Updated from 7:43 a.m. EST
first-quarter earnings edged up 3% from a year ago and the company authorized up to $15 billion in additional share buybacks.
The world's largest financial institution earned $5.44 billion, or $1.04 a share, in the quarter, compared with earnings of $5.27 billion, or $1.01 a share, last year. On a continuing operations basis, earnings rose 3% from a year ago to $5.17 billion, or 99 cents a share.
Analysts were calling for earnings of $1.02 a share in the latest quarter, according to Thomson Financial. Citigroup's bottom line included a slew of special items -- a $272 million restructuring charge, a $109 million loss on the sale of manufactured housing loans, a $111 million gain on the sale of a transportation finance business and a $72 million gain from a litigation settlement -- the complicated the comparison to Wall Street forecasts.
Citigroup's overall revenue rose 6% from last year to $21.53 billion, a number that excluded Citigroup's discontinued Traveler's subsidiary. The Thomson consensus estimate on revenues was $22.73 billion. Bank officials said total revenue exceeded analyst expectations if the $1.4 billion from Travelers is added back.
"We had a great quarter,'' said Citigroup CEO Charles Prince, during a conference call.
Prince noted that the bank had strong revenue growth in many of its divisions. He said the earnings gains in the quarter did not come from the release of loan loss reserves, something that had boosted the bank's earnings in the fourth quarter of 2004 and was criticized by analysts and investors.
But it was the bank's consumer operation that salvaged the quarter. Strong consumer spending and borrowing made up for a surprisingly disappointing performance in Citigroup's big corporate lending and investment banking operation.
In other bank news Friday, earnings at
, a big East Coast lender, rose 30% compared to a year ago, as the Charlotte, N.C.-based bank met analyst expectations. Wachovia earned $1.62 billion, or $1.01 a share, compared to $1.25 billion, or 94 cents a share, a year ago.
Meanwhile, Midwestern lender
reported a 6% first quarter gain in earnings, as the Cleveland-based bank exceeded analyst expectations and raised earnings estimates for the rest of the year. The bank earned $264 million, or 64 cents a share, compared with $250 million, or 59 cents a share. Analysts had predicted earnings of 61 cents a share.
For the full year, KeyCorp said it now expects to earn between $2.55 and $2.65 a share. Before the earnings report, analysts had predicted 2005 earnings of $2.57 a share.
Given that Citigroup is a
, investors are expected to pay keen attention to its earnings Friday.
By segment, revenue in Citi's global consumer division rose 4% from a year ago to $12.05 billion while profit in the division rose 9% to $2.82 billion. In corporate and investment banking, revenue rose 10% from a year ago to $6.03 billion while profit fell 2% to $1.68 billion. In global wealth management, revenue fell 6% from a year ago to $2.12 billion while profit slid 23% to $317 million. And in asset management, revenue fell 10% to $413 million while profit tanked 25% to $79 million.
"As we have seen in prior quarters, weakness in certain products or regions was more than offset by strength in others," Citigroup said. "We achieved strong growth in customer balances, which helped to offset the impact of spread compression from rising short-term rates. Our fixed income and transaction services businesses performed exceptionally well, both achieving record revenues."
On the consumer side, the Citigroup division posting the strongest numbers was the bank's 'North American retail banking unit, where revenue shot up 14% to $3.3 billion and profits jumped 22% to $935 million. The company also did well in bond and commodity trading, which helped drive an 8% jump in capital markets and banking revenue to $4.90 billion.