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Investing.com -- Fitch Ratings has affirmed Citigroup Inc.’s long-term and short-term issuer default ratings at ’A’ and ’F1’ respectively, with a stable outlook.
The credit rating agency also affirmed Citigroup’s Viability Rating at ’a’ and maintained the Government Support Rating at ’ns’ for both Citigroup and its primary operating bank subsidiary, Citibank, N.A.
Fitch’s decision reflects Citigroup’s progress in regulatory remediation and improvements to its business profile. The bank has successfully executed against its 2022 investor day strategy, including exiting international consumer franchises, reorganizing segments, simplifying its organization, investing in systems, and improving governance.
For the six months ended June 2025, Citigroup reported double-digit returns on tangible common equity across most operating segments while maintaining leadership in core cash management, securities services, and fixed-income trading businesses.
The bank’s expenses declined 4% in 2024 and are expected to decrease further when adjusted for severance and other one-time charges. However, Citigroup’s medium-term return on tangible common equity target of 10%-11% would remain below higher-rated U.S. peers.
Citigroup has strengthened its risk management capabilities and processes, which Fitch expects will facilitate regulatory remediation and reduce operational losses. The bank’s asset quality has stabilized, with net charge-offs stabilizing as of year-end 2024.
As of the second quarter of 2025, Citigroup’s CET1 ratios of 13.5% under the standardized approach and 11.9% under the advanced approach remained above regulatory minimums. The bank raised its dividend to $0.60 per share following the 2025 stress test and remains committed to a year-end CET1 target of 13.1%.
Citigroup’s funding profile is supported by a large, stable deposit base with 4.3% U.S. market share as of mid-year 2024. Deposit growth of 5.7% year-to-date supports asset repricing and net interest margin expansion.
Fitch noted that a sustainable improvement in operating profit to more than 2% of risk-weighted assets, stronger efficiency, and broad-based revenue growth comparable to higher-rated peers could result in a positive rating action in the future.
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