Citigroup rises following better-than-expected third quarter numbers

Marco Green
October 12, 2017

Citigroup managed to beat the Street consensus for the third quarter on the back of a solid performance by its cash equities and stock underwriting businesses. Per-share earnings were $1.42. "We had revenue increases in numerous products we have been investing in, tightly managed our expenses, and again saw loan growth in both our consumer and institutional businesses".

The fourth-biggest USA bank by assets said on Thursday total revenue rose about 2 percent to $18.17 billion, topping expectations of $17.90 billion.

"We had revenue increases in numerous products we have been investing in, tightly managed our expenses, and again saw loan growth in both our consumer and institutional businesses", Citigroup chief executive Michael Corbat said.

Citigroup's tangible book value per share, an accounting measure of net worth, was $68.55 at the end of September, up 6 percent from a year earlier. Deposits were up 3% to $964 billion in the same time. But revenue from fixed-income trading fell 16 percent to $2.88 billion.

Global consumer banking net income fell 6% year-over-year to $1.17 billion as credit costs rose.

At the end of the quarter, loans totaled $653 billion, an increase of 2% from a year ago.

Citi's ICG carried the bank in the third-quarter, making up for less impressive showings from its consumer unit and its corporate unit, which is winding down legacy assets and saw a net loss of $87 million on the quarter.

Like its peers on Wall Street, Citigroup was expecting another tough quarter for trading revenue amid tepid volatility.

Global consumer banking saw revenues grow 3% from a year ago to $8.4 billion, but net income dropped by 6% $1.17 billion, which the bank attributed to higher cost of credit.

While Citi's trading desks focus heavily on bond and currency trading, it was the bank's other trading desks that stood out. However, the bank's trading revenue was down just 11% from the same quarter a year ago, to $3.63 billion, compared with the bank's forecast of a roughly 15% drop.

On a positive note, Citi's common equity Tier 1 ratio improved from 12.6% in the year-earlier quarter to 13.0%.

Citi has beaten its EPS estimates every quarter since the start of 2014.

Other reports by Click Lancashire

Discuss This Article

FOLLOW OUR NEWSPAPER