Instant View: Citigroup net falls, investment bank weighs

NEW YORK (BestGrowthStock) – Citigroup Inc (C.N: ) posted a $2.7 billion quarterly profit, down 37 percent from the same quarter last year, hurt by lower revenue in its investment banking business.

The third-largest U.S. bank posted second quarter profit (Read more your timing to make a profit.) of 9 cents a share, compared with $4.28 billon, or 49 cents a share in the same quarter last year.

Analysts on average expected the bank to earn 5 cents a share before special items, according to Reuters Estimates.

Citigroup shares were down 0.1 percent in premarket electronic trading.

The following is reaction from industry analysts and investors:

MARSHALL FRONT, CHAIRMAN OF FRONT BARNETT ASSOCIATES

“The results really looked very similar to the results of JPMorgan, in the sense that both reports reflect a significant improvement in credit quality but little in the way of identifying how they’re going to go from that to revenue growth. Both companies show trading down, loans down, revenues down, and it was credit quality that came to the rescue in the quarter.

“Citicorp’s business is less dependent on the consumer, it’s much more of a global bank. We’ll be looking to get an even more clear picture of what global business conditions are like, and how they’ve affected Citicorp’s earnings and what they’re likely to be in the future.”

GARY TOWNSEND, PRESIDENT AND CEO, HILL-TOWNSEND CAPITAL

“Credit is improving and that is in my opinion the fundamental case for this bank and others because the better credit results will be a persistent contributor to profits going forward.

I think the real key is going to be how quickly they are going to be able to sell off Citi Holdings. If they can continue to sell off Citi Holdings and continue to grow their capital, Citigroup is going to be fine.”

(Reporting by Clare Baldwin and Maria Aspan)

Instant View: Citigroup net falls, investment bank weighs