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| Citigroup quarterly profits plunge 27% | Citigroup quarterly profits plunge 27% |
| (about 2 hours later) | |
| US bank Citigroup has reported a 27% fall in first quarter profits compared with a year earlier. | US bank Citigroup has reported a 27% fall in first quarter profits compared with a year earlier. |
| It came as Citi said it had set aside more cash to cover losses on energy loans, and as the cost of shrinking some of its businesses increased. | It came as Citi said it had set aside more cash to cover losses on energy loans, and as the cost of shrinking some of its businesses increased. |
| Citi, which is restructuring to focus on more profitable businesses, saw net income fall to $3.5bn (£2.5bn) from $4.8bn the time a year earlier. | |
| However, the results were better than analysts had been expecting. | However, the results were better than analysts had been expecting. |
| Chief executive Michael Corbat said Citi was making progress "in becoming a simpler, smaller, safer and stronger institution". | Chief executive Michael Corbat said Citi was making progress "in becoming a simpler, smaller, safer and stronger institution". |
| The bank's profit decline, in the three months to the end of March, is the largest among big US banks that have reported first quarter results so far. | The bank's profit decline, in the three months to the end of March, is the largest among big US banks that have reported first quarter results so far. |
| Citi recently slipped from third to fourth biggest US bank by assets, after being overtaken by Wells Fargo. | Citi recently slipped from third to fourth biggest US bank by assets, after being overtaken by Wells Fargo. |
| The bank's revenue from fixed income markets dropped by 11.5% to $3.09bn, while investment banking revenue plunged by 27.2% to $875m. | The bank's revenue from fixed income markets dropped by 11.5% to $3.09bn, while investment banking revenue plunged by 27.2% to $875m. |
| "While our market-sensitive products clearly suffered from weak investor sentiment during the quarter, we continued to make progress in several key areas," said Mr Corbat. | |
| Energy protection | |
| Earnings per share were $1.10. Analysts had expected Citi's per share earnings to be closer to $1.03. | |
| The global banking industry has struggled since the start of year due to uncertainty surrounding the world's economic outlook, with a slowdown in China and the continued fall of oil prices. | |
| Citi was not alone in reporting lower year-over-year profit for the first quarter. Earlier in the week JP Morgan reported a 6.7% drop in profit. On Thursday, Bank of America reported that profits fell 13% in the first quarter and Wells Fargo reported a 7% drop. | |
| Like Citi, all three set aside cash to cover bad loans to the energy sector. | |
| Shrinking | |
| Citigroup has had a larger drop in profit is in part because it has greater exposure to emerging markets, where the economies have been slowing. | |
| The bank has been selling assets and leaving less profitable markets. Mr Corbat said the first quarter earnings included "a significant repositioning charge" of $491m. | |
| On Wednesday, Citi was one of the few large US banks to receive regulatory approval for its "living will" - that is the bank's plan to shut down operations in the event of another financial crisis. |