Citigroup Inc, the No.3 U.S. bank by assets, reported a massive jump in quarterly profit as legal costs plunged and the bank benefited from the sale of unwanted assets from its Citi Holdings portfolio.
Citi, which has been restructuring to focus on more profitable businesses and promising markets, said net profit rose to $3.34 billion, or $1.02 per share, in the fourth quarter from $344 million, or 6 cents per share, a year earlier.
Excluding items, the bank earned $1.06 per share, topping the average analyst estimate of $1.05, according to Thomson Reuters I/B/E/S.
Adjusted revenue rose 4.2 percent to $18.64 billion, but the increase came from gains on disposal of assets from Citi Holdings.
Citi shares fell 2.5 percent in premarket trading on Friday.
Total expenses fell 22.8 percent to $11.13 billion.
"We have undoubtedly become a simpler, smaller, safer and stronger institution," Chief Executive Michael Corbat said in a statement. "We have sharpened our focus on target clients, shedding over 20 consumer and institutional businesses in the process," he said.
Adjusted revenue from the main Citicorp business declined 2 percent, but profit rose as expenses in the business fell 24 percent. Legal and repositioning charges fell to $724 million.
Corbat has been looking to shrink Citi to a more profitable core and return capital to shareholders. At the same time, he's been looking on invest in building some of the company's businesses, such as Citi-branded payment cards in the United States.
Investors' doubts have been reflected in Citi stock price, which at Thursday's closing price of $45.38 was substantially lower than its tangible book value, pegged at $60.61 as of December end.
(Reporting by Sweta Singh and David Henry; Editing by Kirti Pandey)