Ah, Citigroup Inc., that ever-so-sturdy titan of finance, is now preparing for the worst. Yes, folks, loan losses are creeping up on them like a shadow in the dead of night, all thanks to the relentless beast known as macroeconomic uncertainty.
To prepare for this impending doom, the investment bank is setting aside hundreds of millions more than last quarter. A mere drop in the ocean, or perhaps a life raft? Only time will tell, as reported by Bloomberg.
Vis Raghavan, Citigroup’s head honcho of banking, took the stage at a Morgan Stanley conference this week, speaking of credit reserves and how they can swing faster than a pendulum in a hurricane. “Given the macro environment,” he said with an air of cautious optimism, “cost of credit compared to last quarter, we expect to be up a few hundred million.” Sure, Vis, sure… just a *few hundred million* more.
But wait—there’s hope on the horizon! Bloomberg has analysts forecasting that loan losses may, just may, take a dip in the second quarter. A relief, but also a reminder that no one really knows what’s coming next.
And yet, despite the storm clouds, Raghavan reassures us—80% of Citigroup’s corporate exposure is to “high creditworthiness” entities. What a relief! Maybe they won’t be buying up the next yacht in the repo sale after all.
“We still have a few more weeks to go in this quarter, but on the credit overall, I’m incredibly reassured of the quality,” said Raghavan, undoubtedly wiping his brow. Credit, quality, reassured… a delightful cocktail of corporate buzzwords, wouldn’t you agree?
But hold on to your hats, because there’s a twist. The investment banking division? Oh, it’s hurting, my friends. Turns out, uncertainty isn’t the best friend of those in high finance. “What investment banking likes is clarity,” Raghavan mused. “Either it’s really bad or really good. Just give us the news, but that middle area of not knowing really freezes market activity.” Well, guess what, Vis? The middle area is exactly where we live—stuck in limbo, waiting for some news that may or may not make sense.
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2025-06-12 15:01