Send us Feedback

Citigroup (C)
Analysis
SUMMARY
BULLS
BEARS
TOPICS
Data
DATA CENTRAL
STOCK CHART
Financials
SEC FILINGS
BALANCE
INCOME
CASH FLOW

C » Topics » Average Rates- Interest Revenue, Interest Expense, and Net Interest Margin

This excerpt taken from the C 10-Q filed Aug 7, 2009.

Average Rates- Interest Revenue, Interest Expense, and Net Interest Margin

GRAPHIC

In millions of dollars   2nd Qtr.
2009 		  1st Qtr.
2009(1) 		  2nd Qtr.
2008(1) 		  Change
2Q09 vs. 2Q08 		 

Interest Revenue(2)

   $ 19,671   $ 20,583   $ 27,337     (28 )%

Interest Expense(3)

     6,842     7,657     13,351     (49 )
                   

Net Interest Revenue(2)(3)

   $ 12,829   $ 12,926   $ 13,986     (8 )%
                   

Interest Revenue—Average Rate

     4.97 %   5.31 %   6.21 %   (124 ) bps

Interest Expense—Average Rate

     1.94 %   2.16 %   3.29 %   (135 ) bps

Net Interest Margin (NIM)

     3.24 %   3.33 %   3.17 %   7 bps  
                   

Interest Rate Benchmarks:

                          

Federal Funds Rate—End of Period

     0.00-0.25 %   0.00-0.25 %   2.00 %   (175+ ) bps
                   

2 Year U.S. Treasury Note—Average Rate

     1.02 %   0.90 %   2.42 %   (140 )bps

10 Year U.S. Treasury Note—Average Rate

     3.32 %   2.74 %   3.88 %   (56 ) bps
                   
 

10 Year vs. 2 Year Spread

     230 bps     184 bps     146 bps        
                   
(1)
Reclassified to conform to the current period's presentation and to exclude discontinued operations.

(2)
Excludes taxable equivalent adjustment (based on the U.S. Federal statutory tax rate of 35%) of $82 million, $97 million, and $65 million for the second quarter of 2009, the first quarter of 2009, and the second quarter of 2008, respectively.

(3)
Excludes expenses associated with hybrid financial instruments and beneficial interest in consolidated VIEs. These obligations are classified as Long-term debt and accounted for at fair value with changes recorded in Principal transactions.

        A significant portion of the Company's business activities are based upon gathering deposits and borrowing money and then lending or investing those funds, including market-making activities in tradable securities. Net interest margin (NIM) is calculated by dividing annualized gross interest revenue less gross interest expense by average interest earning assets.

        During the second quarter of 2009, the yields across both the interest earning assets as well as the interest earning liabilities dropped significantly from the same period in 2008. The lower cost of funds compared to prior year more than offset the lower asset yields, resulting is slightly higher NIM.

        Net interest margin decreased compared to the first quarter of 2009, driven mainly by lower yields on the consumer loan portfolio both domestically as well as internationally. The second quarter of 2009 NIM also includes the one-time FDIC special assessment of $333 million, which negatively impacted NIM by 8bps. This charge was included in interest expense on deposits.

54

Table of Contents

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki