Citigroup dips,
but tops forecasts
Citigroup reported that first-quarter earnings fell 2 percent from the first quarter of 2011 to $2.9 billion, 95 cents a share, on revenues of $19.4 billion.
“While the operating environment improved in the first quarter, there is still much macro uncertainty and we will continue to manage risk carefully,” CEO Vikram Pandit said. “We will continue to leverage the depth and scale of our global presence to serve our clients.”
Operating expenses of $12.3 billion were essentially unchanged from the prior year period. Citigroup”™s cost of credit in the first quarter was down 5 percent from the year earlier period. Citgroup”™s allowance for loan losses was down to $29 billion at the end of the quarter, from $36 billion in the prior year period.
Asset quality improved ”“ consumer loans that were more than 90 days delinquent were down 21 percent from a year ago to $9.1 billion, or about 2.5 percent of consumer loans. Capital levels and book value also increased from a year ago.
“The report was boring,” said Gerard Cassidy of RBC Capital Markets. “That”™s beautiful in banking. There were no big write offs in capital markets, no big losses in the lending area, they”™re slowly but surely turning the company around. They”™re cutting operating expenses, selling off bad loans and streamlining so their processes are more efficient.
Net down for
JPMorgan Chase
JPMorgan Chase & Co. reported that first-quarter earnings fell to $5.4 billion from $5.6 billion in the first quarter of 2011. Earnings per share rose, however, to $1.31 from $1.28.
Chairman and CEO Jamie Dimon said that with respect to the mortgage banking business, “we expect to see elevated levels of costs and losses for a while longer.”
Mortgage banking application volume was up 33 percent from a year ago, primarily reflecting refinancing activity. Credit card sales volume was up 12 percent compared with the 2011 quarter.
At the investment bank, net income was $1.7 billion, down almost 30 percent from a year ago. The bank said that reflected lower revenue and less benefit from the provision for credit losses. Investment banking fees were down 23 percent.
In the retail financial services business, net income was $1.8 billion, compared with a loss of almost $400 million a year earlier. Revenue was up 40 percent. Mortgage production and servicing earned $461 million, compared with a loss of $1.1 billion a year earlier. Mortgage production related revenue was up 80 percent, driven by a favorable refinancing environment, including the effect of the Home Affordable Refinance Programs.
Wells Fargo
earnings rise
Wells Fargo & Co. reported a 14 percent rise in profit for the first quarter, to $4.2 billion, or 75 cents a share, from $3.8 billion, or 67 cents, in the first quarter of last year. The increase in per share earnings was 11 percent. Revenue of $21.6 billion was up 20 percent from the prior year quarter, led by strong mortgage banking results. The bank reported an improvement in credit quality, with net charge-offs of $2.4 billion, down $245 million from the prior quarter.
The bank said that as expected, expenses remained high in the quarter. Loans 90 days or more past due and still accruing were down from year-end.
“Banks are making money in ways other than lending,” said Jeffery Harte of Sandler O”™Neill and Partners in Chicago. “Credit continues to improve. Declining credit costs are helping offset interest rate pressure.”
Bank of New York Mellon
earnings dip
At Bank of New York Mellon, first-quarter profit slipped to $619 million from $625 million in the year earlier period. Investment services fees and investment management and performance fees both fell, as did foreign exchange and other trading revenue, down 21 percent. The bank said that reflects lower volume and volatility. Other trading revenue, meanwhile, more than doubled to $55 million, driven by higher fixed-income trading. Investment income rose, but the provision for credit losses tumbled to $5 million in the first quarter from $23 million in the fourth quarter of 2011.
Webster Bank profit up
Webster Bank, based in Waterbury, Conn. but with branches in Westchester, including White Plains, Scarsdale, Yonkers and New Rochelle, reported a 14 percent rise in earnings for the first quarter.
Profit rose to $38.3 million, or 42 cents a share, from $33.7 million, or 36 cents, a year earlier. Webster reported growth in commercial non-mortgage and commercial real estate loans, a rise in net interest income, and continued improvement in asset quality as shown by a 4.6 percent decline in nonperforming assets.
Westchester Bank
earnings riseÂ
The Westchester Bank, based in Yonkers, reported earnings rose more than 150 percent in 2011 to $2.8 million from $1.1 million in 2010. That included a tax benefit of $1.5 million and a gain of $112,000 on the sale of securities.
Loans were up 48 percent from 2010 to $141 million. Assets were up 33 percent to $215 million while deposits rose 23 percent to $190 million from $154 million.
The bank will be four years old in June. It focuses on serving small and mid-size businesses. It has branches in Yonkers and White Plains and expects to announce a third branch later this year.
