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Citi (C) Likely to Raise Bonus by 10% on Solid Trading Performance
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Jumping on the bandwagon of other big global banks, including Bank of America (BAC - Free Report) , JPMorgan (JPM - Free Report) , Goldman Sachs (GS - Free Report) and Deutsche Bank (DB), Citigroup (C - Free Report) might also take a decision on the bonus payments of fixed-income traders soon. Per Bloomberg, the bank is likely to increase the bonus pool for its fixed-income traders by 10%, supported by its impressive trading performance amid the pandemic.
Particularly, traders’ dealing in fixed income, currencies and commodities bonus pool is expected to escalate, while the equity traders’ pool might be kept the same, according to the source. However, Citigroup’s spokeswoman has refrained from commenting on this.
Citigroup’s rates and currencies traders generated revenues worth $10.1 billion as of Sep 30, up 45% year over year, on the highly volatile markets due to the pandemic. Also, within spread products and other fixed-income desks, $4 billion was recorded in revenues, up 36%.
Notably, at a conference this month, Citigroup’s chief financial officer Mark Mason mentioned that owing to a stellar market performance, revenues from trading businesses, fixed income and equities are likely to be up in the mid-teens for 2020. As of Sep 30, 2020, Citigroup had $17 billion in provisions for bad loans set aside amid the coronavirus pandemic, which caused overall earnings to decline more than 50% during the same period. Despite this, the bank is on the verge of rewarding traders for their stupendous performance.
“We’ve got to be mindful of our returns and our shareholders, we’ve got to be mindful of our environment that we’re in and the many challenges that are out there for people and certain businesses,” chief executive officer Michael Corbat said in an interview with Bloomberg. “And at the same time we have to be competitive. In our industry, we’re fortunate to have good talent. And we’ve got to recognize that”, he added.
Since the outbreak of the pandemic in mid-March, trading revenues have skyrocketed, thanks to the substantial rise in market volatility along with higher client activity. Therefore, big banks are on the path of rewarding traders for the performance. However, banks are getting tight-fisted in deciding bonuses due to the prevailing global health crisis situation.
Similar Moves
Despite recording impressive trading performance during the year, BofA’s senior executives are planning for year-end bonuses similar to the previous year. Another Wall Street biggie JPMorgan plans to boost year-end compensation for its sales and trading division by up to 20%. Goldman also might increase bonus for the trading division by 20%. Among other global banks, Deutsche Bank is also planning to reward fixed-income traders with a 10% increase in bonus pool.
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
Citi (C) Likely to Raise Bonus by 10% on Solid Trading Performance
Jumping on the bandwagon of other big global banks, including Bank of America (BAC - Free Report) , JPMorgan (JPM - Free Report) , Goldman Sachs (GS - Free Report) and Deutsche Bank (DB), Citigroup (C - Free Report) might also take a decision on the bonus payments of fixed-income traders soon. Per Bloomberg, the bank is likely to increase the bonus pool for its fixed-income traders by 10%, supported by its impressive trading performance amid the pandemic.
Particularly, traders’ dealing in fixed income, currencies and commodities bonus pool is expected to escalate, while the equity traders’ pool might be kept the same, according to the source. However, Citigroup’s spokeswoman has refrained from commenting on this.
Citigroup’s rates and currencies traders generated revenues worth $10.1 billion as of Sep 30, up 45% year over year, on the highly volatile markets due to the pandemic. Also, within spread products and other fixed-income desks, $4 billion was recorded in revenues, up 36%.
Notably, at a conference this month, Citigroup’s chief financial officer Mark Mason mentioned that owing to a stellar market performance, revenues from trading businesses, fixed income and equities are likely to be up in the mid-teens for 2020. As of Sep 30, 2020, Citigroup had $17 billion in provisions for bad loans set aside amid the coronavirus pandemic, which caused overall earnings to decline more than 50% during the same period. Despite this, the bank is on the verge of rewarding traders for their stupendous performance.
“We’ve got to be mindful of our returns and our shareholders, we’ve got to be mindful of our environment that we’re in and the many challenges that are out there for people and certain businesses,” chief executive officer Michael Corbat said in an interview with Bloomberg. “And at the same time we have to be competitive. In our industry, we’re fortunate to have good talent. And we’ve got to recognize that”, he added.
Since the outbreak of the pandemic in mid-March, trading revenues have skyrocketed, thanks to the substantial rise in market volatility along with higher client activity. Therefore, big banks are on the path of rewarding traders for the performance. However, banks are getting tight-fisted in deciding bonuses due to the prevailing global health crisis situation.
Similar Moves
Despite recording impressive trading performance during the year, BofA’s senior executives are planning for year-end bonuses similar to the previous year. Another Wall Street biggie JPMorgan plans to boost year-end compensation for its sales and trading division by up to 20%. Goldman also might increase bonus for the trading division by 20%. Among other global banks, Deutsche Bank is also planning to reward fixed-income traders with a 10% increase in bonus pool.
Currently, Citigroup carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Shares of the company have gained 11.9% in the past six months compared with 19.8% growth recorded by the industry.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>