Citigroup profit rises 16% on lower taxes and higher revenue

Citigroup reported a 16 per cent increase in quarterly profit on Friday, as the Wall Street bank benefited from lower taxes, higher fee income and strength in its consumer banking business in Mexico.

The third-largest US bank by assets said net income rose to $4.49 billion in the second quarter ended June 30th, from $3.87 billion a year earlier. Pre-tax profit from continuing operations increased 5 per cent.

Earnings per share rose to $1.63 from $1.28.

Analysts on average had expected earnings per share of $1.56, according to Thomson Reuters. It was not immediately clear if the numbers were comparable.

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The bank’s provision for income tax fell by $351 million, following US president Donald Trump’s corporate tax rate cuts.

Buybacks reduced shares outstanding by 8 per cent from a year earlier, further boosting earnings per share.

Revenue rose about 2 per cent to $18.47 billion. Analysts had estimated revenue of $18.51 billion.

Through Thursday, Citigroup shares are down 7.9 per cent for the year, compared with the 1 per cent drop in the broader KBW Bank Index.

JPMorgan Chase & Co’s quarterly profit topped Wall Street’s expectations on Friday, as trading revenue came in much higher than expected and demand for loans increased on the back of a strengthening US economy.

Wells Fargo & Co, the fourth-largest bank by assets, was also to report on Friday morning. – Reuters