Citigroup’ reported higher third-quarter net income on Monday, as the bank set aside less money to cover bad loans. Its shares rose in pre-market trading.
Citigroup [C 28.40 0.76 (+2.75%) ], the third-largest U.S. bank by assets, reported net income of $3.8 billion, or $1.23 per share, up from $2.2 billion, or 72 cents per share, a year ago.
The bank reported revenue of $20.83 billion, up slightly from $20.73 billion a year ago.
According to Thomson Reuters, analysts expected the financial-services group to earn 81 cents per share on revenue of $19.24 billion.
Third quarter revenues included $1.9 billion of credit valuation adjustment, which reflects the widening of Citi’ credit default spreads during the third quarter.
“Citi continues to navigate a challenging economic environment and delivered another quarter of solid operating results,” Vikram Pandit, Citi’ Chief Executive Officer, said in a statement. “We have reduced the size of Citi Holdings to 15 percent of our balance sheet and further improved our financial strength.”
“The initial reaction Is that the earning and numbers look very solid,” said Channing S. Smith, co-manager of The Capital Advisors Growth Fund, which owns Citi shares. “Right now for us it’ just kind of a relief. We know that the underlying business models of these companies are strong the underlying businesses are performing well despite headwinds.”