The nation's third-largest bank, Citigroup, said today that profit fell 2.3 percent while trading revenue rebounded from the fourth quarter.
First-quarter net income was $2.93 billion, or 95 cents a share, compared with $3 billion, or $1 a share, in the same period last year. Profits were hurt by an accounting charge of $1.3 billion as the value of its debt increased.
Transaction Services revenues, however, were $2.7 billion, up 7 percent from the prior year period. Results reflected an 11 percent year-over-year growth in Treasury and Trade Solutions (TTS) revenues to $2.1 billion. TTS revenue growth reflected strong growth in average assets, particularly in trade finance.
Ironically, the trading rebound occurred just as Citigroup planned to remove more than 1,000 trading and investment-banking jobs. Recruiters say they do not expect the rebound to impact Citi's planned layoffs.
Investment banking revenue gained 2 percent to $865 million thanks to a 19 percent rise in debtunderwriting that canceled out a 25 percent slump in equity underwriting.
Citigroup CEO Vikram Pandit said the bank had "positive operating leverage across all three of Citi’s core businesses. Global Consumer Banking, our largest business, produced another quarter of good growth in revenues, net income and key drivers like loans and deposits. Transaction Services had record quarterly revenues as it captured increasing share in global trade finance and Securities and Banking rebounded strongly with year-over-year revenue growth."