Citi cross-border volumes rise in Q3 24 as new products launch
In its latest earnings, major US bank Citi saw its cross-border transaction value grow by 8% in Q3 2024 to $95bn – bringing its total to $278bn for the year so far (compared to $259bn during the same period last year) – and also discussed its latest tie-up with Mastercard Move. More widely, the bank saw revenues grow 1% to $20.3bn, beating analyst estimates.
As we noted in our recent State of Banks report, payments make up a significant part of Citi’s Trade and Treasury Solutions (TTS) segment, which grew by 4% and accounted for 18% of all revenues in Q3 2024. Cross-border transaction value (i.e. flows) is driven by the bank’s Worldlink Payment Services, which enables global payments across more than 135 currencies, though the bank didn’t reference cross-border revenues specifically.
At a recent investor day, Citi said that payments accounts for 74% of the company’s services non-interest revenue (NIR). Assuming this share was the same in Q3 2024, payments’ share of TTS revenue would have grown to 32% during the quarter, compared to 25% in Q3 2023. Based on these figures, payments’ overall share of revenues would have risen to 6% in Q3 2024, up from 4% in Q3 2023.
In the earnings call, Citi CFO Mark Mason noted cross-border transaction growth was a driver of the bank’s 11% NIR growth (excluding the impact from the devaluation of the Argentine peso). Notably, TTS non-interest revenue grew by 41% – faster growth than earlier quarters this year – while the wider TTS segment also achieved over 10% wallet share across Citi’s target markets.
CEO Jane Fraser also referenced Citi’s recent announcement that it is the first global bank to integrate its cross-border services with Mastercard Move, which will enable its users to make near instant payments from 65 countries to 14 receive markets using only their Mastercard debit card details. Payment types span insurance payouts, compensation payments, ecommerce payments and more – though clients need to be in Mastercard-approved markets.
In other news this week, Citi also launched Citi Token Services for Cash – a cross-border liquidity platform built using a private blockchain owned and operated by the bank, which will add to its wider transaction banking offering. It’s another reflection of incumbent banks’ interest in digital currency movement, coming after J.P. Morgan’s similar Onyx solution and a swathe of interest in stablecoins.
Considering that banks often aren’t clear about the impact of cross-border payments on their revenues, Citi’s reference to it as a key driver and recent new product announcements highlight the continued significance of this area for the world’s biggest financial institutions.
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