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Citibank, the nation’s third largest financial institution, missed first quarter expectations this morning, earning $2.9 billion or $0.95 per share.
Analysts polled by Bloomberg were looking for the bank to post earnings of $1.02 per share.
Top line results at Citi also fell short of expectations, with revenue over the first three months of $19.41 billion, half a billion dollars below forecasts.
However excluding accounting adjustments for changes to its credit and debt valuations, earnings would have topped the Street’s consensus, at $1.11 on revenue of $20.2 billion.
“While our businesses operated in an improved environment, we also saw the benefit of our investments. We generated revenue growth and had positive operating leverage across all three of Citi’s core businesses,” Vikram Pandit, Citi’s Chief Executive Officer, said.
Citi’s largest division by revenue, Global Consumer Banking, saw revenue up five per cent year-on-year to $10.0 billion as “improved results in mortgages” boosted the top line.
The company’s investment banking division saw revenue increase two per cent from a year ago, to $865 million. Citi said strength in corporate advisory helped offset weakness in its equity and debt underwriting businesses.
Fixed income revenue also surged during the quarter, when excluding credit valuation adjustments. Strong rate and currency trading fuelled a 19 per cent increase during the first three months to $4.7 billion.
Citibank is set to announce quarterly results for the first three months of 2012 in a few minutes, following financial heavy weights J.P. Morgan Chase and Wells Fargo who reported on Friday.
The bank is expected to post earnings per share of $1.02 on revenue of $19.9 billion.
Analysts have generally had upbeat expectations on the nation’s third largest bank by assets.
“Going into [first quarter] results, we think Citi…may be better positioned (given upside from capital markets, expenses and provision expense),” Deutsche Bank analyst Matt O’Connor says.
Citi recently failed the Federal Reserve’s stress test, the largest institution to do so — peers like J.P. Morgan, Bank of America, Morgan Stanley and Goldman Sachs were all given the green light from the nation’s central bank.
Analysts will be looking for some update on the company’s plans to resubmit its capital plans in a black swan event.