(22 April 2009 – USA) Citi has produced a first quarter profit in 2009 of US$1.6 billion (A$2.2 billion), leaving a disastrous 2008 behind it.The first quarter profit is a substantial turnaround and a fresh start for a newly restructured Citi. Last year, losses at Citi totalled US$27.7 billion, including an enormous US$17.3 billion in the final quarter.
While worldwide operations have turned a profit, losses are still the norm in North America, albeit not to the extent of last quarter. In its primary region, the big loser last year, Citi recorded a loss of US$1.3 billion.
Citi’s global presence helped the company turn into profit to start the year. Profits were made in the three other major divisions; EMEA (Europe, Middle East and Africa) at US$1.8 billion, Latin America (US$1.2 billion), and Asia (US$645 million).
Globally, revenues of US$24.8 billion were driven by strong results in the Institutional Clients Group, partially offset by net write-downs. Results also include US$7.3 billion in net credit losses and a US$2.7 billion net loan loss reserve build.
Profit of US$2.8 billion in the Institutional Clients Group offset the worst performing business unit, Consumer Banking, which still incurred losses of US$1.2 billion.
The results for each unit do, however, represent large turnarounds from losses in the fourth quarter of 2008 of US$9.7 billion and US$10.4 billion respectively.
With revenue of nearly US$25 billion and net income of $1.6 billion, Citi had its best overall quarter since the second quarter of 2007, said Vikram Pandit, Chief Executive Officer of Citi.
Operating expenses were down US$3.7 billion, or 23 percent, since the first quarter 2008, partly due to a reduced headcount of approximately 13,000 since the fourth quarter 2008 to 309,000 and approximately 65,000 since peak levels.