Citigroup reports Q3 net income of US$2.2 billion

JAKARTA: Citigroup Inc yesterday reported third quarter 2010 net income of US$2.2 billion or US$0.07 per diluted share, marking its third consecutive quarterly operating profit.

Citigroup income from continuing operations, which excludes an US$800 million pre-tax, or US$435 million after-tax, loss on the previously-announced sale of The Student Loan Corporation (SLC), was US$2.6 billion or US$0.08 per diluted share in the third quarter 2010.

In the first nine months of 2010, Citigroup earned US$9.3 billion of net income and US$9.6 billion of income from continuing operations, according to the press release posted in the Citigroup’s official website.

"Achieving our third straight quarter of positive operating earnings is continued evidence that we are successfully executing our strategy and we believe we have put in place all the elements for continued profitability,” said CEO of Citi Vikram Pandit.
Meanwhile, the company’s net income was down US$529 million or 20% from the second quarter 2010, mainly driven by the loss on the previously-announced sale of SLC, as well as securities and banking, which declined 17%.

Regional Consumer Banking net income of US$1.2 billion increased 5% from the prior quarter, driven by Latin America and North America.

Besides, transaction services net income of US$920 million was down 1% from the prior quarter, reflecting consistent strength in the business, despite a low rate environment, and continued investments, as growth in Latin America and Asia was offset by declines in North America and EMEA (Europe, Middle East, and Africa).

Third quarter 2010 revenues of US$20.7 billion declined by US$1.3 billion or 6% from the second quarter 2010, primarily led by local consumer lending and securities and banking services.
Citicorp in Latin America and Asia revenues were up 7% and 1% respectively, from the prior quarter, while North America and EMEA revenues declined 6% and 2%, respectively.

Provisions for credit losses and for benefits and claims declined as high as US$746 million sequentially to US$5.9 billion, the lowest level since the second quarter of 2007 reflecting continued improvement in credit quality.

Citi also posted a decrease of expenses as much as US$346 million or down 3% to US$11.5, from the prior quarter. Excluding the impact of the UK bonus tax in the second quarter 2010, expenses increased by US$58 million or up 1%, representing continued investment spending in Citicorp, partially offset by lower Citi Holdings expenses.

During the quarter, Citi continued to focus on growing its core businesses in Citicorp, while divesting assets in Citi Holdings in an economically rational manner. Expressed on a pro forma basis for the previously-announced sale of SLC, Citi Holdings represented 20% of Citi\'s assets at the end of the third quarter 2010, as compared to 38% in the first quarter 2008.

"Overall, I am very pleased with the progress we are making as our team executes our strategy. Our unique footprint and strong presence in the emerging markets have us well aligned for the growth trends we see globally, and we continue to make investments in our franchise so we can serve our clients at the highest level all over the world," concluded Pandit. (T03/NOM)