda • Net income of $13.7B YTD’18 Results • Efficiency ratio of 57.3% • 11.2% RoTCE(1) • Growth in loans and deposits Balance Sheet • Credit quality remained strong • Issuance program summary Issuance • Long-term debt issuance and redemptions • 120% Liquidity Coverage Ratio (LCR)(2) Liquidity & • 11.8% Common Equity Tier 1 (CET1) Capital Ratio(3) Capital • 6.5% Supplementary Leverage Ratio (SLR)(3) Note: Efficiency Ratio: Total expenses divided by total revenue. RoTCE: Return on Tangible Common Equity. (1) Preliminary. RoTCE is a non-GAAP financial measure. For additional information on this measure, please refer to Slides 30 and 31. 2 (2) Preliminary. (3) Preliminary. For additional information on these measures, please refer to Slides 29 and 30, respectively. Summary Financial Results ($MM, except EPS) 3Q'18 2Q'18 %r 3Q'17 %r Revenues $18,389 $18,469 (0)% $18,419 (0)% • Revenues (1) Operating Expenses 10,311 10,712 (4)% 10,417 (1)% – Excluding gains and the Efficiency Ratio 56.1% 58.0% 56.6% impact of FX translation, revenues were up 4% driven Operating Margin 8,078 7,757 4% 8,002 1% by strong performance in ICG Net Credit Losses 1,756 1,704 3% 1,777 (1)% (2) Net LLR Build / (Release) 192 87 NM 194 (1)% • Expenses PB&C 26 21 24% 28 (7)% – Positive operating leverage Credit Costs 1,974 1,812 9% 1,999 (1)% and efficiency ratio of 56.1% EBT 6,104 5,945 3% 6,003 2% • Credit Costs Income Taxes 1,471 1,444 2% 1,866 (21)% – Down 1% YoY reflecting lower Effective Tax Rate 24% 24% 31% reserve builds in North Net Income $4,622 $4,490 3% $4,133 12% America Consumer largely Return on Assets 0.95% 0.94% 0.87% offset by volume growth and Return on Tangible Common Equity (3) 11.3% 10.8% 8.4% normalization of credit costs in ICG EPS $1.73 $1.63 6% $1.42 22% Average Diluted Shares 2,481 2,532 (2)% 2,684 (8)% • EBT Average Assets ($B) $1,923 $1,917 0% $1,892 2% – Excluding gains(1) up 8% YoY EOP Assets (Constant $B) 1,925 1,908 1% 1,867 3% EOP Loans (Constant $B) 675 670 1% 647 4% EOP Deposits (Constant $B) 1,005 994 1% 953 5% Note: Totals may not sum due to rounding. GCB: Global Consumer Banking. ICG: Institutional Clients Group. NM: Not meaningful. Constant dollar excludes the impact of foreign exchange translation into U.S. dollars for reporting purposes and is a non-GAAP financial measure. For a reconciliation of constant dollars to reported results, please refer to Slide 31. (1) In 3Q’17, Citi recorded a pre-tax gain of approximately $580 million related to the sale of a fixed income analytics business in ICG. In 3Q’18, Citi recorded a pre-tax gain of approximately $250 million related to the sale of an asset management business in Latin America GCB. Adjusted results excluding the gains on sale, as used throughout this presentation are non-GAAP financial measures. 3 (2) Includes provision for unfunded lending commitments. (3) For additional information on this measure, please refer to Slides 30 and 31. Average Balance Sheet Trends (Constant $B, except as noted) Assets Liabilities & Equity Avg Assets $1,892 $1,910 $1,904 $1,917 $1,923 (as reported) YoY% r YoY% r $1,923 3% $1,923 $1,874 $1,896 $1,876 $1,903 $1,874 $1,896 $1,876 $1,903 210 Cash 198 201 188 195 2% Investments 348 350 347 345 347 Deposits 956 965 964 977 986 3% Trading-Related 512 520 534 533 6% Assets(1) 505 Trading-Related 300 303 315 320 7% Liabilities(4) 303 Loans, net(2) 627 638 645 652 658 5% LTD 230 236 232 236 241 5% All Other Liabilities(5) 158 168 175 175 177 All Other Assets(3) 195 195 176 177 175 Equity 230 224 202 201 199 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 Note: Totals may not sum due to rounding. LTD: Long-term debt. For a reconciliation of constant dollars to reported results, please refer to Slide 31. (1) Trading-related assets include federal funds sold and securities borrowed or purchased under agreements to resell and trading account assets. (2) Represents loans net of allowance for loan losses. (3) All other assets include brokerage receivables, goodwill, intangible assets, deferred tax assets, mortgage serving rights and all other assets. 4 (4) Trading-related liabilities include federal funds purchased and securities loaned or sold under agreements to repurchase and trading account liabilities. (5) All other liabilities include short-term borrowings, brokerage payables and other liabilities. Average Loan Trends (Constant $B) YoY% r $658 $664 $670 Citigroup $640 $650 Citigroup 5% $297 $302 $302 $301 $307 85 86 86 86 88 Asia(1) 4% 25 26 26 26 26 Latin America 4% GCB GCB 3% North 3% 187 190 190 189 193 America $344 $346 $317 $325 $333 43 46 Markets 15% 40 40 41 90 93 Private Bank 13% 82 86 88 ICG ICG 74 76 76 77 77 TTS 4% 9% Corporate 8% 121 123 128 134 131 Lending $26 $24 $22 $20 $17 Corp / Other 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 Note: Totals may not sum due to rounding. Amounts represent average loans, net of unearned income. TTS: Treasury and Trade Solutions. For a reconciliation of 5 constant dollars to reported results, please refer to Slide 31. (1) Asia consumer includes the results of operations of consumer banking activities in certain EMEA countries for all periods presented. GCB & ICG Regional Credit Trends GCB Loans – Net Credit Losses (NCL) (%) North America Latin America Asia(1) Total GCB 6% 5% 3Q’18 4.63% Total LLR = $9.6B 4% NCL Coverage = 3% 2.56% ~17 months Delinquency 2% 2.22% Coverage(2) = 4.0x 1% 0.75% 0% 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 ICG Non-Accrual Loans(3) as % of Total ICG Loans North America EMEA Latin America Asia Total ICG 1.5% 3Q’18 1.0% Total LLR = $2.3B 0.78% LLR / Non-Accrual 0.43% Loans = 1.6x 0.5% 0.43% NCL rate = 0.0% 0.38% 0.36% ~82% investment 0.0% grade(4) 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 Total ICG Non-Accrual Loans ($MM) $2,365 $2,376 $2,265 $2,049 $2,005 $1,893 $1,621 $1,575 $1,498 Note: NCL rates shown are percentages of average consumer or corporate loans. Non-accrual loans shown as percentages of end-of-period corporate loans. LLR: Loan Loss Reserves. (1) Asia consumer includes the results of operations of consumer banking activities in certain EMEA countries for all periods presented. (2) Loan loss reserves divided by 90+ day delinquencies. (3) Non-accrual loans as defined in Citigroup’s 2017 Form 10-K. (4) Facility rating. Preliminary. As part of its risk management process, Citi assigns internal numeric risk ratings to its corporate loan facilities based on quantitative and 6 qualitative assessments of the obligor and facility. Excludes Private Bank loans managed on a delinquency basis and loans carried at fair value. Average Deposit Trends (Constant $B) YoY% r $977 $986 $956 $965 $964 Citigroup Citigroup 3% $305 $305 $305 $304 $307 94 94 96 96 98 Asia(1) 4% GCB 27 28 29 29 29 Latin America 8% GCB North 1% (2)% 184 183 181 180 180 America $668 $628 $648 $639 $654 Markets / 87 5% 83 81 81 86 Sec. Svcs. Banking 125 2% 122 126 127 125 (ex-TTS)(2) ICG ICG Treasury 6% & Trade 8% 423 440 431 443 457 Solutions (TTS) Corp / Other $23 $12 $20 $18 $11 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 Note: Totals may not sum due to rounding. For a reconciliation of constant dollars to reported results, please refer to Slide 31. 7 (1) Asia consumer includes the results of operations of consumer banking activities in certain EMEA countries for all periods presented. (2) Banking ex-TTS includes Private Bank and Issuer Services. Parent Benchmark Debt Issuance Program Summary ($B) By Seniority By Term Senior Subordinated 3 Years 4-8 Years 10-13 Years 20 Years 30 Years $30.0 $30.0 1.0 4.0 $22.9 $22.9 11.0 1.3 1.7 $15.4 8.1 $15.4 0.6 2.7 26.0 1.0 21.6 16.0 3.3 14.8 10.6 8.5 2.0 2.5 2016 2017 YTD 2018 2016 2017 YTD 2018 By Currency By Call Structure USD EUR Other(1) Bullet Callable $30.0 $30.0 1.7 2.0 4.1 $22.9 $22.9 0.3 $15.4 $15.4 13.2 4.5 28.1 24.2 22.7 9.9 11.0 9.8 5.6 2016 2017 YTD 2018 2016 2017 YTD 2018 Note: Totals may not sum due to rounding. 8 (1) Other currencies include: AUD, CAD, JPY and CHF. Bank Note & Securitization Issuance Summary ($B) By Structure By Term By Rate Bank Notes(1) Securitizations(2) ≤ 3 Years > 3 Years Floating Rate Fixed Rate Bank Notes(1) Bank Notes(1) $12.6 $12.6 $23.6 $8.5 5.8 $8.5 12.2 3.5 6.9 12.6 5.1 $14.8 0.4 2017 YTD 2018 2017 YTD 2018 Securitizations(2) Securitizations(2) 8.5 $11.1 $11.1 4.2 11.1 8.1 $6.3 $6.3 1.8 2.0 6.3 6.9 4.5 4.3 3.0 2017 YTD 2018 (3) 2017 YTD 2018(3) 2017 YTD 2018(3) Note: Totals may not sum due to rounding.
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