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Citi’s profit surges

Financial services company reports Q1 net income of $4.4bn, up from Q4 net loss of $7.6bn in 2009.

Citigroup's results were helped by the global economic recovery which boosted the values of its battered assets and allowed it to set aside fewer funds to cover credit losses.

Excluding the $6.2bn after-tax loss of the Troubled Asset Relief Programme (TARP) repayment, the US government programme to address the subprime mortgage crisis, and the exit of the loss-sharing agreement in the fourth quarter of 2009, net income increased $5.8bn. Securities and banking revenues increased $8bn from $3.3bn in the fourth quarter of 2009, and Citigroup expenses were $11.5bn, down $796m, or 6 per cent, from the prior quarter. Net credit losses of $8.4bn were recorded in the first quarter down $1.6bn or 16 per cent.

"We are proud of our first quarter results but remain cautious about the environment, given the uncertain economic recovery and high unemployment in the US Realistically, we do not expect our performance to follow an invariable trend-line upward. Longer-term, however, the prospects for Citi are clear and bright," said Vikram Pandit, CEO of Citigroup. "Our performance was aided by stability in the capital markets and improvement in the global business climate."