Citi?s US Card Group Sees Declines in Quarter

Citigroup Inc. today reported its third quarter 2007 net income fell 57 percent to $2.4 billion from revenues of $22.7 billion, a 6 percent rise from the same period a year ago. Citi reported a net charge of $1.3 billion for loan loss reserves and net credit losses of $278 million in its U.S. consumer unit. The increase in credit costs was due to “increased delinquencies on mortgages and unsecured personal loans” and other factors, Citi reported.

The U.S. card division reported net income of $852 million, down 21 percent from nearly $1.1 billion in the same period a year ago. Citi attributed the decline to lower revenues from securitizations, greater expenses, and increased credit costs. Expenses grew 6 percent due to collection and servicing costs. Revenues for the division in the third quarter were $3.4 billion, down about 2 percent. There were 146.4 million open accounts at the end of the quarter, down from 151.1 million.

Average managed loans at the end of the quarter were $141.9 billion, up from $140.8 billion a year ago. The 90-day delinquency rate was 1.79 percent, flat from 1.80 percent in the third quarter of 2006. Net credit losses on the card portfolio were $399 million, or 4.39 percent, up 17 basis points from 4.22 percent a year ago.