© Reuters. FILE PHOTO: Customers use ATMs at a Citibank branch in the Jackson Heights neighborhood of the Queens borough of New York City, U.S. October 11, 2020. REUTERS/Nick Zieminski/File Photo
By Manya Saini and Tatiana Bautzer
NEW YORK (Reuters) – Citigroup (NYSE:)’s profit was broadly steady in the third quarter, fueled by rising interest payments and surging investment banking fees.
The bank’s net income rose to $3.5 billion from a year ago, it reported on Friday, while earnings per share remained stable at $1.63, exceeding the consensus estimate of $1.21 by analysts polled by LSEG.
Revenue at Citi’s institutional clients group that houses its Wall Street operations increased 12% from a year ago, fueled by a jump in investment banking fees. The gains were a bright spot after several quarters of depressed dealmaking.
Citi’s overall revenue climbed 9% to $20.1 billion.
The third largest U.S. lender set aside more money to cover potential bad loans, even though delinquency levels were still low compared to historical levels.
CEO Jane Fraser announced a sweeping reorganization last month that will disband ICG and give her more direct oversight over the company’s businesses. The new structure is not yet reflected in the third-quarter results.
Expenses rose due to rising costs and investments in control systems. The expenses included severance payments for employees who were laid off during the sale of its international businesses.
Citi has not yet announced the expected headcount reduction and expected savings with the reorganization that will reduce management layers and prompt layoffs across its businesses. Fraser has said there was “no room for bystanders” as the bank embarked on its biggest overhaul in almost two decades. The changes are being rolled out at a time of economic uncertainty that has weighed on some of Citi’s key businesses like trading.
Rivals Wells Fargo and JPMorgan Chase (NYSE:) also reported higher quarterly profits on Friday, boosted by a rise interest payments.
