Citigroup income drops 10%
By Stephen Bernard |
July 17, 2010, Saturday
|
Print Edition
Print Edition
CITIGROUP yesterday said its second-quarter net income dropped 10 percent to US$2.7 billion even as its losses from failed loans fell.
Citigroup Inc joins JPMorgan Chase & Co and Bank of America in reporting earnings that rose in the April-June period as loan losses fell. That's a positive sign for the economy, because it indicates that consumers are having an easier time paying their debts. But Citigroup, like the other banks, also had a decline in trading revenue because of the stock market's plunge this spring.
Citigroup was among the hardest hit banks by the financial crisis of 2008, and it was further hurt as many customers fell behind in loan payments during the recession. The bank's losses from failed loans fell 31 percent to US$7.96 billion during the April-June period from US$11.47 billion a year ago.
Despite the improving trend, CEO Vikram Pandit remained cautious about future growth, saying in a statement that "economic conditions remain challenging."
Like JPMorgan, Citigroup also removed some money from its reserves for future loan losses, which helps boost earnings.
It's also an indication that the bank is becoming more confident that the worst of the defaults is over and that delinquency and default levels are likely to shrink in the coming quarters.
Citigroup Inc joins JPMorgan Chase & Co and Bank of America in reporting earnings that rose in the April-June period as loan losses fell. That's a positive sign for the economy, because it indicates that consumers are having an easier time paying their debts. But Citigroup, like the other banks, also had a decline in trading revenue because of the stock market's plunge this spring.
Citigroup was among the hardest hit banks by the financial crisis of 2008, and it was further hurt as many customers fell behind in loan payments during the recession. The bank's losses from failed loans fell 31 percent to US$7.96 billion during the April-June period from US$11.47 billion a year ago.
Despite the improving trend, CEO Vikram Pandit remained cautious about future growth, saying in a statement that "economic conditions remain challenging."
Like JPMorgan, Citigroup also removed some money from its reserves for future loan losses, which helps boost earnings.
It's also an indication that the bank is becoming more confident that the worst of the defaults is over and that delinquency and default levels are likely to shrink in the coming quarters.
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