This never-ending process has yet to bear fruit, although Citi finally seems to be getting back on track. After two decades of underperformance, many observers had come to believe that the best option was still to break up the group and sell it off, but the regulator saw things differently.

Appointed in 2021 and coming straight from McKinsey, director Jane Fraser had her work cut out for her. She immediately reorganized the bank's staff and operations. In retail banking, Citi exited thirteen countries, including China, India and the UK, among other upheavals.

The group has slashed costs and reorganized around its services division, the only truly profitable one, accounting for a quarter of sales but half of consolidated profit. Fraser's supporters applaud a rational strategy; his critics, on the other hand, see it as nothing more than cosmetic manipulation.

Last year's results may well put a smile on the faces of the former. Net income jumped by 37% thanks to rigorous cost control and, as at JPMorgan, a good performance in the investment banking segment, which offset a more gloomy situation in the retail banking segment, caught between a lack of growth on the one hand and rising financing costs on the other.

Citi is keeping its net interest margin more or less in line by maximizing the dividends distributed by its subsidiaries and, as at JPMorgan, by focusing on consumer loans via its credit cards. In addition, its non-performing loan ratios will not increase in 2024, in contrast to the bank headed by Jamie Dimon, which has a reputation for fastidious risk management.

In either case, it is to be hoped that future circumstances do not prove the proponents of the cosmetic manipulation theory right.

Citi remains in the sights of the regulator, with whom the group enjoys a difficult relationship. Its audit and compliance systems are regularly found wanting. At the same time, it is difficult for the bank to optimize its cost structure when it has to invest massively in modernizing its procedures; last year, new breaches resulted in a fine of $136 million.

All these factors make Fraser's equation a complicated one to solve. The worst has been avoided for the time being, but the patient is still on the operating table and his profitability has not improved in three years. It is quite possible that the treatment administered is not powerful enough to cure a disease that has become too deep-rooted, given that a deleterious corporate culture cannot be reformed with a snap of the fingers.

The general optimism about the banking sector - which should also be a wake-up call for investors - did not, however, deter Citi. Having fallen to x0.4 per share at the end of 2023, its valuation had rebounded to x0.8 per share by the end of 2024. While this is three times less than JPMorgan, the latter's profitability is also three times that of Citi.

Thirty years ago, under the leadership of Sandy Weill - Jamie Dimon's mentor - Citi was the most powerful bank on Wall Street. Those days are long gone, and it is now its own sick man. This may well give JPMorgan shareholders something to philosophize about...