Hahaha! Making money or making loss??? Do you really really know FA?
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Citigroup reported a first-quarter loss that was narrower than analysts expected Friday and said its Tier 1 capital ratio improved dramatically compared with the same period of last year.
Citigroup's [C 3.65 -0.36 (-8.98%) ] loss per share was 18 cents in the first three months of the year, compared with a loss of $1.03 a share in the year-ago period.
On average analysts predicted a loss of 34 cents a share.
The bank's Tier 1 capital ratio was around 11.8 percent versus 7.7 percent in the first quarter 2008, Citigroup said in a statement.
Revenue rose 99 percent from the first quarter of 2008 to $24.8 billion, driven by strong results in the Institutional Clients Group, the bank said.
The company said income available to shareholders was lowered by 24 cents a share from the conversion price of the $12.5 billion convertible preferred stock issued in a private offering in January last year.
"This did not have an impact on net income but resulted in a reduction to income available to common shareholders of $1.3 billion or $0.24 per share. Without this reduction, earnings per share were positive," Citigroup said.
The results included $10.3 billion of credit costs, up 76 percent, with a large portion of the increase stemming from credit cards. This included $7.3 billion of net credit losses, a $2.7 billion increase to loss reserves, and $332 million for other benefits and claims.
Citigroup shares fell 6 percent after rising as much as 15 percent in pre-market trading.
Waiting for Stress Test Results
The bank also said it planned to delay the proposed exchange of billions of dollars of preferred shares into common stock until the U.S. government completes its "stress tests" of large banks to gauge which might need more capital or aid.
Despite topping analysts esitmates, some analysts were concerned about how the numbers reflect the bank's overall health and said the results must be thoroughly scrutinized.
Die Lor.. Hold Lor.. Hahaha!
Citigroup Credit Losses Rising Rapidly, Goldman Says (Update1)
By Nick Baker and Kelvin Wong
April 20 (Bloomberg) -- Citigroup Inc.’s credit losses are growing at a “rapid rate,” undermining Chief Executive Officer Vikram Pandit’s efforts to stabilize the U.S. bank, according to Goldman Sachs Group Inc.
While Citigroup posted first-quarter net income of $1.6 billion last week, the New York-based bank suffered an “underlying” loss of 38 cents a share, Richard Ramsden, a Goldman Sachs analyst, wrote in a research note dated yesterday. He repeated a “sell” rating on the stock.
Citigroup, which received $45 billion in government aid, ended a five-quarter losing streak on trading gains and an accounting benefit for companies in distress. The bank, which cut compensation costs and took fewer writedowns, still reported higher delinquencies on home and credit-card loans.
The results “included several one-time items which muddied the waters,” Ramsden wrote in the note. “The key question mark in our mind remains what Citi’s earnings power will be on the other side of the crisis.”
Citigroup fell to $3.54 in German trading today from $3.65 on April 17 in New York trading. The shares have dropped 46 percent this year, paring the bank’s market value to about $20.1 billion.
Ramsden halved his estimate for Citigroup’s 2009 loss to 25 cents per share, while keeping unchanged his forecast for 20 cents net income per share for 2010. He also introduced an estimate of 40 cents per share profit for 2011.
The analyst kept a 12-month price target for the stock of $1.50. Citigroup’s shares fell 36 cents, or 9 percent, to $3.65 on April 17, the day it announced first-quarter earnings. The decline brought the stock’s loss this year to 46 percent.
Fixed-Income Boom
Fourteen of 18 analysts covering Citigroup rate the stock the equivalent of a “sell” or a “hold,” according to data compiled by Bloomberg. The bank, once the world’s largest financial-services company by market value, now ranks as No. 70, Bloomberg data shows.
Citigroup had $4.69 billion of bond trading revenue in the quarter, as it benefited along with Goldman Sachs and JPMorgan Chase & Co. from the failure of Wall Street competitors and the government-led rescue of the financial system. Sales of U.S. corporate bonds surged to $438 billion this year, up more than 50 percent from a year earlier, according to Bloomberg data.
The fixed-income bonanza, along with wider net interest margins and gains from accounting changes, masked declines in credit-card and consumer banking revenue, and soaring costs to cover bad loans at its credit card unit.
Last Updated: April 20, 2009 04:28 EDT
