Citi sees credit deterioration in India in Q2

NEW YORK: Citigroup, which swung into a second quarter profit, today said income from its banking division, Citicorp, fell by 40 per cent in Asia and also saw credit deterioration in India in the April-June period.

The income of Citicorp, the retail banking and commercial and investment banking division, in Asia slumped 40 per cent to USD 272 million compared to that in the year-ago period.

"Income (at Citicorp in Asia) was USD 272 million, down 40 per cent from the prior year period, as declining revenues and increasing credit costs were partially offset by expense reductions," Citigroup said in a statement.

"Card net credit loss rate increased to six per cent from 3.4 per cent in the prior- year period. Credit deterioration was particularly apparent in the card portfolios in India and Korea," the firm said.

Citicorp revenues from Asia declined by 14 per cent to USD 1.6 billion, primarily driven by the impact of foreign exchange and lower investment product volumes in Q2.

Credit costs were USD 504 million, up 55 per cent from the prior year period. Loan loss reserve build increased to USD 150 million from USD 84 million," the statement said.

Citigroup today posted a profit of USD 4.28 billion in the second quarter whereas it had a loss of USD 2.49 billion in the same period a year ago.