Citigroup's earnings surge 36 percent, beating estimates

AP News
|
Posted: Oct 15, 2015 11:08 AM
Citigroup's earnings surge 36 percent, beating estimates

NEW YORK (AP) — Citigroup said Thursday its earnings jumped 36 percent in the third quarter as the bank continued to cut expenses and clean up its books in the wake of the financial crisis.

The New York-based bank earned $3.99 billion, or $1.31 per share, excluding payments to preferred shareholders and an accounting adjustment, for the three-month period ending in September. That compares with earnings of $2.94 billion, or 95 cents a share, in the same period a year earlier.

Citi's latest earnings beat analysts' estimates of $1.27 a share, according to FactSet.

Citi has been on a multi-year mission to recover from its near collapse during the financial crisis, and 2015 has been a year of significant progress.

Citi Holdings, the firm's so-called "bad bank" where it stores all its troubled assets, made a profit for the fifth straight quarter. The firm passed the Federal Reserve's "stress tests" earlier this year and legal expenses this quarter were $376 billion, down from $1.6 billion a year earlier.

"I feel good about the quality and consistency of our earnings over the course of this year, as we have continued to make solid progress against our core priorities," Michael Corbat, CEO of Citigroup, said in a statement.

Most of Citi's major businesses saw revenue declines this quarter, but those were mostly offset by lower expenses. Overall expenses fell 18 percent to $10.67 billion from $12.96 billion a year earlier, mostly because legal costs fell sharply.

Citicorp, the bank's consumer and corporate banking division, had net income of $4.26 billion in the period excluding an accounting adjustment, up from $2.82 billion a year earlier.

Overall, Citi's revenue was $18.5 billion after the accounting adjustment, compared with $20.06 billion the year before. That was in line with analysts' estimates.

Citigroup's stock rose $1.38, or 2.7 percent, to $52.10 in late-morning trading.