Expense control and share repurchases combined to push Citigroup’s earnings per share past Wall Street expectations in the first quarter and kept its 2020 financial targets within reach, but the bank’s struggle to increase revenues persisted.

Earnings per share, at $1.87, was up 11 per cent from a year ago and ahead of the $1.80 analysts had expected. Most of that increase was due to a 9 per cent decline in the share count. Revenues were down 1 per cent from the year before, excluding a one-time 2018 gain, in line with estimates.

Operating expenses fell faster than revenues, though, as compensation costs fell 3 per cent, allowing the company to make progress toward its goal of improving its returns on equity, which have trailed those of the bank’s big rivals.

Citi shares rose slightly in pre-market trading on Monday.

“Our earnings reflect the progress we are making to improve our return on and return of capital,” CEO Mike Corbat said.

Citigroup has promised investors that in 2020 its returns on tangible common equity (ROTCE) will reach 13.5 per cent and its efficiency ratio (operating expenses as a proportion of revenue) will fall to 53 per cent. Questions about the achievability of the targets have persisted, especially given the bank’s uneven history of hitting its stated goals.

For the first quarter, expense control and capital return helped both measures improve: ROTCE hit 11.9 per cent, up 0.4 per cent from the year before, and its efficiency ratio was 57 per cent, an improvement of almost a full percentage point.

Results in Citigroup’s markets businesses were better than the bank had forecast just over a month ago, when chief financial officer Mark Mason forecast that the equities and fixed income trading units would be down, in aggregate, in the mid-single digits. In the event the decline was just 5 per cent, with fixed-income trading up 1 per cent, well ahead of the 8 per cent decline rival JPMorgan reported last week, and equities declining 24 per cent, against a 13 per cent decline at JPMorgan.

Citigroup’s investment banking business increased revenues by 20 per cent.

In Citigroup’s consumer business, revenue was flat with the year before. Investor attention has been focused on the bank’s industry-leading card business, particularly its Citi-branded cards in the US, where growth stagnated in 2018. Revenue growth in branded cards rose by 5 per cent in the first quarter, excluding a one-time gain in 2018.

The bank senior management has undergone a significant reshuffle over the past year. Just last week Jamie Forese, the head of Citigroup’s institutional business who was widely considered a leading candidate to succeed Mr Corbat, retired and was replaced by Citi’s market chief Paco Ybarra. In 2018, Citi announced the departure of its veteran chief financial officer John Gerspach, European chief Jim Cowles and its head of North America Bill Mills, and gave Anand Selva sole control of the North American consumer business.

Citi has been the best performing of the big six US bank stocks this year, returning almost 26 per cent, against 12 per cent at JPMorgan and 21 per cent at both Goldman Sachs and Bank of America.

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