This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Citigroup Earns Profit as 'Derisked' Bank (Update2)

"Citi continues to navigate a challenging economic environment and delivered another quarter of solid operating results," Vikram Pandit, Citi's Chief Executive Officer, said in a statement. "We continued to manage our risk prudently while growing the businesses that are core to our strategy."

The bank, however, saw continued strength in its emerging markets . The regional consumer banking business saw revenue growth of 2% to $8.3 billion over the previous year. Revenue growth of 10% in international businesses was offset by a 9% decline in North America.

Loan growth was strong, with end-of-period loans at Citicorp, which houses the core businesses, increasing 13% on a year-on-year basis. Loans increased by nearly 1% on a sequential basis. On a constant currency basis, loans grew 4% sequentially.

Operating expenses increased 8% from the prior year period to $12.5 billion, reflecting higher expenses from the impact of foreign exchange translation, higher legal and related expenses and ongoing investment spending. However, the bank pointed out that its investments in Asia achieved operating leverage in the third quarter, ahead of schedule and that its investments in Latin America will start paying off in the fourth quarter.

Citigroup's bad bank, Citi Holdings , saw a reduction of $132 billion in assets, with revenues declining 27% to $2.8 billion from the prior year period. The bank said that it had decided to retain its retail partner cards business in its core portfolio after it reported significant strength. "Over the past few years we have significantly strengthened our retail partner cards business and it has earned $2.2 billion pre-tax through the first three quarters. After a careful review of the business, which took into account current trends in credit and technology, we have decided that it makes strategic sense to move retail partner cards and a vast majority of its assets from Citi Holdings into Citicorp. The transition will be completed by the end of this year," the bank said.

In a media call, CFO John Gerspach said OneMain, the bank's other credit card portfolio, will likely remain in Citi Holdings as it was not core to its strategy. He said the pace of asset sales in Citi Holdings will moderate as the bank will likely face challenges in selling its mortgage portfolio under the bad bank.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
C $52.41 0.00%
AAPL $130.42 0.00%
FB $80.41 0.00%
GOOG $555.48 0.00%
YHOO $44.45 0.00%

Markets

DOW 18,214.42 -10.15 -0.06%
S&P 500 2,110.74 -3.12 -0.15%
NASDAQ 4,987.89 +20.7530 0.42%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs