Citigroup sets aside $1.9bn due to Russian-Ukraine conflict

NEW YORK: Citigroup said Thursday it set aside $1.9 billion in reserves due to Russia’s invasion of Ukraine, which was one factor driving a drop in the bank’s quarterly earnings.

The reserve build was “related to Citi’s exposures in Russia and the broader impact of the conflict in Ukraine on the macroeconomic environment,” Citigroup said.

The bank reported a 46 percent decline in first-quarter profits to $4.3 billion, while revenues dipped two percent to $19.2 billion.

Citigroup’s earnings were also dragged lower by increased expenses, while its banking operations had a mixed performance.

Chief Executive Jane Fraser cited a difficult geopolitical and macro environment as a factor in weaker investment banking results, while pointing to trade loans and cross-border transactions as areas of strength.

Citi also scored higher net interest income, benefiting from the Federal Reserve’s shift in monetary policy.

Citigroup’s report comes a day after JPMorgan Chase also reported lower profits. Bankers have said the US economy remains on solid footing, while warning of increased recession risk due to the Ukraine invasion, rising inflation and uncertainty connected to the shift in Fed interest rate policy.

Shares of Citi rose 1.6 percent to $50.93 in pre-market trading.