Citigroup Posts Record 3rd-Quarter Profit
Monday, October 20th 2003, 12:00 am
By: News On 6
NEW YORK (AP) _ Citigroup, the nation's largest financial institution, reported record profits of $4.7 billion for the third quarter, well above Wall Street expectations.
The New York City-based bank said Monday that all of its divisions except private client services registered double-digit earnings growth.
Third-quarter profits amounting to 90 cents a share compared with earnings of $3.92 billion, or 76 cents a share, in the July-September period a year earlier.
Analysts surveyed by Thomson First Call had projected earnings of 85 cents a share.
Many of the nation's banks have reported better-than-expected results this season because of improved investment banking business, the resurgent stock market and continuing strength in mortgage activity.
Chairman Sanford I. Weill said in a statement accompanying the report that earnings were boosted by ``the strengthening global economy'' as well as the bank's broad offering of services.
``Two-thirds of our businesses posted double-digit earnings increases,'' he said, noting that third-quarter earnings beat the previous high in this year's second quarter by nearly $400 million.
Revenue totaled $19.4 billion for the third quarter, up from $17.64 billion a year earlier.
Weill, who earlier this month turned the job of chief executive officer over to Charles O. Prince, said of the transfer: ``This is the right time to turn management over to Chuck Prince and Bob Willumstad, and I look forward to having them lead our company into the future.''
Robert B. Willumstad became president and chief operating officer on Oct. 1.
Citigroup said that during the third quarter, it completed its acquisition of the Home Depot credit card portfolio and received regulators' approval for the purchase of the Sears credit card business. The Sears deal is expected to close in November, Citigroup said.
``Following the acquisition, Citigroup will become the leading private label card issuer in the United States,'' the bank said.
Citigroup also continued to write down some of its holdings in Argentina, taking $95 million in after-tax charges in the third quarter.
It noted, however, that credit quality had improved overall and that the bank's provision for credit losses dropped 40 percent, to $1.61 billion from $2.69 billion.
Most of the bank's divisions reported double-digit earnings for the third quarter. Profits rose 14 percent to $2.52 billion in the global consumer group, 31 percent to $1.37 billion in the corporate and investment bank and 29 percent to $1.23 billion in Citigroup's international division.
Earnings in the private client services group increased 8 percent to $203 million.
Profits for the first nine months of the year totaled $13.09 billion, or $2.51 a share, up from $12.85 billion, or $2.47 a share in the same period of 2002. Last year's figures exclude earnings from Travelers Property Casualty Corp., with Citigroup sold off in March 2002.
For the first nine months, revenue was $57.29 billion, up from $53.44 billion in 2002.