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Citigroup profits hit the investment banking boost of Reuters

© Reuters. FILE PHOTO: Corbat, CEO of Citigroup gestures during a panel discussion at the Swiss American Chamber of Commerce in Zurich

By Imani Moise and Siddharth Cavale

(Reuters) – Citigroup Inc (NYSE:) Reported More than expected earnings on Monday, despite reduced revenue, as the key figures that led to lending by New York, increased investment and bank revenues and increased net interest rates.

Nevertheless, Citi improved its results in various ways, including cost cutting, which may be difficult to replicate in future quarters. A lower tax rate also played a major role in Citis's improvement from a year ago.

The bank's income from continuing operations actually decreased slightly. But the net result increased because its effective tax rate fell to 21

percent from 24 percent the year before.

Citi has invested in digital capabilities to try to win home deposits despite its light US branch network. CEO Mike Corbat said in a statement that its efforts are showing positive early results.

But the bank is still growing overseas faster except in the US: International consumer income increased by 3 percent during the quarter, while retail in North America increased by 1 percent.

JPMorgan Chase & Co (NYSE 🙂 on Friday reported that US consumer income increased by 3 percent over the previous year.

Corbat also pointed to the bank's improved 11.9 percent return on average, significantly common equity capital and the fact that it returned $ 5.1 billion in capital to shareholders over a quarter.

"Both our consumer and institutional operations worked well and we saw good speed in the areas where we have invested," he says.

Investments in investment banks increased by 20 percent to $ 1.4 billion, as strong growth in advisory and investment-grade debt guarantees more than offsetting a reduction in share guarantees.

Bond trading rose 1 percent in sharp contrast to Goldman Sachs (NYSE 🙂 and JPMorgan, both of which reported decreasing.

But a 24 percent reduction in stock trading pushed Citi's total revenue, which dropped 2 percent to $ 18.58 billion, slightly below analyst estimates.

Revenue from the Consumer Bank, the Bank's largest business, was flat at $ 8.5 billion, due to weakness in Asia.

Earlier this year, the bank said it would earn $ 2 billion more in lending from lending operations than it did in 2018.

Total loans from the third largest US bank increased by 3 percent to $ 682.3 billion while deposits grew 5 percent to $ 1.03 billion, excluding currency fluctuations.

Citi's net interest margin, a close monitoring, increased 8 points to 2.72 percent in the quarter, while total operating expenses decreased by 3 percent to $ 10.58 billion

Net revenue increased to $ 4.71 billion or 1.87 US $ per share, for the first quarter ended March 31, from $ 4.62 billion or $ 1.68 per share the previous year.

Analysts were looking for a $ 1.80 earnings per share according to IBIN data from Refinitiv.

The shares in the company increased by 1.2 per cent in trade before the clock.

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