Citigroup reports surprise drop in quarterly revenue

Citigroup Inc reported a surprise drop on Monday in quarterly revenue due to a steep decline in its fixed income trading business, hurt by volatility in financial markets at the end of the year.

Shares of the company fell nearly 1.6 percent to $55.80 in early trading. “A volatile fourth quarter impacted some of our market sensitive businesses, particularly fixed income,” Chief Executive Officer Michael Corbat said in a statement.

Fixed income revenue fell 21 percent in the quarter due to widening credit spreads.

The squeeze on revenue caused Citi to narrowly miss its efficiency target for the year, despite a 4 percent decline in expenses.

The bank ended the year with an efficiency ratio of 57.4 percent, just shy of its 57.3 percent goal. A lower efficiency ratio means a bank is better at managing its overhead expenses as a percentage of revenue.