Citigroup (C) on Friday posted better-than-expected results for the second quarter, aided by a surge in investment banking revenue.
Earnings rose to $1.52 a share for the quarter through June 30 from $1.33 a year earlier, while revenue increased 4% to $20.14 billion, topping Wall Street’s views for $1.41 and $20.09 billion, respectively. The company said revenue growth included a roughly $400 million gain tied to an exchange of shares in credit card giant Visa (V) completed during the quarter.
“Our results show the progress we are making in executing our strategy and the benefit of our diversified business model,” Citigroup Chief Executive Jane Fraser said. “Markets had a strong finish to the quarter leading to better performance than we had anticipated.”
Banking revenue surged 38% to $1.63 billion, led by a 60% jump in investment banking amid “strong” issuance activity in debt capital markets and an increase in initial public offerings, the company said.
Markets revenue grew 6% to $5.09 billion, while services rose 3% to $4.68 billion. Wealth revenue increased 2% to $1.81 billion, while US personal banking gained 6% to $4.92 billion.
Citigroup shares were down 1.4% in Friday trade.
Operating expenses fell 2% year over year to $13.35 billion in the second quarter amid the company’s organizational simplification, stranded cost reductions and lower repositioning costs.
Citigroup expect full-year revenue of $80 billion to $81 billion. The Street is looking for $80.69 billion. The company said in a presentation that it intends to repurchase roughly $1 billion of common stock “this quarter.”
On Wednesday, the Federal Reserve and the Office of the Comptroller of the Currency fined Citigroup $135.6 million in aggregate for allegedly failing to make enough progress in addressing data management issues identified in 2020.