April 18, 2013 / 8:06 PM / in 5 years

E*Trade 1st quarter profit falls 78 pct, meets expectations

NEW YORK, April 18 (Reuters) - E*Trade Financial Corp. on Thursday reported progress in winding down its loss-plagued bank lending businesses and buffering its core discount brokerage business.

The New York-based company said first-quarter net income fell 78 percent from a year earlier to $35 million, or 12 cents a share, but improved from a loss of $186.1 million in last year’s fourth quarter.

“The first quarter was encouraging, as we posted solid sequential growth in customer engagement, accounts and assets,” said Chief Executive Officer Paul Idzik in a prepared statement.

Idzik joined in January as E*Trade’s sixth CEO since 2009, a sign of the turmoil that has battered the firm.

The company’s earnings per share matched the average estimate of 17 analysts reviewed by Thomson Reuters I/B/E/.

Profit was driven by 30,000 new brokerage accounts in the quarter, $3.1 billion in new customer assets and commission-generating daily trades that grew 16 percent from the fourth quarter of 2012.

The company’s provision for loan losses fell to $43 million from $74 million in the fourth quarter, a sign of a contraction in its bad loans, but its interest income and margins also fell on fewer loans and a decline in short-term interest rates.

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