) board of directors approved a $1.2 billion share buyback
program in the first quarter of 2014. Additionally, the board
announced an unchanged quarterly dividend of one cent per share
on its common shares. This will be paid on May 24 to shareholders
of record as of May 6.
These actions were part of Citi's capital plan, which was
approved by the Federal Reserve under the 2013 Comprehensive
Capital Analysis and Review (CCAR). These were anticipated to
mitigate the probable dilution resulting from Citi's annual
incentive compensation grants.
With the latest share repurchase announcement, Citi has come a
long way since 2008, when it took $45 billion of bail-out money
to survive the economic downturn. Through the latest share
buyback program, the company showed that its capital position has
Further, it shows that Citi's efforts to streamline its
operations are now bearing fruit. Over the past few years, the
company has been restructuring its business, retrenching
employees, selling assets and trimming costs to improve
The share buyback announcement will bring relief to investors of
the company. Citi suffered a setback last year when the Fed,
after considering the company's capital plan, stated that Citi's
Tier 1 common capital ratio would fall to 4.9%. Hence, the
regulator rejected the company's capital actions.
Citi currently carries a Zacks Rank #3 (Hold). Other better
performing bank stocks include
JPMorgan Chase & Co.
Fifth Third Bancorp
State Street Corp.
). All these stocks carry a Zacks Rank #2 (Buy).
CITIGROUP INC (C): Free Stock Analysis Report
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