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Updated from 8:14 a.m. (EDT)

Citigroup

(C) - Get Citigroup Inc. Report

, the New York-based financial-services behemoth, reported a 23% decline in third-quarter profit and flat revenue.

In the quarter, the nation's biggest bank earned $5.5 billion, or $1.10 a share, compared to $7.14 billion, or $1.38 a share, in the year-ago period. Total revenue was down a hair from a year ago to $21.42 billion.

The quarter included a $237 million tax benefit stemming from the resolution of a tax dispute.

The year-ago quarter included the proceeds from the sale of its former Travelers life insurance business. Excluding that sale and other costs in the just completed quarter, profit from continuing operations rose 6% to $5.3 billion, or $1.06 a share.

On that basis, Citigroup exceeded the Thomson Financial consensus estimate of $1.03 a share by three cents. But revenue came in slightly below the target estimate of $21.63 billion.

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The quarter was another mixed one for Citigroup. International consumer banking performed well, but the domestic-side operaton was weak. More disturbing, Citigroup's investment bank posted particularly weak numbers. The lackluster performance at Citigroup's investment bank is similar to the ho-hum investment banking performance seen at

Merrill Lynch

(MER)

earlier this week.

The big earnings driver at Citigroup was its global consumer banking group, which posted a 17% gain in net income to $3.19 billion. But the lender's big corporate and investment banking group put up woeful numbers, posting a 4% decline in net income to $1.72 billion.

Revenue growth was weak at Citigroup's domestic consumer banking operation, rising just 1% from a year ago to $7.8 billion. But that weakness was offset by strength in its international retail banking operation, which generated $5 billion in revenue, a gain of 9%.

The firm's investment banking and corporate group posted a 6% decline in revenue to $6 billion. Fees from stock underwriting were particularly weak. But some of that was offset by higher fees from merger advisory work and bond underwriting.

Transaction services, which includes trading, posted an impressive 20% gain in revenue to $1.5 billion.