Citigroup reports loss of $7.6bn
Wall Street banking giant Citigroup has reported a loss of $7.6bn (£4.7bn) for the final three months of 2009, largely due to repaying government loans.
Taking out the impact of these repayments, Citi recorded a loss of $1.4bn during the quarter.
The results were worse than analysts had expected but better than the $17.3bn the bank lost a year earlier.
Last week, rival bank JP Morgan reported profits of $3.3bn for the last three months of 2009.
Citigroup is more exposed to consumer loans than many of its major Wall Street rivals, who derive a higher proportion of their income from investment banking operations.
The bank’s shares fell more than 3% in early trading but soon recovered to $3.44, up 0.6% on the day.
‘House in order’
For the whole of 2009, the bank reported a loss of $1.6bn.
Despite the loss, the result was significantly better than the $27.7bn Citigroup lost in 2008 and chief executive Vikram Pandit said the bank had made “enormous progress in 2009”.
“It was our responsibility to get our own house in order. We greatly improved Citi’s capital strength, reduced the size and scope of the company, and refocused our business strategy to take advantage of our unmatched global network.”
He said the bank had repaid the $20bn it received through the Troubled Asset Relief Program (Tarp) to the US government during the year.
Last week, President Barack Obama announced a tax on big banks designed to recover some of the money the US taxpayer has paid in bank bail-outs.
The tax would apply only to financial institutions with assets of more than $50bn.
Bank of America, Morgan Stanley, Wells Fargo and Goldman Sachs all report their fourth-quarter 2009 results in the coming days.
Wall Street opened amid uncertainty as investors took in the Citigroup results.
After falling in the first few minutes of trade, the Dow Jones soon recovered and was up 46.7 points to 10,656.