Citigroup is carried by its bank financing and investment activity. The largest bank in the world and recorded an increase of 4 of the net profit in the second quarter, at 5,265 billions of dollars through its performance in this trade, which enabled him to compensate for an increase in the operational costs of the group. A constant structure basis, net profit grew even 11 to 5,262 billion. For its part, the turnover jumped 10 to 22,182 billion in the second quarter.
But these outcomes, slightly below analysts forecasts, were disappointed: the American course of award of the first universal bank to announce its quarterly results decreased by more than 2 yesterday afternoon in New York. Yet, in the financing and Investment Bank, turnover grew by 31 to 6,761 billion, in the second quarter, and that, "despite a difficult market conditions in developing countries", welcomed Chuck Prince, CEO of Citigroup, a telephone conference.
The American giant took the flight of mergers and acquisitions and its performance on the financial markets, which allowed him to enjoy beautiful brokerage commissions. Revenues of the activities of "trading" on the bond market thus increased by 51, to $ 2.76 billion, while those registered on the stock markets jumped 30 to $ 945 million. In activities of emission of shares and bonds, and the Council in mergers and acquisitions where it is second in the world in the classification of announced transactions , Citigroup overall posted an increase of 24 of its revenues, to $ 1.15 billion.
Citigroup has also improved its performance in retail banking. In the United States, its "Achilles heel", the turnover recorded in the Bank to individuals has certainly increased that 1 to $ 7.5 billion, but the net result increased by 11. "After having long struggled, we begin finally to reap the fruit of our work in the United States", commented Chuck Prince. The international retail banking revenues grew 12 to $ 5.07 billion and net income of 10.
Openings of agencies
Citigroup wants to grow again in the Bank, the international retail, multiplying overtures to agencies: 270 have been the only second quarter, including 44 in the Mexico, 12 in Brazil, Turkey 11, and 6 in Russia. "Our goal is to open 1,000 new agencies in the world this year", said Chuck Prince. The Bank however has to withdraw from the France retail bank, which the market is considered too difficult ("Les Echos" from July 11). Emphasis is also placed on the Bank via the Internet. Citibank Online Bank registered deposit $ 4.2 billion three months after its launch.
Expressing satisfaction with its strategy of organic growth, Chuck Prince also wants to expand its team of analysts (see box). But, and this is the reverse of the Medal, operational costs soared by 16 to 12,77 billion, drawn by the increase in investment. The weight of the salary expenses thus increased by 35 in the Investment Bank. On the other hand, the rise in short-term interest rates put margins under pressure. Two elements, whose effects should be still felt in the coming months and to explain the reaction of financial investors.
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