Story Stock: Citigroup's $20 Billion Revenue Pushes Dow Higher

The company gets some good news in the stock market after a year of pending investigations.
4:20 | 04/14/14

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Transcript for Story Stock: Citigroup's $20 Billion Revenue Pushes Dow Higher
Event company -- has the financial markets closed for this month. He's this story stuck and today we're looking at Citigroup banking -- financial giant which. Enjoy some better than expected first quarter earnings so let's bring in argument from Yahoo! finance breakdown of the numbers sports and break Citigroup really. Take a lot of people by surprise. Yeah they. They earned about twenty million dollar -- twenty billion revenue in the first quarter again. About four billion in profit that was a little bit higher than analysts were expecting so they got a nice pop today about three and a half percent the stock was up. -- has had a terrible year there they're stock is still down now more than 9% for the year. But this was a little bit of good news and I think analysts and investors were expecting so they. I think they'll take it. Well let's take a look at that to date chart that the city how -- done I just based -- anatomy pretty dramatic -- obviously. Yeah they could -- -- city -- lot of problems this year first of all they've got. There are under investigation for fraudulent loans in Mexico it's not a huge amount of money but it to kind of thing that you -- they should have a better -- line. -- also they also got smacked down by the Federal Reserve earlier this year the Fed basically said they don't have enough capital on their books. Given given all the loans and other leverage they've got so they have to -- re engineer their books a lot that makes it look like did the bank is not really. Completely in charge of everything its got going Citigroup is. As as you know a huge sprawling bank critics have said for years it's just too big to be managed effectively. The CEO said he's gonna get that under control but so far this year hasn't so I think they're happy to have a little something to cheer over -- city. Well you look at the size of it is the third largest bank in the country but as far as fraudulent go. Is that behind them now -- is -- -- everyone has moved on has moved past stores are still the potential for additional investigations. I think they're working through the details on I mean that's one of these things. Which we hear about this sort of thing from a lot of banks and it's not a huge amount of money it's not a core part of their business. What she's gonna struggle in the future probably for a couple of other reasons stand first of all. Like other banks their -- -- -- expecting revenue in profits from trading to decline. As these. As new restrictions come into place on what banks are allowed to do. Also the market as -- as as a whole has just been kind of going sideways this year that affects banks as well. And because interest rates have gone up. Banks are not lending nearly as much in mortgages. As they were for the last year -- so that part of the business gonna go down to yourself. So serious a bank where. Eight -- it's got a lot of -- it's facing a lot of difficulty. And I think it's quite plausible that. We're saw this little pop but city could be an inferred more tough times later this year. You talk about the reflection that's been going on how the company and the CFOs and that it found that second set -- fraudulent loans. It was is linked to a supplier of Mexican oil company Pemex those laws were about thirty million dollars. And given the fact that those kinds of headlines continued to bubble up so are investors basically -- -- -- -- that kind of news is moving actual stock price. Dan pick a bank. And I think you could come up with some sort of global scandal -- -- JPMorgan. Has a much bigger problem going -- going on in China with. Allegations there that it basically bought favored treatment from the government by hiring you know relatives of well placed. Politburo members and things like that banks are all over the world they have all sorts of dealings I I think it's investors are jaded to start with at this point I mean they just were really want to see the numbers. So in seeing it seems that Citigroup has not been giving those numbers and because of the problems with the Fed you know again this deal -- -- did not have enough capital on the books. They cannot increase their dividend payment. Which which is bad for shareholders they would've liked to buy back some stock but they're not allowed to do that either. Also bad for shareholder so that's the kind of thing that really gets I think investors' attention when. A bank cannot do the types of things other banks are -- are able to do by the way so even compared to which pierce city has been struggling. A spotlight on city or irregular from Yahoo! finance Rick thanks so much appreciate -- bent -- and of course you've been -- store stocks with for latest headlines. I'm down Cutler New York.

This transcript has been automatically generated and may not be 100% accurate.

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