Citigroup reported a net loss during the fourth quarter of 2017 after taking a hit from the Tax Cuts and Jobs Act.
The bank reported a net loss for the fourth quarter of a full $18.3 billion, or $7.15 per diluted share. This is down from last year’s net income of $3.6 billion or $1.14 per common share.
This loss, the bank explained, is due to the enactment of tax reform. Tax reform caused the bank to pay $19 billion related to the re-measurement of its deferred tax assets arising from a lower U.S. corporate tax rate.
The loss is offset in improvements in its legacy mortgage portfolio. Net credit losses declined 75% to $15 million, reflecting the impact of ongoing divestitures and improvements in the legacy mortgage portfolio. The net loan loss release was $52 million, mostly related to the legacy mortgage portfolio, as compared to a release of $82 million in the prior year period. (To read Citi's full earnings report, click here.)
And Citi wasn’t the only bank which reported losses due to tax reform. JPMorgan Chase reported its net income plummeted 37% due to tax reform.
Excluding this payout due to tax reform, net income came in at $3.7 billion, an increase of 4% from the year before.
Citi reported a slight increase in revenue from $17 billion in the fourth quarter 2016 to $17.3 billion in the fourth quarter 2017.
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