Citi posts higher income as troubled assets perform better
By David Henry and Tanya Agrawal
(Reuters) - Citigroup Inc posted better-than-expected quarterly income as losses on troubled assets narrowed, but revenue declined in many of its major businesses and operating expenses remained stubbornly high.
The biggest boon to Citigroup's first-quarter results came from Citi Holdings, the unit that houses the assets it's looking to shed. But echoing JPMorgan Chase & Co's results on Friday, Citigroup was hurt overall by a decline in revenue from bond trading and home mortgage lending.
Citigroup's Chief Financial Officer John Gerspach said he would not be surprised if bond trading revenue fell 5 to 10 percent for the industry this year.
As with JPMorgan, many of Citigroup's other major businesses posted double-digit percentage declines in revenue.
But Citigroup's results did beat analysts' average expectations, and shares rose 4.2 percent to $47.61, putting them on track to log their biggest one-day percentage gain since January 2013.
The stock gains came after the bank's shares lost some 9 percent since late March, when Citigroup failed to win Federal Reserve approval to pay a higher dividend and buy back more shares.
Citigroup Chief Executive Michael Corbat has been struggling to improve the bank's relationship with regulators, and the Fed's rejection was a stinging blow. Corbat said he expects to be held accountable for the rejection when the board of directors determines his pay.
The bank has given investors other bad news recently. Continued...