(Citigroup international story updated with Europe disclosures, management commentary)
The bank said net income rose to $3.8 billion or $1.23 per share in the third quarter compared to $2.2 billion or 72 cents per share in the year-ago period.Revenues came in at $20.8 billion, up slightly from the year-ago quarter. Excluding the one-time gain from falling value of its own debt, Citigroup reported an earnings per share of 84 cents on revenues of $18.9 billion.
Citigroup has been among the few banks that has shown strong loan growth in an anemic recovery, thanks to its strong presence in Asia and Latin America. That trend continued well into the third quarter, despite concerns that high inflation and macro-economic uncertainties in Europe and U.S. will crimp growth in emerging markets.International consumer banking revenues in Latin America, Asia and EMEA(Europe, Middle East and Africa) gained 10% to $4.9 billion, from $4.42 billion in the year-ago quarter. The bank also reported strong double-digit growth in loans, thanks largely to the performance of its international consumer banking operations. End of period loans at Citicorp, the unit which houses its core businesses, grew by 13% to $444 billion. Latin America and Asia each saw double digit growth year-over-year in average loans, average deposits and purchase sales. Sandler O'Neill analysts expected international loans to grow by 3%. Overall, consumer loans expanded by 6% to $237 billion, while corporate loans surged 21% to $207 billion over the prior year period. Still, international profit growth lagged that of revenues, with the bank remaining in investment mode in emerging markets. Net income from international consumer banking operations declined 12% to $919 million. Operating expenses increased 12% to $2.9 billion, reflecting ongoing investments and the impact of foreign exchange movements and higher business volumes. The bank said that the international business in Asia achieved operating leverage one quarter ahead of schedule, with revenues outpacing expenses. Citi's Latin American business remains on track to start paying off in the fourth quarter of 2008. Profits also declined due to lower releases of reserves of $9 million, down from $440 million in the third quarter of 2010 as credit trends normalize in Asia and other emerging markets. Net credit losses declined 9% to $691 million. "Overall credit quality in international RCB[regional consumer banking] continued to improve as delinquencies in both cards and retail banking were lower across all buckets even as the underlying loan portfolios grew at double digit rates versus the third quarter 2010," the bank said. "We feel very good about the underlying credit in both regions," said CFO John Gerspach said in a conference call with reporters.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV