Citigroup forecasts higher expenses as it revamps its business model

The faster-than-expected economic recovery is opening certain doors to invest in growth businesses, and that means expenses are going to rise this year, Citigroup executives warned Wednesday.

The $2.2 trillion-asset company is now forecasting an annual expense uptick in the mid-single-digit range for 2021, up from 2% to 3% projected in March. The increase grabbed the attention of analysts who wanted to know if the numbers would creep up even more in coming months and whether momentum would extend into 2022.

Chief Financial Officer Mark Mason tried to allay any concerns about rising costs while also defending the company’s decision to spend more money now on business segments that are expected to strengthen profitability and returns in the future.

The quick pace of the economic recovery is driving some of Citigroup’s decisions to make “accelerated investments” in certain areas, such as credit card marketing, CFO Mark Mason says.



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