Jan 17 (Reuters) - Citizens Financial's profit

beat expectations in the fourth quarter on Friday, as investment

bankers cashed in on a rebound in capital markets activity.

Wall Street got a leg-up last year as dealmaking activity

recovered from a decade-low in 2023, while improving confidence

spurred companies to issue debt and equity.

Bankers expect global deal volumes to surpass $4 trillion in

2025, fueled by optimism around interest rate cuts and less

regulation under the incoming Donald Trump administration.

Citizens' capital market fees soared 39% to $121 million,

driven by higher loan syndication and mergers and acquisitions

fees.

The upbeat results mirror those of Wall Street's biggest

banks, whose quarterly earnings were also bolstered by a rebound

in dealmaking activity.

Citizens CEO Bruce Van Saun said last month the bank's

capital markets pipelines were strong.

NII SET TO GROW IN 2025

Citizens' net interest income - the difference between what

banks pay customers on deposits and earn as interest on loans -

fell 5% over the year earlier to $1.41 billion.

But it climbed 3% over the third quarter and beat analysts'

estimate of $1.40 billion, according to data compiled by LSEG.

The Providence, Rhode Island-based bank expects its

underlying NII to rise between 3% and 5% this year from the 2024

level of $5.63 billion. Analysts expect a 4% increase.

The bank's NII forecast factors in 25-basis-point rate cuts

in the second and fourth quarters.

Citizens' profit was $401 million, or 83 cents per share,

for the three months ended Dec. 31, compared with $189 million,

or 34 cents per share, a year earlier.

Excluding one-time costs, it earned 85 cents per share,

beating analysts' expectations of 83 cents per share.

Shares of the company had risen 32% in 2024, compared with a

32.8% gain in the KBW Bank index.