Citigroup Inc. Monday posted a 35% rise in net profit over the same period last year, rising to $7.14 billion from $5.3 billion. The increase happened despite Hurricane Katrina-related setbacks and an uptick in bankruptcy filings.
Citi said Katrina carved out $222 million in the quarter, while bankruptcy filings cut $124 million. The company waived $25 million worth of loan fees and interest for hurricane victims during the quarter and, like other lenders, restructured payments for its customers living in the affected areas.
Lagging growth in the company's consumer finance receivables, Citi said, was a testament to its "ongoing decision" to stay away from aggressively priced teaser rate and interest-only mortgage products. Meanwhile, consumers flocked to rewards, new deposit and loan initiatives, leading to a 10% growth in card purchase sales and higher retail banking deposits and loans.
