Citigroup June qtr profit declines 12% to $2.9 bn
Citigroup Monday reported a 12 percent decline in net income at USD 2.9 billion in the three months ended June, driven by losses from stake sale in its Turkish asset.
New York: Citigroup Monday reported a 12 percent decline in net income at USD 2.9 billion in the three months ended June, driven by losses from stake sale in its Turkish asset.
In the year-ago period, the Vikram Pandit-led entity had a net income of USD 3.34 billion.
Citi incurred a USD 424 million loss in the second quarter related to sale of a 10 percent stake in Akbank TAS of Turkey.
On the other hand, the banking major recorded an accounting gain of USD 219 million as it reduced the reserve for bad loans by USD 984 million.
The bank's revenues fell to USD 18.64 billion in the quarter under review from USD 20.62 billion in the second quarter of 2011, thus registering a drop of 10 percent.
Citi's attributed the decline in revenues to the ongoing wind down of Citi Holdings, which the US-based bank created to handle toxic assets.
Revenues from Citi Holdings plunged by 62 percent from last year, while Citicorp's revenues were unchanged at USD 17.8 billion from the year-ago period.
"Our core businesses performed well in a difficult environment and are generating solid returns. We had strong growth in both loans and deposits, showed resilience in our markets-facing businesses, and saw record revenues in Transaction Services," Citigroup CEO Vikram Pandit said.
"We reduced Citi Holdings to approximately 10 percent of our balance sheet while our capital strength and liquidity continue to be among the best in the industry. We remain focused on execution, managing our expenses and our risk, and serving clients as only we can," he added.
Citi's capital market operations -- transaction services -- posted a net income of USD 910 million in the April-June quarter as compared to USD 859 million in the year-a go period. It has generated revenues of USD 2.8 billion, up 5 percent from the prior year period.
Revenues in Citi's consumer business remained almost flat from a year earlier, at USD 9.8 billion.
Net income in consumer businesses fell slightly from USD 2 billion a year earlier to USD 1.99 billion in the second quarter of 2012.
In securities and banking division, Citi's net income grew by 18 percent to USD 1.4 billion, while revenues rose by one percent from the prior year period to USD 5.4 billion.
At its Citicorp unit, regions such as Latin America and Asia were the major source of the bank's consumer areas.
The company said it had strong growth in corporate loans.
At Citicorp, consumer loans increased 2 percent to USD 284 billion and corporate loans surged 22 percent to USD 243 billion.