U.S. News

Citigroup First-Quarter Profit Beats Expectations

The Citibank logo is shown on a branch office Wednesday, April 11, 2007 in New York. Citigroup Inc., which includes Citibank, announced Wednesday that it will eliminate about 17,000 jobs as part of a companywide restructuring to reduce costs and improve profits. (AP Photo/Mark Lennihan)
Mark Lennihan

Financial services heavyweight Citigroup, said Monday its first-quarter operating earnings topped market expectations, thanks to strength in its markets and investment banking businesses.

Dow component Citigroup reported earnings of $5.88 billion, excluding a one-time charge, or $1.18 a share, for the first quarter, up from earnings of $5.6 billion, or $1.11 a share, in the same quarter a year ago. Revenues rose 15% from the year-ago period to $25.5 billion.

Analysts surveyed by Thomson Financial predicted earnings of $1.09 a share on revenues of $25.5 billion.

Citigroup announced last week it will cut about 17,000 jobs in an attempt to save costs and catch up to rivals in terms of IT systems and other new initiatives. The move is expected to save Citigroup more than $10 billion over the next three years.

"We achieved these results while completing our structural expense review, which will help us become a leaner, more efficient organization and lower our rate of expense growth,” said Charles Prince, chairman and chief executive officer of Citigroup.

In its home U.S. market, Citigroup saw net credit losses increase by $164 million and a net charge of $182 million to increase loan loss reserves, reflecting the recent weakness in U.S. subprime mortgage sector.