Citigroup posts $3.8 billion Q3 net
18 Oct 2011
Citigroup's core revenue was down in the third-quarter but the bank's earnings were better than expected and credit losses fell sharply.
The lender followed JP Morgan Chase with an announcement of a sharp slide in underlying trading revenue with falls of over 30 per cent in fixed income, equity sales and trading.
Celebrating ''another quarter of solid operating results'', Vikram Pandit, chief executive, announced he had decided to revive the group's private-label credit cards business, that was slated for disposal, after it registered continued improvement in earnings.
Citi's net income stood at $3.8 billion for the three months to the end of September, which was 74-per cent higher against the same period a year ago. Shares in the bank that had fallen by a third in the last year were up 3.2 per cent in early trading to $29.32 following the announcement of the quarterly results.
A ''credit valuation adjustment'', an accounting treatment skewed performance contributing $1.9 billion to earnings based on the lower value of Citi's own debt.
However, earnings at $1.23 per diluted share were still significantly higher than analysts' estimates of $0.81 a share.
Third-quarter revenues stood at $20.8 billion and without the accounting adjustment, they were down 8 per cent at $18.9 billion.