Citigroup earnings exceeded expectations

On Friday, October 14, earnings estimates for Citigroup Inc., i.e. the largest financial conglomerate, exceeded market expectations for the third quarter. The reason is a series of interest rate hikes by the Federal Reserve (Fed), influencing the bank's lending activity. Thus, the decline in other areas, including investment and trading, has been offset. 

After several years of near zero interest rates, banks are recording significant gains in net interest income due to higher benchmark lending rates. The Fed is still tightening its monetary policy to combat soaring inflation. 

However, the U.S. central bank's aggressive stance has raised fears of an impending economic slowdown. These actions have contributed to the halt of investment banking activity, turmoil in financial markets, and forced companies and households to suspend their borrowing plans.

"We don't think a financial crisis is coming ... on a scale close to what we've seen," Chief Financial Officer Mark Mason said in a phone call. "We are ready for any eventuality, and we are constantly monitoring the economic environment." 

Citigroup said earnings were $1.5 per share, beating analysts' forecast of $1.42, excluding some items. The company's earnings were also up 6%, crossing the $18.5 billion mark.