Citigroup has lowered its base lending rate by 0.25 percentage points, from 7.25% to 7.00%, effective Thursday. The move is intended to make borrowing more attractive amid economic uncertainty and growing competition across the banking industry.
The reduction reflects the bank’s strategy to attract new borrowers and retain existing clients as other major lenders reassess their pricing models. The change could result in meaningful savings for consumers and businesses with loans tied to Citi’s base rate. A borrower with a $100,000 loan could save hundreds of dollars annually under the new rate.
Citigroup, one of the world’s largest financial institutions, operates in more than 100 countries with divisions spanning services, markets, banking, U.S. personal banking, and wealth management. The company’s market capitalization is roughly $177 billion.
The bank has reported 6.7% revenue growth over the past three years, maintaining a 17.3% net margin despite broader economic pressures. Its debt-to-equity ratio stands at 1.74, a level some analysts view as high.
Citigroup’s price-to-earnings ratio of 13.9 and price-to-sales ratio of 2.2 both sit near historical averages. Analysts describe the company’s outlook as “cautiously optimistic,” with target prices averaging $112.73 and a relative strength index of 58 indicating neutral market momentum.
Institutional investors control about 78% of Citigroup’s shares, signaling continued confidence from major financial players. Still, some analysts warn that high leverage could pose risks during downturns or regulatory changes.
Citigroup’s rate cut underscores its effort to strengthen lending activity in a crowded market. The full impact will become clearer in the coming quarters as competitors and consumers adjust to the change.