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Citigroup Earnings Plunge 60% on Subprime Woes

Posted Oct 1, 07 10:53 AM CDT in US,  Business 

(Newser) – Citigroup is the latest big-name victim of the subprime crash, the company announced today, warning of a 60% third-quarter earnings drop. Full earnings will be out Oct. 15, but it appears net income will drop to $2.2 billion from the $5.51 billion reported last year. “Our expected third-quarter results are a clear disappointment,” said CEO Charles Prince.

Even before the announcement, Prince was under pressure because of Citi’s stagnant share price, which fell 1% in early trading on the news. The group joins a host of financials who made losing bets on subprime-related investments. Prince promised a return to normalcy next quarter, which the Times says is when investors will learn the real extent of subprime’s ravages.

Source New York Times

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The Citibank logo is shown on a branch office in this April 11, 2007 file photo in New York. Citigroup Inc. said Friday, July 20, 2007 its second-quarter profit rose 18 percent as strong overseas operations...   (Associated Press)
A pair of patrons enter a Citibank branch in Boston, Monday, April 16, 2007. First-quarter profit at Citigroup Inc. dropped 11 percent, but still came in better then expected, as the nation's largest...   (Associated Press)
Japanese businessmen walk past a huge signboard of Citibank in Tokyo, Tuesday, March 20, 2007. In a sign of new openness in the world's second-largest economy, merger mania has gripped the nation and...   (Associated Press)
In this photo released by China's Xinhua news agency, a Chinese customer, left, consults about Chinese Yuan service with an employee at a branch of Citibank in Shanghai, China, Monday, April 23, 2007....   (Associated Press)
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