Citi, Bank of America post higher profits as – Business News
Two of the largest US banks, Citigroup and Bank of America, notched better-than-expected profits within the first three months of this yr as merchants raked in higher revenues amid President Donald Trump’s menace to begin a world commerce battle.
The banks reaped the advantages of traders adjusting their portfolios after being spooked about a doable return to protectionist commerce insurance policies, following a comparable trend at fellow Wall Street giants JPMorgan and Goldman Sachs.
President Trump had unveiled a string of ‘reciprocal’ tariffs on April 2, dubbed Liberation Day, to be slapped on imported items, solely to carry out a last-gasp U-turn final Wednesday as US authorities borrowing prices rose.
Citi CEO Jane Fraser has embarked upon a turnaround plan on the bank to improve effectivity and cut prices. AP
Citi stated its Q1 revenue rose 21% to $4.1 billion, or $1.96 per share, on higher income and decrease prices from the identical time final yr, whereas BoA rose from 11% to $7.4 billion from 2024.
Analysts surveyed by the London Stock Exchange Group had forecast Citi’s $1.85 per share, whereas they predicted BofA earnings to quantity to 82 cents per share.
Citi’s equities merchants benefitted from “increased market volatility” and an uptick in consumer transactions, powering revenues to $1.5 billion over these previous three months and up 23% year-on-year.
The bank’s fixed-income merchants generated $4.5 billion in income, primarily in currencies and authorities bonds, an 8% increase from the identical time in 2024.
BofA additionally noticed equities trading income soar, rising by 17% to $2.2 billion, whereas fixed-income income rose 5% to $3.5 billion.
“Trading results were the star of the show,” stated Stephen Biggar, banking analyst at Argus Research, who warned executives that they could see additional a dip in dealmaking this yr.
In the primary three months of 2025, US M&A exercise fell 13%, based on information from Dealogic, and Biggar stated that one other collapse “could doom a 2025 recovery if tariff turmoil is not resolved soon.”
BofA CEO Brian Moynihan pointed to a robust efficiency from the bank’s merchants that helped energy the firm’s Q1 profits. Getty Images
Citigroup posted $1.1bn in investment banking charges during the primary three months of the yr, up by 14% in contrast with a yr earlier, whereas BofA stated investment banking charges stood at $1.5 billion, down 3% from the primary three months of 2024.
BofA CEO Brian Moynihan stated that the bank’s “business clients have been performing well and consumers have shown resilience.”
But in a thinly veiled reference to the continued menace of a world commerce battle, the 65-year-old warned that Americans “potentially face a changing economy in the future.”
President Trump paused a plan to hit imported items from dozens of nations with heavy tariffs for 90 days, with solely high levies remaining in place towards China. Michael Brochstein/ZUMA / SplashNews.com
Fraser struck a more optimistic notice over Trump’s makes an attempt to restructure America’s commerce ties with dozens of nations.
“When all is said and done, and longstanding trade imbalances and other structural shifts are behind us, the U.S. will still be the world’s leading economy, and the dollar will remain the reserve currency,” she stated after Citi’s outcomes had been launched.
Last Friday, JPMorgan CEO Jamie Dimon advised traders that the US financial system would face “considerable turbulence” if Trump went forward together with his plan to slap tariffs on imported items.
