) --


(C) - Get Report

was the loser among the largest financial names on Friday, with shares pulling back 2% to close at $34.57.

The broad index ended with slight declines, after the U.S. Commerce Department said that despite a slight increase in disposable consumer income during October, consumer spending was down 0.2%. The Commerce Department's Bureau of Economic Analysis said that "the October estimates of personal income and outlays reflect the effects of Hurricane Sandy, which made landfall in the United States on October 29," and while it "cannot quantify the total impact of the storm on personal income and outlays," the Bureau "did make adjustments where source data were not yet available or did not reflect the effects of Sandy."

Meanwhile, the impasse over the fiscal cliff continued, following U.S. Treasury Secretary Timothy Geithner's presentation on Thursday to of a compromise package to Speaker of the House John Boehner (R-Ohio), that included the tax increases for couples earning over $250,000 a year favored by President Obama, along with a new $50 billion stimulus spending package, while not offering the type of spending cuts that Republicans are looking for.

Boehner said to reporters on Friday "there is a stalemate. Let's not kid ourselves," and that raising taxes on the highest earners would be a "crippling blow" to small businesses, according to various reports.


KBW Bank Index


was down slightly to close at 48.54, with 15 of the 24 index components ending the week with declines.

Cost Cutting at Citigroup

Citigroup's shares have now returned 32% year-to-date, following a 44% decline during 2011.

The shares trade for 0.7 times their reported Sept. 30 tangible book value of $52.70, and for 7.5 times the consensus 2013 EPS estimate of $4.64, among analysts polled by Thomson Reuters. The consensus 2014 EPS estimate is $5.04.



on Thursday reported that Citigroup was planning to cut 150 additional investment bank jobs in the fourth quarter, after laying off 1,550 investment banking employees earlier this year, Nomura analyst Glenn Schorr on Friday suggested that the company could benefit from a "named" cost savings program.

Bank of America

(BAC) - Get Report

, for example, calls its massive multistep cost cutting program "Project New BAC," and the expected savings are a big part of the increase in earnings that analysts expect the company to realize in 2014. Analysts on average expect Bank of America to earn 97 cents a share in 2013, increasing to $1.27 in 2014. This is by far the largest estimated percentage increase for any of the "big four" U.S. banks.

Schorr said that "while Citi takes heat for not having a named cost save program similar to many peers, we'd note that a) Citi's efficiency saves for the past two years as a percentage of total expenses are actually in line to better than many of the named programs out there, b) Citi actually has a better efficiency ratio than many peers, and c) Citi actually has some growth elements to the story that maybe make operating leverage a better lens to judge by rather than the "stubborn" $48bn-$50bn of expenses the company continues to manage to," on an annual basis.

The efficiency ratio is, essentially, the number of pennies of overhead expenses a bank incurs for each dollar of revenue. Citigroup's third-quarter tax-adjusted efficiency ratio was 73.94, according to Thomson Reuters Bank Insight, while Bank of America's efficiency ratio was 81.32. Then again,

JPMorgan Chase's

(JPM) - Get Report

efficiency ratio was a much lower 60.44, and

Wells Fargo

(WFC) - Get Report

had an even better efficiency ratio of 57.55.

Schorr rates Citigroup a "Buy," with a $41 price target, and he trails the consensus, estimating that the company will earn $4.50 a share in 2013.

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Written by Philip van Doorn in Jupiter, Fla.

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.