⚠ Card Losses Nearly DoubledHigh threat

Citigroup (C) — threat to the moat

Citi's card losses doubled from their pandemic low, and a recession would take them higher still.

The profit collapse in cards was a credit story. The segment's net credit loss rate was 2.28% in 2021, 4.51% in 2024 and 4.29% in 20251. Citi's guidance range for 2026 is 4.0% to 4.5%2.

U.S. Consumer Cards net credit loss rate (%)2.28%20214.51%20244.29%2025Citigroup historical supplement, 3 April 2026
Nearly double the 2021 rate.

The 2021 rate was unusually low, because government support during the pandemic let cardholders pay down debt. The move back to more than 4% was a return to normal, but it took net income from $6,496 million to $2,084 million in three years3.

A card lender cannot escape this. It lends unsecured to millions of households, and a rise in unemployment shows in charge-offs within months.

The latest quarter was flat on a year earlier. Net credit losses in cards were $1,850 million in the second quarter of 2026, against $1,856 million a year before and $1,742 million in the first quarter4.

Late payments tell the same story before the losses do. Loans 90 days or more past due were 0.55% of general-purpose card loans at the end of 2021 and 1.32% at the end of 2025; on private-label cards they went from 1.01% to 2.13%5.

Citi's reserves assume a weaker economy than today's. Its credit-loss allowance uses a scenario-weighted average unemployment rate of 5.2% over eight quarters, and 6.9% in its downside case6. The card reserves were 7.7% of loans at the end of 20257.

The rate eased through 2025: 4.72% of loans in the first quarter, 4.43% in the second, 4.05% in the third and 4.00% in the fourth8.

The guidance range is the line to watch. A loss rate above 5% for a year would take the segment's return well below the cost of equity.

References
  1. ReportedThe segment's net credit loss rate was 2.28% in 2021, 4.51% in 2024 and 4.29% in 2025.
    Citigroup Historical Quarterly Financial Data Supplement 2021-2025 recast to the first-quarter 2026 segments - Wealth and U.S. Consumer Cards: revenue by line, client balances, net new investment assets, branches, loans, credit losses and returns. — FY2021-FY2025 · publ. 3 April 2026 · source ↗
  2. ReportedCiti's guidance range for 2026 is 4.0% to 4.5%.
    Citigroup 2026 Investor Day financial overview presentation - RoTCE targets, business targets for Services, Cards and Markets, efficiency ratio, transformation, liquidity and capital. — May 2026 · publ. May 2026 · source ↗
  3. ReportedThe move back to more than 4% was a return to normal, but it took net income from $6,496 million to $2,084 million in three years.
    Citigroup Historical Quarterly Financial Data Supplement 2021-2025 recast to the first-quarter 2026 segments - Wealth and U.S. Consumer Cards: revenue by line, client balances, net new investment assets, branches, loans, credit losses and returns. — FY2021-FY2025 · publ. 3 April 2026 · source ↗
  4. ReportedNet credit losses in cards were $1,850 million in the second quarter of 2026, against $1,856 million a year before and $1,742 million in the first quarter.
    Citigroup second-quarter 2026 earnings release, Form 8-K exhibit 99.1 - Wealth and U.S. Consumer Cards results and key metrics. — Q2 2026 · publ. 14 July 2026 · source ↗
  5. ReportedLoans 90 days or more past due were 0.55% of general-purpose card loans at the end of 2021 and 1.32% at the end of 2025; on private-label cards they went from 1.01% to 2.13%.
    Citigroup Historical Quarterly Financial Data Supplement 2021-2025 recast to the first-quarter 2026 segments - Wealth and U.S. Consumer Cards: revenue by line, client balances, net new investment assets, branches, loans, credit losses and returns. — FY2021-FY2025 · publ. 3 April 2026 · source ↗
  6. ReportedIts credit-loss allowance uses a scenario-weighted average unemployment rate of 5.2% over eight quarters, and 6.9% in its downside case.
    Citigroup 2026 Investor Day financial overview presentation - RoTCE targets, business targets for Services, Cards and Markets, efficiency ratio, transformation, liquidity and capital. — May 2026 · publ. May 2026 · source ↗
  7. ReportedThe card reserves were 7.7% of loans at the end of 2025.
    Citigroup 2026 Investor Day financial overview presentation - RoTCE targets, business targets for Services, Cards and Markets, efficiency ratio, transformation, liquidity and capital. — May 2026 · publ. May 2026 · source ↗
  8. ReportedThe rate eased through 2025: 4.72% of loans in the first quarter, 4.43% in the second, 4.05% in the third and 4.00% in the fourth.
    Citigroup Historical Quarterly Financial Data Supplement 2021-2025 recast to the first-quarter 2026 segments - Wealth and U.S. Consumer Cards: revenue by line, client balances, net new investment assets, branches, loans, credit losses and returns. — FY2021-FY2025 · publ. 3 April 2026 · source ↗
Sources
Generated September 28, 2026