Citigroup reported that 2Q/06 profits for its U.S. Cards unit rose 19% year-on-year to $878 million driven by lower bankruptcy filings and a favorable credit environment. However, total revenues for the U.S. card unit were flat at $3.25 billion compared to the year-ago quarter. Citi says the lackluster growth in average managed loans and a 12% increase in purchase sales were offset by higher payment rates and net interest margin compression. Bank credit card outstandings for the U.S. were also flat at $111.3 billion compared to $111.9 billion one-year ago. But, private label card outstandings increased 27% to $29.4 billion. Citi says the growth in managed loans reflected a shift from traditional card products to higher reward and private label card balances, including the addition of Federated card receivables. Purchase volume increased to $77.9 billion for the second quarter. Citi’s account base at the end of the second quarter rose 18% to 144.4 million accounts. Citi’s charge-offs for bankcard and private label cards rose to 4.11% compared to 3.90% in the prior quarter, and 5.58% one-year ago. Overall delinquency (90+ days) dipped slightly from 1.74% for 1Q/06 to 1.58% for the second quarter 2006. For complete details on Citigroup’s 2Q/06 performance, visit CardData ([www.carddata.com][1]).
CITIGROUP
U.S. Credit Card Net Income
2Q/05: $ 735 million
3Q/05: $ 797 million
4Q/05: $ 444 million
1Q/06: $ 926 million
2Q/06: $ 878 million
Source: CardData (www.carddata.com
[1]: http://www.carddata.com
