Citigroup Inc. turned a profit for the sixth straight quarter as losses from failed loans declined.
The New York bank says losses from bad loans fell 35 percent during the quarter to $5.4 billion. That allowed the bank to release $2 billion from its loan loss reserves and count it as income.
Net income rose 24 percent to $3.3 billion, or $1.09 cents per share, on revenue of $20.6 billion. That compares to net income of $2.7 billion, or 90 cents per share, during the same quarter last year. The earnings per share was adjusted to account for a reverse split, where 10 Citi shares were exchanged for one this May.
Analysts surveyed by FactSet had predicted Citigroup would earn 96 cents per share.
More of the bank's credit card and mortgage loan customers also paid on time --consumer loans that were delinquent by 90 days or more totaled $9.9 billion, down 46 percent compared with the same period last year. The bank also experienced growth in its lending business. Consumer loans increased 11 percent to $244 billion. Corporate loans grew 22 percent to $197 billion compared to last year. Much of the growth came from emerging markets, the bank said.
"We produced growth in both loans and deposits in Citicorp," said CEO Vikram Pandit.
Its investment banking income fell 29 percent to $1.2 billion as did revenue by 8 percent to $5.5 billion. Much of the decline came from an 18 percent drop from fixed income trading.
Citigroup was one of the hardest-hit banks during the financial crisis of 2008. The bank received $45 billion in government aid, $25 billion of which was converted to stock. Pandit has been trying to grow profits ever since the company emerged from government ownership last December.
However, to do that Citigroup has relied more heavily than other banks on money being released from reserves.
Shares of Citi are up over 2 percent at $39.90 in premarket trading.
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