Published: Fri, October 13, 2017
Economy | By Annette Adams

Investment banking gains drives Citi's quarterly results

Investment banking gains drives Citi's quarterly results

JPMorgan on October 12 reported third-quarter net income available to common shareholders of $6.3 billion. The results beat analysts' expectations, who were looking for $1.32 per share, according to FactSet.

Quarterly consumer banking revenue increased 3% globally from a year ago, to $8.43 billion, led by a 10% gain in Mexico.

Revenue of $25.3 billion was in line with the consensus estimate.

On average, 20 analysts polled by Thomson Reuters expected the company to report earnings of $1.32 per share.

"The results were solid but not exceptional", said Morningstar analyst Jim Sinegal. The Labor Department said USA producer prices rose 0.4 percent last month and 2.6 percent in the 12 months through September.

Growth in credit cards, auto loans, commercial banking and corporate advisory fees drove the results, with average core loans up 7 percent during the quarter.

Revenues from Institutional Clients Group rose 9 percent to $9.23 billion, reflecting a 16 percent increase in banking revenue and 3 percent growth in markets and securities services.

Wall Street banks have been grappling with bond market challenges for most of the past seven years, as client volumes have been depressed for a number of reasons and new regulations have restricted certain activities and made trading more expensive. (C) on Thursday reported an 8 percent increase in profit for the third quarter from a year ago, reflecting higher revenues and lower expenses that more than offset higher cost of credit.

While Citi's trading desks focus heavily on bond and currency trading, it was the bank's other trading desks that stood out. Citi's drop in bond trading revenue is similar to what JPMorgan Chase reported on Thursday as well.

Like its peers on Wall Street, Citigroup was expecting another tough quarter for trading revenue amid tepid volatility.

Bruce McCain, chief investment strategist at Key Private Bank, said this earnings season is off to a good start.

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