Citigroup second-quarter profit falls on losses from older assets

NEW YORK: Citigroup Inc
said second quarter profits dropped as it lost money on the sale of a
stake in a Turkish bank and suffered from the drag of its troubled
assets left over from the 2007-2008 credit crisis.
Net income
fell to $2.9 billion, or 95 cents per share, from $3.34 billion, or
$1.09 a share, in the same quarter a year earlier, the company said.
The
results included a $424 million loss from the sale of a 10.1 percent
stake in Akbank TAS of Turkey and a $219 million gain from changes in
the market value of its own debt and that of certain trading partners.
The company lost $920 million in Citi Holdings,
where it houses bad assets from the credit crisis, compared with a $661
million loss in the same quarter last year. The company said Citi
Holdings now contains 10 percent of total assets, down from 11 percent
three months ago.
Excluding the debt accounting adjustments and
the Turkish bank sale, earnings per share were $1.00 while net income
was 1 percent lower than a year earlier, the company said. Operating
expenses declined 6 percent.
Citigroup shares rose 3.4 percent to $27.55 in premarket trading.
"We
had strong growth in both loans and deposits, showed resilience in our
markets-facing businesses, and saw record revenues in Transaction
Services," Citigroup Chief Executive Vikram Pandit said in a statement.
Citigroup is the third largest U.S.-based bank by assets. - Reuters