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Earnings Roundup

Citigroup posts loss of $2.8 billion

October 17, 2008|From the Associated Press

Citigroup Inc., suffering its fourth straight quarterly loss and forfeiting the title of largest U.S. bank by assets, is falling behind in the historic reshuffling of the U.S. banking system.

New York-based Citigroup said Thursday that it lost $2.8 billion, or 60 cents a share, in the third quarter, contrasted with a profit of $2.2 billion, or 44 cents, a year earlier. The deficit for the July-to-September period brings Citigroup's total losses over the last 12 months to $20.2 billion.

The shortfall for the quarter was narrower than anticipated. Analysts polled by Thomson Reuters expected a loss of 70 cents a share; Standard & Poor's Ratings Services called the results "disappointing, but not entirely unexpected."

The results were hardly reassuring, though. Citigroup wrote down $4.4 billion in investments, plus an additional $612 million from a settlement related to auction-rate securities; recorded $4.9 billion in credit losses; and took a $3.9-billion charge to boost reserves. The bank has written down the value of investments tied to souring mortgages and other bad debt by some $51 billion since this time last year -- the most of any bank.

Citigroup shares fell 33 cents, or 2%, to $15.90.

With $2.05 trillion in total assets, Citigroup has become the second-largest bank by assets behind JPMorgan Chase & Co.'s $2.25 trillion. Bank of America Corp. has $1.91 trillion in assets and will have more when it completes its acquisition of Merrill Lynch & Co., which reported a $5.2-billion loss Thursday.

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