Citi disappoints market with low profit gain

 
Tim Wallace
Follow Tim
PROFITS more than doubled at Citigroup in the fourth quarter, the bank said yesterday, but the improvement was smaller than analysts expected.

Shares fell on the announcement that the group made $2.7bn (£1.7bn) in the final three months of 2013, even though the figure was well above the $1.2bn seen in the same period of 2012.

Revenues edged down one per cent to $17.8bn, while operating expenses plunged 13 per cent to $11.9bn.

Poor fixed income results dragged down securities and banking revenues by five per cent to $4.6bn.

But investment banking revenues rose three per cent to $1bn, largely because of a 73 per cent leap in equities underwriting.

Headcount slid three per cent to 251,000 while compensation dropped 12 per cent to $3.8bn.

Return on equity increased to 5.3 per cent, up from 2.5 per cent a year earlier.

And Citigroup’s Basel III tier one capital ratio came in at 10.5 per cent, up from 8.7 per cent in the final quarter of 2012. The bank’s shares fell 1.89 per cent.