Citigroup beat earnings expectations on Monday as profit swelled by 42 percent in the second quarter as the sprawling bank works to cut its costs and expand its international lending operations.
The bank, which has hitched much of its hopes for growth to emerging markets, reported a profit of $4.18 billion, or $1.34 a share, compared with $2.94 billion, or $1 a share, in the period a year earlier. Citigroup, the nation’s third-largest bank by assets, reported revenue of $20.5 billion, up 12 percent from revenue in the period a year earlier.
Excluding a $477 million gain that stemmed from a valuation adjustment on Citi’s debt, the bank reported earnings of $1.25 a share. Earnings were bolstered by strong gains in trading revenue.
The results on Monday exceeded analysts’ expectations of $3.55 billion in profit, or $1.19 a share. Citibank was expected to report revenue of $19.76 billion, up from $18.64 billion a year earlier.
With international lending operations that dwarf those of many of its United States rivals, Citi’s opportunities for growth rise and fall with the fate of emerging markets. Any sluggishness overseas, particularly in Mexico where Citi has alarge presence, always lurks as an issue that could undercut the bank’s earnings.
During a conference call on Friday, Jamie Dimon, the brash chairman and chief executive of JPMorgan Chase, commented on the strength of emerging markets when the bank reported its earnings. “Our folks in emerging markets did a particularly good job, which might not be the same for some others reporting,†he said.
Citigroup has been wrestling with largely stagnant growth in its consumer banking unit and turbulence in Asia and Latin America.
