Citigroup Inc (C)

How it makes money

Like any bank, Citi earns money in two ways. The larger part is net interest income — the spread between what it earns on loans, securities and deposits placed with other banks and what it pays on its own deposits and debt: $59.8 billion in 2025 out of $85.2 billion of total revenue. The rest is non-interest revenue ($25.4 billion): trading and market-making results, investment banking fees ($4.4 billion), card interchange ($12.1 billion, reported net of $13.4 billion of card rewards and partner payments), transaction, deposit and custody fees, and advisory and brokerage commissions. Revenue is therefore driven by three different engines at once — loan and deposit volumes and the level of interest rates, client transaction activity, and fee-based balances.

Revenue by segment

The durable advantage sits in Services, not in the bank as a whole. Moving money and settling securities in nearly 160 countries is something only a handful of institutions can do, and corporate treasurers who plug their payment flows into that network do not move them lightly: the segment carried $878 billion of average deposits in 2025, largely operational balances that fund the bank cheaply. Around that core, most of Citi's business is far more contestable — trading, corporate lending and credit cards are priced competitively and clients switch providers, and the group itself flags competition for its co-brand card relationships and from emerging technologies among its risk factors.

Every one of Citi's engines moves with the cycle, though not in step. Card and consumer lending revenue follows employment and spending, and its credit costs rise in downturns — USPB alone absorbed $7.2 billion of credit provisions in 2025. Investment banking fees depend on whether companies feel confident enough to issue and merge: Banking revenue jumped from $6.2 billion in 2024 to $8.2 billion in 2025. Trading revenue tends to rise with volatility, which partly offsets the rest. The steadiest piece is Services, where payment and custody flows continue as long as world trade does. Net interest income adds a separate rate cycle on top.

Key risks

• Macroeconomic, geopolitical and other challenges — Citi lists rising unemployment, recession or slowing growth in the U.S., Europe and other regions, deterioration in consumer and corporate confidence, elevated inflation, market volatility and government fiscal or monetary actions among the conditions that have hurt, and could again hurt, its businesses, cost of credit and results. It cites substantial new import tariffs and a higher U.S. effective tariff rate as a concrete example.
• Changes in interest rates — Movements in interest rates could adversely affect results. With $59.8 billion of the group's $85.2 billion of 2025 revenue coming from net interest income, the level and shape of rate curves in the U.S. and abroad feeds directly into the largest revenue line as well as into deposit costs and the value of the securities portfolio.
• Execution of the simplification and transformation programme — Citi warns it may be unable to achieve the objectives of its simplification, transformation and business performance priorities — the multiyear reorganisation, exit of legacy consumer franchises and overhaul of risk, data and controls infrastructure — within the expected time frame or cost.
• Regulatory scrutiny, consent orders and penalties — Regulatory expectations and scrutiny in the U.S. and globally expose Citi to significant compliance costs and to outcomes that can include large monetary penalties, supervisory or enforcement orders, business restrictions, limits on dividends and changes to directors or officers. The filing notes that in 2024 the Federal Reserve entered into a civil money penalty consent order with Citigroup and the OCC did the same with Citibank.
• Dependence on co-brand and private label card relationships — Citi issues cards under co-branding and private label agreements with retailers and merchants; the five largest such relationships were about 12% of Citi's 2025 revenues. Competition among issuers for these contracts is intense, the agreements have fixed terms and shared economics, and Citi may be unable to renew them on existing terms or at all.
• Credit risk and concentrations of risk — At 31 December 2025 Citi had $409 billion of consumer loans and $344 billion of corporate loans outstanding. A default or downgrade of a borrower or counterparty, or a fall in the value of collateral, exposes the bank to losses, and weakening economies — especially in vulnerable sectors, industries or countries — raise credit costs.
• Operational failures, cyber incidents and technology — A disruption or failure of operational processes or systems could damage Citi's reputation, customers, clients and results, and incidents involving theft, loss, alteration or disclosure of confidential information could bring regulatory penalties, legal exposure and financial losses. Citi separately flags the risks that the development and use of artificial intelligence, by itself and by others, present to its businesses.
• Capital requirements and the ability to return capital — Citi's ability to return capital to common shareholders depends substantially on regulatory capital requirements, including the outcome of the Federal Reserve's stress testing and CCAR regimes. Regulatory guidance could impose more stringent capital, leverage or liquidity requirements, restrict growth or activities, and could eventually require the bank to divest assets or operations.

Top customers account for 12% of revenue

For a bank with tens of millions of retail customers and clients in nearly 160 countries there is no single dominant buyer, but the filing does disclose one real concentration: the five largest co-branding and private label credit card relationships, across Branded Cards and Retail Services, together accounted for approximately 12% of Citi's revenues in 2025. Those are partnerships with retailers and merchants, with fixed terms and shared economics, not end customers.