David Wells
in New York
Citigroup, the world's biggest financial services group, yesterday underlined the benefits of size and diversity by reporting a 17 per cent jump in annual net income to $17.85 billion (€14.2 billion), a record for any publicly traded company.
Earnings in the fourth quarter almost doubled to $4.76 billion, despite a $242 million charge related to Parmalat, the collapsed Italian dairy company.
The record profits come as other big banking groups try to copy Citigroup's model by turning themselves into broadly based financial supermarkets. The bank employs 1,000 people in Dublin.
Mr Chuck Prince, who recently took over from Mr Sandy Weill as chief executive, said Citigroup's model had been validated by the planned merger, announced last week, of JP Morgan Chase and Bank One.
Mr Prince said the earnings growth reflected the fact that the group did more for more clients in more places than any other financial services company.
While this means that it tends to have some exposure to most financial problems around the world the impact is usually modest in relation to the group as a whole.
JP Morgan's $58 billion deal follows Bank of America's recently agreed $47 billion acquisition of FleetBoston, fuelling expectations of a wave of banking mergers.
Mr Prince recently said he was not interested in making "transformative" acquisitions, preferring to focus on bolt-on acquisitions such as last year's purchase of the Sears credit card operation.
In a conference call yesterday, he said he would consider international acquisitions, but any purchases would be targeted.
Citigroup's global consumer business had income in the fourth quarter of $2.66 billion, up 14 per cent.
Its global corporate and investment bank made $1.28billion compared with a $326 million loss the year before, including a $1.3 billion after-tax charge for regulatory settlements and related civil litigation.
Citigroup's record annual net income topped the $17.72 billion Exxon Mobil earned in 2000.
The latter earned $14.86 billion, however, in the first three-quarters of 2003.- (Financial Times Service)
