source: Wall street journal

Although Citigroup's performance has consistent as of late, it has not been able to generate any significant growth in this economy. Citigroup's third-quarter earnings showed respectable progress given a tough market environment and slowing of global economic growth.

However, a big portion of its revenue, USD 1.9 billion, originated from gains due to falls in the value of its own debt. The bank also benefited from USD 1.4 billion in releases of loan-loss reserves, and revenue in its securities and investment banking unit benefited by about USD 500 million from hedges on corporate loans.

This week Citigroup said its third-quarter earnings rose 74 percent from a year earlier, lifted by an accounting adjustment and continued strength in the bank’s international operations. In its third=quarter results, Citi booked a USD 1.9 billion gain tied to a change in the valuation of its own debt, and continued improvement in losses from soured loans allowed the bank to reduce its loan-loss reserve by USD 1.4 billion. Even without the accounting gain, Citi's USD 3.77 billion profit exceeded analysts' expectations.

Citigroup has turned the opinion of at least one critic. Saudi Arabian billionaire Prince Alwaleed Bin Talal, the biggest individual shareholder in Citigroup, said Monday the bank's third quarter results were “promising,” and he reiterated his support for its chief executive, Vikram Pandit. Last year in an interview, the Saudi billionaire said Pandit must deliver results, and the shareholders had already given the U.S. bank two years to turn itself around. Alwaleed hasn't hesitated to speak out against the bank’s management in the past, complaining that the bank's costs were rising faster than its revenue under former chief executive officer Chuck Prince.