Citi Clears the Deck on Q4 Earnings

Citigroup (C) reported earnings well below analysts expectations for the fourth-quarter sending shares lower in early trading. The jumbo-sized super bank saw trading revenues rebound but took a $2.32 billion charge for legal fees and lay-offs. New CEO Michael Corbat said the company continues to be hampered by regulatory matters and issues related to the financial crisis.

Said another way, the new CEO reported a big earnings miss after taking a huge number of charges based on stuff his predecessor Vikram Pandit didn't deal with properly. The numbers don't matter much, if at all. The question for investors is what to expect moving forward under the current management team.

Yahoo! Finance senior columnist Michael Santoli thinks Corbat is taking the opportunity to keep expectations in check as he finds his footing after the abrupt exit of Pandit three months ago. "A new CEO can say 'we're still working on it and maybe we're not as far along as we want to be, but we're making progress.' I think that's the message right now," Santoli says.

Related: Shocker at Citigroup as CEO Vikram Pandit Abruptly Resigns

The macro environment is unquestionably improving for the banking space on the economy as a whole. The improvement is gradual but tangible. That gives the banks breathing room as they untangle the mess left in the wake of the Great Recession and housing implosion.

Numbers in the earnings reports from banks aren't exactly "fake." They're just clouded with so much noise and uncertainty that you need to look beneath the headlines. As was the case with Wells Fargo (WFC) and Goldman (GS), the tone out of Citi was one of gradual improvement.

As far as Corbat and Citi investors are concerned, the rest is just noise.