The last time I checked, paying off loans counts so it's incorrect to say that Citibank delivered a profit. Just because they had what appeared to be a profit and then paid down some of the loans doesn't mean they really had a profit. If you tried floating such a pile of bull as a customer at Citi, I doubt they would buy it. I'm not buying it either because it's bull. Playing accounting games hardly inspires confidence though Wall Street may very well run with this "success" today. Some believe these quarterly report surprises are no indication of a long term health of the banks and may be false starts.
Citigroup surprised Wall Street Friday as the company delivered its first profit in more than a year, helped by strength within its investment banking division.In other words, it was a loss. Brace yourself for the "stress test" results coming out next week. Few believe Citi is healthy but if the government review shows them looking strong, the entire review will be considered suspicious if not worthless.
The company reported net income of $1.6 billion during the first quarter, up from a loss of $5.1 billion a year ago.
Yet, after taking into account the conversion price of a $12.5 billion preferred share offering from January 2008, and $1.22 billion in preferred stock dividend payments to the U.S. government among others, Citigroup reported a loss of $966 million, or 18 cents a share.
