Citigroup (NYSE: C) has beat analysts’ expectations for second-quarter profit and revenue. The bank posted profit of $4.79 billion, or $1.95 per share, compared with the $1.80 expected by analysts. This was a 20 percent rise over results from the same quarter of the previous year, when the bank reported profit of $1.63 per share.
A $350 million pretax gain from the initial public offering of electronic bond trading platform Tradeweb helped Citi’s quarterly results. Excluding the impact of the IPO, the bank would have posted $1.83 per share in profit. Tradeweb went public in April in what was then second-biggest IPO of the year.
Citi said revenue climbed 2 percent to $18.76 billion, beating analysts’ $18.5 billion estimate. The result was almost unchanged from the same period a year earlier. Declines in trading and investment banking revenue and losses on loan hedges hurt results.
The bank’s drop in trading revenue was bigger than expected. Trading revenue excluding the IPO windfall fell 5 percent from the year ago quarter. Chief Executive Officer Michael Corbat forecasted such a decline as far back as May. Chief Financial Officer Mark Mason cited a challenging trading environment in fixed income, currencies and commodities.
The bank’s fixed-income markets revenue was disappointing. Fixed-income revenue rose 8 percent to $3.32 billion, but excluding the Tradeweb transaction, the bank would have posted a 4 percent decline in that division. The bank’s equity markets revenue was also disappointing with a 9 percent drop in revenue. Equity markets revenue was $790 million, lower than estimates of $824 million.
The bank’s consumer division was a bright spot in the report, posting its strongest second quarter since 2013. Revenue from consumer banking climbed 3 percent to $8.51 billion, topping projections. Profit rose 11 percent to $1.41 billion, compared to the $1.49 billion estimate of analysts.