The biggest US bank, Citigroup, has posted a smaller than expected quarterly loss. That was despite 7.4 billion euros of write-downs and credit losses from deteriorating capital markets and the slumping US economy.
Its chief executive Vikram Pandit is trying to focus on stronger businesses and slash risky assets after years of poor management of risk and expenses.
The bank’s second-quarter net loss totalled 1.6 billion euros compared with profit of almost four billion euros for the same period last year.
Citigroup said it eliminated 11,000 jobs in the first half of the year and aims to keep cutting workers at a similar rate.
By contrast, Wall Street’s third-largest investment bank, Merrill Lynch, surprised markets when it announced a quarterly loss of almost three billion euros; that was twice as big as analysts had expected. It has written down about 25 billion euros since the credit crisis began a year ago.
Along with the losses it unveiled plans to shore up its capital by selling assets worth billions, including part of its lucrative brokerage business. Merrill Lynch cut over 4,000 jobs in the first half of the year.