Earnings Rise at Citigroup, Bank of America

But Citigroup misses its earnings number on a big Argentina charge.

Author:: TSC Staff
Publish date:: Apr 15, 2002 7:36 AM EDT

Citigroup's

first-quarter profits rose on strong consumer lending results but came in slightly below analysts' predictions because of a big charge related to the financial turmoil in Argentina.

Bank of America

(BAC) - Get Report

posted a similar increase and beat analyst views.

Excluding a gain related to the spinoff of its property and casualty insurance operations, Citigroup, the No. 1 U.S. financial services firm, earned $3.86 billion, or 74 cents a share, in the latest quarter, compared with $3.66 billion, or 71 cents a share, a year ago. The average analyst estimate compiled by First Call was for earnings of 78 cents a share in the latest quarter.

The results include a pretax charge of $816 million related to investment and currency writedowns in Argentina. Including a $1.06 billion gain related to the spinoff, the company earned $4.84 billion, or 93 cents a share.

Citigroup said income in its global consumer business rose 26% with an 11% rise in its global cards business. Profit at its investment and corporate banking units, however, dropped 4% in the quarter, as the company's dominant debt-underwriting operation failed to offset declines in trading and investment banking.

Meanwhile, Bank of America said favorable lending spreads boosted earnings to $2.18 billion, or $1.38 a share, in the first quarter, compared with $1.87 billion, or $1.15 a share, in the year-ago quarter. Analysts on average were expecting earnings of $1.34 a share.

Income in the bank's consumer and commercial banking unit was $1.42 billion, up 11% from a year ago, excluding goodwill amortization. Net interest income increased 13% to $3.51 billion, driven by both consumer loan and deposit growth. Average loans grew 4%, with consumer loans up 20%, primarily in residential first mortgage and credit card lending.