Citigroup’s loan business improved in the fourth quarter as consumers did a better job of paying down their credit card balances, but the nation’s third largest bank by assets was hurt by investments and missed Wall Street forecasts.
Citi reported that profit declined 11 percent in the fourth quarter of 2011, mostly tied to investment banking losses and accounting adjustments to the value of corporate holdings.
Citigroup fourth-quarter net income totaled $1.2 billion, or 38 cents a share, down 7.7 percent from a year ago. Revenue fell 6.5 percent from a year earlier, to $17.2 billion.
Citigroup’s international business boosted results. Business and consumer loans increased 14 percent to $465 billion, with most of the growth coming from Latin America and Asia.
The number of Citi credit customers with late with payments by 90 days or more dropped 30 percent from the same period a year earlier. Citi is the fourth largest credit card issuer by purchase volume.
Citi’s losses from loans fell 40 percent, a bigger decline than the analysts expected. It allowed Citi to take a profit of $1.5 billion from the reserves the bank had kept aside for such losses.
However, volatile stock and bond markets in the fourth quarter resulted in a sharp drop of 45 percent in Citi’s investment banking revenue, to $638 million.
