Open

Coming up

Don't miss

Replay


LATEST SHOWS

MEDIAWATCH

UNRWA official breaks down over Gaza deaths

Read more

DEBATE

Argentina Defaults - Kirchner Cries Foul Over 'Vulture Funds' (part 2)

Read more

DEBATE

Argentina Defaults - Kirchner Cries Foul Over 'Vulture Funds'

Read more

MEDIAWATCH

Renault's women drivers ad deemed sexist

Read more

FOCUS

Constitution prohibits Aung San Suu Kyi to run for president

Read more

THE BUSINESS INTERVIEW

War and Markets, with Steen Jakobsen, Chief Economist at Saxo Bank

Read more

IN THE PAPERS

France commemorates a hero of the left

Read more

INSIDE THE AMERICAS

Diplomatic strain for John Kerry

Read more

IN THE PAPERS

Germany and Russia 'discuss secret Ukraine deal'

Read more

  • French Jews speak of growing fear in Paris amid Gaza conflict

    Read more

  • Interactive: France’s new plan to counter jihadism in Africa

    Read more

  • US condemns school shelling as Israel calls up 16,000 more reservists

    Read more

  • Video: Inside Hamas ‘terror’ tunnels in Gaza

    Read more

  • France remembers murdered socialist hero Jean Jaurès

    Read more

  • Sierra Leone declares state of emergency over spread of Ebola

    Read more

  • Investigators reach MH17 site amid 24-hour ceasefire

    Read more

  • Air France ground workers to strike on August 2

    Read more

  • Scores feared dead in India landslide

    Read more

  • Russia ordered to pay further €1.9 billion to Yukos shareholders

    Read more

  • Iraq's Christians: Nowhere to Run?

    Read more

  • Russia defiant as US, EU unveil 'phase three' sanctions

    Read more

  • US House votes to sue Obama for over-reaching his powers

    Read more

  • Argentina fails to reach deal with creditors

    Read more

Business

Citigroup returns to profit, and CEO thanks taxpayers for bailout

Text by News Wires

Latest update : 2010-04-20

After two years spent largely in the red, US banking giant Citigroup said that it had returned to profit, posting a profit of 4.4 billion dollars in the first quarter of 2010.

AFP - US banking giant Citigroup said Monday it had returned to profit after two years spent largely in the red, posting a profit of 4.4 billion dollars in the first quarter of this year.

Following on from blockbuster results reported by its rivals last week, the New York-based bank returned to the black after losing 7.6 billion dollars in the last quarter of 2009.

It was the firm's best quarterly result since mid-2007.

The company has struggled since the start of the financial crisis and required a government bailout of 45 billion dollars to stay afloat.

The beleaguered global bank lost 1.6 billion dollars in 2009, and a whopping 27.6 billion dollars in 2008, when the collapse of rival US investment bank Lehman Brothers propelled the worst financial crisis in decades.

Citigroup is the last of the major money-center banks operating in the shadow of a US government bailout of financial institutions whose foundations were shaken by the crisis arising from a home mortgage meltdown.

Chief Executive Vikram Pandit said the company had now turned a corner.

"Citi today is fundamentally a very different company from what it was only two years ago," he said.

"All of us at Citi recognize that we would not be where we are without the assistance of American taxpayers, said Pandit.

"We owe taxpayers a huge debt of gratitude for assisting us at a critical time. We are determined to repay this debt by continuing to build a strong company and contribute to America's economic recovery."

The bank, once the world's largest, saw revenue increase by 7.5 billion dollars in the first quarter to 25.4 billion dollars, but that figure is still significantly down on last year.

In another sign that Citi's core business may be stabilizing, it said provisions for bad loans declined by 2.4 billion versus the last quarter.

Analysts said that could be a sign of further good news to come.

"Delinquencies have stabilized or improved across most categories, suggesting further reductions in loss provisioning," said Matthew Albrecht at Standard & Poor's.

At the height of the crisis, Citi's balance sheet had been awash with sour mortgage-based investments that lost the firm at least 30 billion dollars and prompted the massive taxpayer bailout.

Despite last quarter's encouraging 58 percent increase in US-based revenues, Pandit sounded a note of caution.

"We are proud of our first quarter results but remain cautious about the environment, given the uncertain economic recovery and high unemployment in the US," he said.

"Realistically, we do not expect our performance to follow an invariable trend-line upward."

That cautionary message did not dissuade investors, who sent the company's stocks up over six percent in early trading.

But the share price remains a long way off its highs.

Citi stock had traded for around 55 dollars a share before the crisis hit, compared to 4.80 dollars today.

Date created : 2010-04-20

  • BANKING

    US watchdog charges Goldman Sachs with fraud

    Read more

  • BANKING

    JPMorgan sets high target for US banks

    Read more

COMMENT(S)