Citigroup: separate units perform very differently
NEW YORK (Reuters) - Citigroup Inc (C.N) said it will report separate financial data for its two new operating units starting with second-quarter results next Friday, and released historical data showing markedly different past performance for the businesses.
The change was announced six months after Citigroup set plans to effectively split in two. Citicorp, at the time comprised roughly 56 percent of the bank's assets and still includes retail and commercial banking businesses that Citigroup wants to keep, while Citi Holdings includes consumer finance, brokerage and toxic assets that the bank wants to shed.
Citigroup is hoping the new presentation will provide greater assurance to investors about the longer-term health of the New York-based bank, as reflected in its Citicorp businesses.
Citi Holdings is where the bank has since late 2007 incurred the bulk of its losses.
These have led to a series of federal bailouts including $45 billion of aid, and which may leave the U.S. government with a 34 percent equity stake in what is still the nation's third-largest bank by assets.
According to a regulatory filing, Citicorp last year posted net income of $6.14 billion on revenue of $60.56 billion. Citi Holdings, in contrast, had a net loss of $35.64 billion on revenue of negative $6.7 billion. The latter amount was negative largely because of writedowns.
In the first quarter of 2009, Citicorp had a profit of $7.69 billion on revenue of $20.57 billion. Citi Holdings, in contrast, had a $5.34 billion loss on revenue of $3.45 billion.
The gulf between the results underscores the challenges that Citigroup faces to shed its weaker-performing and troubled assets, especially in light of the investor and government pressure that prospective buyers know Citigroup faces to succeed.
Gary Crittenden, who had been chairman of Citi Holdings, said on Thursday he would leave to join a private equity firm.
Analysts on average expect Citigroup as a whole to post a second-quarter loss, according to Reuters Estimates.
Citigroup shares closed Friday down 10 cents at $2.59 on the New York Stock Exchange.
(Reporting by Jonathan Stempel)
