Citigroup Inc suffered its fourth straight quarterly loss because of credit-related missteps and cut another 11,000 jobs.
The New York-based bank said yesterday it lost $2.8 billion, or US$0.60 per share, in the third quarter, compared with a profit of US$2.2 billion, or US$0.44 per share, a year ago.
That deficit for the period from June-to-September brings Citi’s total losses over the past 12 months to US$20.2 billion.
The shortfall for the quarter was narrower than anticipated.
Analysts polled by Thomson Reuters expected a loss of US$0.70 per share.
But the results were hardly reassuring. Citi wrote down US$4.4 billion in investments, recorded US$4.9 billion in credit losses, and took a US$3.9 billion charge to boost reserves.
The bank has written down the value of its investments in souring mortgages and other debt by more than US$50 billion since this time last year.
“While our third quarter results reflect both a difficult environment as well as continued write-downs on our legacy assets, we are making excellent progress on the parts of our business we control, including expense reduction, headcount, and balance sheet and capital management,” CEO Vikram Pandit said in a statement.
“We expect these improvements will enable us to realize the full earnings power of our franchise as the economy stabilizes,” he said.
The frailty of the financial system has led the government to pledge US$25 billion to each of the big four US banks — Citigroup, JPMorgan Chase & Co, Bank of America Corp and Wells Fargo & Co. Of these four institutions, Citi appears to be on the shakiest footing.
It is the only one to have posted quarterly losses over the past year, and it is shrinking while its peers are growing.
Citi not only eliminated 11,000 jobs during the third quarter — bringing its total headcount reduction so far this year to 23,000 — but it also shed US$50 billion in assets.
Pandit announced in May that Citi intends to rid itself of as much as US$500 billion in assets to get out of businesses such as risky mortgages. The bank said that over the past year, it has lopped off US$308 billion in total assets.
Meanwhile, the bank has not made any major acquisitions. While JPMorgan Chase snapped up Bear Stearns Cos and Washington Mutual Inc, and Bank of America Corp bought Merrill Lynch, Citigroup lost a bid for Wachovia Corp and its massive deposit base to Wells Fargo.
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
PLANS: MSI is also planning to upgrade its service center in the Netherlands Micro-Star International Co (MSI, 微星) yesterday said it plans to set up a server assembly line at its Poland service center this year at the earliest. The computer and peripherals manufacturer expects that the new server assembly line would shorten transportation times in shipments to European countries, a company spokesperson told the Taipei Times by telephone. MSI manufactures motherboards, graphics cards, notebook computers, servers, optical storage devices and communication devices. The company operates plants in Taiwan and China, and runs a global network of service centers. The company is also considering upgrading its service center in the Netherlands into a
Taiwan’s property market is entering a freeze, with mortgage activity across the nation’s six largest cities plummeting in the first quarter, H&B Realty Co (住商不動產) said yesterday, citing mounting pressure on housing demand amid tighter lending rules and regulatory curbs. Mortgage applications in Taipei, New Taipei City, Taoyuan, Taichung, Tainan and Kaohsiung totaled 28,078 from January to March, a sharp 36.3 percent decline from 44,082 in the same period last year, the nation’s largest real-estate brokerage by franchise said, citing data from the Joint Credit Information Center (JCIC, 聯徵中心). “The simultaneous decline across all six cities reflects just how drastically the market
RSS