Enterprise Television– Citigroup Profit Beats on Consumer Banking Strength
Citigroup Inc’s quarterly profit topped Wall Street estimates on Friday, helped by strength in its consumer banking business in Mexico, North America and Asia.
The third-largest US bank by assets, like its peers, also benefited from a cut in income tax rates and an expanding US economy that fueled demand for loans.
Net income rose to $4.49 billion in the second quarter ended June 30, from $3.87 billion a year earlier, driven by a 14% jump in net income for its global consumer banking.
Pretax profit from continuing operations increased 5%.
Earnings per share rose to $1.63 from $1.28 and topped analysts’ average estimate of $1.56, according to Thomson Reuters I/B/E/S.
The bank’s provision for income tax fell by $351 million, following President Donald Trump’s corporate tax rate cuts.
Buybacks reduced shares outstanding by 8% from a year earlier, further boosting earnings per share.
Revenue rose about 2 percent to $18.47 billion but came in slightly below the average expectation of $18.51 billion as revenue from its investment banking business fell 7%.
The bank’s fixed income trading revenue fell 6%, while equity trading revenue rose 19%. Total markets and securities services revenue fell 1%.
Last month, Chief Financial Officer, John Gerspach said he expected trading revenue to be “flattish” compared with a year earlier.
Through Thursday, Citigroup shares are down 7.9% for the year, compared with the 1% drop in the broader KBW Bank Index.
JPMorgan Chase & Co’s quarterly profit topped Wall Street’s expectations on Friday, as trading revenue came in much higher than expected and demand for loans increased on the back of a strengthening US economy.