Citigroup: Rising costs weigh on profits

( – Citigroup announced Friday a drop in its net profit for the fourth quarter due to a marked increase in its costs.

The American bank posted a net profit of $3.2 billion over the last three months of the year, or $1.46 per share, against $4.3 billion, or $1.92 per share, a year ago.

This performance is above the consensus, which was targeting EPS of $1.37.

The financial services group points out that its operating expenses rose by 18% to 13.5 billion dollars, under the effect of its investments aimed at the “transformation” of its activities.

Net banking income for its part increased by 1% to 17 billion dollars in the fourth quarter, against 16.8 billion a year earlier, a level also higher than the 16.8 billion expected by analysts.

“We had a decent end to the year, which allowed us to increase our annual net profit to some 22 billion dollars in a credit environment much more favorable than that of the previous year,” commented its managing director. Jane Fraser.

Citigroup shares were down more than 4% in pre-market quotations on Wall Street just following the publication of these results.

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