While Citigroup reported higher net income and revenues in the first quarter year over year, the investment bank and financial services company revealed in its earnings release that its mortgage operations weighed down on results.
Citigroup reported that revenues increased 3% from the prior-year period, reflecting growth in both the Institutional Clients Group and Global Consumer Banking. Revenues in its consumer banking segment increased 7% to $8.4 billion, driven by growth across all regions. In North America, segment revenues grew 4% to $5.2 billion as revenues for all businesses increased.
North America retail banking revenues grew 4% to $1.3 billion. However, excluding mortgage, retail banking revenues increased 8%, driven by continued growth in deposit margins, growth in investments and loans, and increased commercial banking activity.
Citigroup reported net income of $4.6 billion, an increase of 13%, driven by the higher revenues and a lower effective tax rate, partially offset by higher expenses and cost of credit.
“Our first quarter results demonstrate strength and balance across our franchise and position us well for the rest of the year,” Citi CEO Michael Corbat said. “We grew revenue across both our institutional and consumer businesses and delivered solid, client-led revenue gains in areas we have been investing in such as Citibanamex, TTS, Equities, and the Private Bank.”
Corbat also said the company has improved on its return of capital during the quarter as it returned more than $3 billion in capital to common shareholders. He also said Citigroup remains on tracks to meets previous commitments of returning at least $60 billion over the 2017, 2018, and 2019 cycles, subject to regulatory approval.
“While market conditions have been uneven so far this year, our first-quarter results show our ability to deliver for both clients and shareholders and we look forward to sustaining this momentum for the balance of the year,” Corbat said.