Citigroup’s quarterly profit falls 14 percent, less than indicated

Mr. Corbat has said the battered stock price is partly due to unfair perceptions of emerging markets, where Citigroup has a big presence, and to the bank’s history as a problem child during the financial crisis.

Citigroup reports quarterly earnings and revenue that easily beat analysts’ expectations. However, it beat the $1.10 that analysts were expecting from the company.

Citigroup’s second-quarter net income dropped to $4 billion, or $1.24 a share, from $4.85 billion, or $1.51, a year earlier, the company said Friday in a statement.

Citigroup’s second-quarter net income dropped to $US4 billion, or $US1.24 a share, from $US4.85 billion, or $US1.51, a year earlier. In the past six quarters, the bank only had one revenue gain.

Earnings season for the banking industry has commenced as big U.S. banks led the season, revealing their second quarter of fiscal year 2016 (2QFY16) financial results. But Wall Street is now uncertain there will be any rate hikes in 2016, especially after Britain’s shock vote to leave the European Union.

Citigroup executives expressed confidence in their overall strategy, which includes doing business around the world and focusing the consumer bank on wealthier customers in big cities. The bank said expenses fell 5 percent to $10.4 billion from $10.93 billion a year earlier.

Citi’s consumer banking business had net income of $843 million, down 22 percent from a year ago, as Citi continued to shrink its operations in the US and overseas.

Still, the Brexit vote killed the banks’ hopes the Federal Reserve might raise USA interest rates this year, and the superlow rates continue to pressure bank earnings.

The bank said its operating expenses fell 5 percent to $10.4 billion, citing lower expenses from Citi Holdings and “a benefit from foreign exchange translation”.

Citi Holdings revenue tumbled 57% to $843 billion as it continues to shed assets. Its total non-accrual assets of $6.3 billion dipped 6 percent whereas consumer non-accrual loans dropped 30 percent to $3.7 billion. Citi said it has plans to sell off an additional $7 billion in assets.

Citi Holdings, the portfolio of unwanted assets tagged for sale, was profitable for the eighth consecutive quarter, booking a $93 million profit.

Considering the better credit environment in the second quarter of this year, Citigroup, similar to other banks, saw declining cost of credit.

Shares traded up about 0.9% in the premarket Friday morning at $44.85, having closed on Thursday at $44.45. Those estimates had been falling since the start of the year and declined further in the wake of the U.K.’s late-June Brexit vote that sent long-term bond yields to new historic lows.