Citigroup, the largest bank in the U.S. blamed delinquent mortgages and bad consumer lending and said both will get ever worse before the year is up.
Yes, you read that correctly; the CFO of Citigroup told a conference call that borrower defaults are “accelerating.”
Earnings dropped 57% in Q3, as CEO Charles Prince is reminded of the days Mr. Weil was around (mostly due to the higher stock price at that time). Earnings Per Share fell to $0.47, or $2.38 billion. These results included about $6.5 billion in consumer loans being written down.
The positive news is that revenues were up to $22.66 billion vs. $21.42 last year. Citigroup is the first of many banks reporting for the quarter. JPMorgan Chase (JPM) reports on the 17th, Bank of America (BAC) reports on the 18th.
I’m keeping this message short because we need to keep our eyes on the prize!