Citigroup lifts 2026 ROTCE target above 11%

Citigroup shares fell 1.9% on 14 September after the bank updated its financial outlook. Speaking at the Barclays 24th Annual Global Financial Services Conference, CFO Gonzalo Luchetti stated that the company expects full-year 2026 return on tangible common equity (ROTCE) to exceed 11%, up from its prior forecast of 10% to 11%.

Management projects 2026 net interest income excluding Markets to grow at the high end or slightly above its prior 5% to 6% range, aided by higher activity in lending, deposits, payments, investment banking, and wealth management. The bank also aims for a 2027 to 2028 ROTCE target of 11% to 13% and a medium-term goal of 14% to 15%.

Annual stranded costs fell from roughly $1.3 billion to about $200 million per quarter, and teams are reviewing more than 100 processes for added savings. Citigroup will pull forward roughly $500 million of planned spending into 2026 for severance and investments in Cards and Wealth, yet it still expects its 2026 efficiency ratio to beat its 60% goal. The bank also expects about $800 million of deferred tax asset utilization in 2026.

Over the past six months, Citigroup shares gained 26.9%, compared with 26.5% for its industry peers. The stock trades at a forward price-to-earnings multiple of 10.95, below the industry average of 13.99.