The FINANCIAL — Citigroup Inc. reported net income for the second quarter 2013 of $4.2 billion, or $1.34 per diluted share, on revenues of $20.5 billion. This compared to net income of $2.9 billion, or $0.95 per diluted share, on revenues of $18.4 billion for the second quarter 2012.
CVA/DVA was a positive $477 million in the second quarter, largely resulting from the widening of Citi's credit spreads and the tightening of counterparty spreads, compared to a positive $219 million in the prior year period. Second quarter 2012 results included a loss of $424 million related to the sale of a 10.1% stake in Akbank T.A.S. Excluding CVA/DVA in both periods and the Akbank loss in the second quarter 2012,4 second quarter 2013 revenues increased 8% from the prior year period to $20.0 billion and second quarter 2013 earnings per diluted share were $1.25, representing a 25% increase from prior year earnings per share of $1.00. The increase in Citi's earnings per diluted share was driven by the higher revenues and lower net credit losses, which were partially offset by higher legal and related costs, a lower loan loss reserve release and a higher effective tax rate, according to Citigroup Inc.
"Our businesses performed well during the quarter and these results are well-balanced through our products and geographies, especially in the emerging markets, where growth is being challenged. We also continued to make progress in several critical areas. We reduced the earnings drag caused by Citi Holdings, where we saw the largest percentage reduction of assets since 2010. We again consumed a modest amount of DTA, bringing the total utilized to about $1.3 billion for the first half of the year. We increased our already strong capital levels, reaching an estimated Basel III Tier 1 Common ratio of 10%. Generating consistent and quality earnings is a key priority and this quarter met that goal," said Michael Corbat, Chief Executive Officer of Citi.
Citigroup revenues of $20.5 billion in the second quarter 2013 increased 11% from the prior year period. Excluding CVA/DVA and the Akbank loss in the second quarter 2012, Citigroup revenues of $20.0 billion in the second quarter 2013 increased 8% from the prior year period, with increases in both Citicorp and Citi Holdings, according to Citigroup Inc.
Citicorp revenues of $19.4 billion in the second quarter 2013 included positive $462 million of CVA/DVA reported within Securities and Banking. Excluding CVA/DVA and the Akbank loss in the second quarter 2012, Citicorp revenues of $18.9 billion increased 7% from the prior year period. Securities and Banking revenues increased 25% (or 21% excluding CVA/DVA) and Global Consumer Banking (GCB) revenues increased 2%, partially offset by a 1% decline in Transaction Services (CTS) revenues, all versus the prior year period, according to Citigroup Inc.
Citi Holdings revenues of $1.1 billion in the second quarter 2013 included positive $15 million of CVA/DVA. Excluding CVA/DVA, Citi Holdings revenues increased 17% versus the prior year period, driven by higher revenues in Local Consumer Lending and an improvement in Special Asset Pool revenues, partially offset by a decline in Brokerage and Asset Management revenues. Total Citi Holdings assets of $131 billion declined $60 billion, or 31%, from the second quarter 2012, according to Citigroup Inc. Citi Holdings assets at the end of the second quarter 2013 represented approximately 7% of total Citigroup assets.
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