REUTERS: Citigroup Inc beat analysts' estimates for quarterly revenue and profit on Tuesday, as growth in its consumer banking business tempered weakness in trading.
Citi, the most global of the U.S. banks, said revenue in its consumer unit rose 4per cent excluding the impact of currency fluctuations, outpacing its institutional clients business where revenue grew 3per cent.
Consumer business was padded by more U.S. credit card customers beginning to pay interest as promotional periods wore off. North America branded card revenue jumped 11per cent in the third quarter. Expenses in the consumer business fell 2per cent.
Trading revenue fell 1per cent as a decline in equities offset stable revenue in fixed-income trading. JPMorgan Chase & Co and Goldman Sachs Group Inc both reported a rise in revenue from bond trading.
Citi also reached a key efficiency target. The third-largest U.S. bank by assets hit a return on tangible common equity (ROTCE) of 12.2per cent, above the goal of 12per cent it has promised investors for the year.
ROTCE is a widely watched measure of how well a bank uses shareholder money to generate profits.
Citi has been focused on building credibility with investors after missing targets in recent years. Estimates often hovered below the bank's stated goals, indicating Wall Street analysts were skeptical management could reach the targets it had set.
Net income applicable to the bank rose 6per cent to US$4.9 billion, or US$2.07 per share, in the third quarter from US$4.6 billion, or US$1.73 per share, a year earlier.
Excluding a tax benefit, the bank earned US$1.97 per share.
Revenue was up about 1per cent at US$18.57 billion.
Analysts were expecting a profit of US$1.95 per share and revenue of US$18.5 billion, according to IBES data from Refinitiv.
(Reporting by Sweta Singh in Bengaluru and Imani Moise in New York; Editing by Sriraj Kalluvila)