Citi Still Weighed Down by Credit Losses

Updates to add latest share price. An earlier version of this story incorrectly stated the company reported a net loss for the quarter.

NEW YORK (TheStreet) -- Citigroup(C) posted a slight profit for the third quarter but turned in a loss on a per share basis due to one-time items and dividend payouts.

The company said net income for the three months ended Sept. 30 was $101 million. On a per share basis, however, it lost 27 cents a share for the quarter, factoring in the impact of a preferred-to-common stock swap and the payment of preferred dividends.

The average estimate of analysts polled by Thomson Reuters was for a loss of 38 cents a share in the September period.

Revenue came in at $20.4 billion, slightly better than analysts were expecting.

The company said credit losses fell slightly to $8 billion for the quarter, including an addition of $802 million to its net loan loss reserves. Citi's loan loss provision was $3.9 billion in the second quarter.

Citi's total allowance for loan losses stood at $36.4 billion, or 5.9% of total loans, as of Sept. 30, up from $35.9 billion in the prior quarter, or 5.6% of total loans in the second quarter.

Total credit costs fell 28% on a sequential basis to $9.1 billion.

Citi completed a $58 billion preferred-to-common exchange during the third quarter. The exchange offer resulted in an $851 million after-tax gain, but also in a $3.1 billion reduction in income available to common shareholders, resulting in an incremental net loss of 18 cents a share. The reported loss per share also reflected the payment of $288 million in preferred stock dividends, which did not affect net income but reduced income available to common shareholders by 2 cents per share.

"This was an important quarter for us," CEO Vikram Pandit said in a release. "The completion of the exchange offers and the significant actions taken during the last few quarters have created a strong foundation. With strong capital, strong liquidity and a strong franchise, we are looking forward. We continue to execute steadily against our plan, and sustainable profitability remains our primary goal in the near term. While consumer credit trends are improving in international markets, the U.S. consumer credit environment remains challenging."

Citi's Tier 1 Capital ratio was 12.7% at the end of September while its Tier-1 Common ratio was 9.1%.