Citi sees quarterly investment banking slide, markets business rise

Men and women wander beneath a Citibank department emblem in the fiscal district of San Francisco, California July 17, 2009. REUTERS/Robert Galbraith/File Image

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June 15 (Reuters) – Citigroup (C.N) world head of markets Andy Morton explained to an investor meeting on Wednesday that he envisioned a decline of as much as 55% in the bank’s financial investment banking business enterprise this quarter and an enhance of above 25% in its markets business.

Citi was outperforming the S&P 500’s lender index (.SPXBK), up 1% on the day, with the company’s shares very last up 2.6% at $47.14 searching set for its 2nd straight working day of gains after a 4-day provide-off in which it dropped extra than 12%.

Morton, talking in the course of the webcast of a Morgan Stanley conference, said a slump in issuance and in mergers and acquisitions (M&A) owing to the macro economic and geopolitical scenario had been behind the investment banking decline.

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“Our perception is that the wallet is down 50%-55% in expenditure banking, and our assessment is that we’re going to arrive in right all over that individuals variety of concentrations,” Morton explained.

But he explained Citi’s marketplaces organization was a various story because of to industry volatility across all assets together with commodities and overseas trade, 1 of its critical segments.

Morton claimed his recent estimate was for a next-quarter 12 months-in excess of-12 months income improve “north of 25%” in marketplaces, though the executive said volatility also intended the situation could modify speedily.

“Just provided the volatility, you know, even in two months, when you’re owning moves like we’re possessing in the last several times or so, that amount could clearly fluctuate,” he mentioned, including company action was up about a third for the 2nd quarter.

Given that Citi’s fixed cash flow markets business was a great deal greater than its fairness business, the government reported Citi was on the lookout for “low hanging fruit” to extend in equities, which includes trying to get to protected equities organization from its mounted money purchasers.

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Reporting by Noor Zainab Hussain and Sinéad Carew Editing by Edmund Blair

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