Citi warns trading revenue on course for 15% fall

Citigroup's trading revenue is on pace to drop 15 per cent in the third quarter from a year earlier as volatility remains "somewhat subdued", chief financial officer John Gerspach has said.

Last year’s performance benefited from a boost in activity as clients wagered on prospects for the US election, while this quarter has seen no comparable catalyst, Mr Gerspach told investors on Monday at a conference hosted by Barclays in New York. The last three weeks of this month could swing the quarterly results, he said.

The biggest investment banks posted declines in trading revenue in the second quarter as volatility dropped and as asset managers waited to see if central banks would raise interest rates and if Donald Trump’s administration could enact any of its policy goals. The calm markets helped many banks’ other businesses, including wealth management.

Citigroup reported $4.07 billion (€3.4bn) of trading revenue in the third quarter of last year, according to the company's earnings supplement. A 15 per cent drop would mean revenue of $3.46 billion (€2.9bn), which would be the lowest quarterly figure since the final three months of 2015.