NEW YORK (
shares climbed as much as 4.6% Wednesday after positive economic comments from
Chairman Ben Bernanke, even though legislators get set to reconcile a final version of the financial reform bill.
Congress is supposedly to begin the process of reconciling the House and Senate bills on Thursday. Observers have said that President Obama wants Congress to reach an agreement on the bill in two weeks, with the hopes of signing the reform into law before the July 4 break, according to
The New York Times
Analysts seem to diverge on how much the final version of the financial reform package will be detrimental to bank profitability. UBS analyst Glenn Schorr said in a research note last week in which he upgraded
that the ultimate impact of regulatory reform "will be less punitive" than originally thought.
However, CreditSights analysts say even if the law is signed by July 4, uncertainty over the actual financial impact of the new law could remain for some time.
"We believe that many areas of the legislation may remain open to final interpretation from bank regulators. As well other potential changes could come from Basel and FASB," according to an industry note published on Wednesday. "So the ultimate impact on profitability from this round of bank reform may remain unclear for some time."
Regulatory reform aside for a moment, analysts have been increasingly bullish on Citigroup shares of late as the U.S. Treasury continues its exit, the economy shows signs of improvement, the bank continues on its endeavors to shrink its balance sheet and return to profitability, and shares, well, are cheap.
Most recently, Citigroup also announced that it planned to restructure its
subsidiary in preparation for an eventual sale.
Late last month both Goldman Sachs and Oppenheimer upgraded the stock to a buy.
Rochdale Securities analyst Dick Bove said last week that investors should "aggressively" buy
, given that the bank's full value is not reflected in the stock price.
More on Citi Cramer: Must Buy Citi
Still it's likely that
stock will remain near $4 for some time.
>>The Right Time to Buy Citigroup
Citigroup shares were most recently trading up 13 cents to $3.85 on volume of 450 million. Citigroup's stock is up just 16% year to date -- a far cry from the 50% growth levels the shares were experiencing in April, after the bank put out its first quarterly profit since 2007. The stock is down roughly 30% from its 52-week-high of $5.43 last August.
Analysts, on average, expect the bank to make a profit of 7 cents a share in the June-ending quarter on revenue of $22.8 billion of revenue, according to
Shares of other large banks were mixed on Wednesday.
shares were rising modestly, while the stocks of
Bank of America
, JPMorgan Chase and
were in the red.
--Written by Laurie Kulikowski in New York.