Citigroup Earns $2.15 Billion as Loan Losses Decline

Citigroup Inc., which is still 12 percent owned by the government, reported its third straight quarter of profit Monday as losses from failed loans narrowed.

The New York-based bank earned $2.15 billion, or 7 cents per share, in net income available to common shareholders. That compares to a loss of $3.24 billion, or 27 cents per share, during the same quarter last year. The results were a penny per share better than analysts' forecasts, according to Thomson Reuters.

Citigroup was one of the hardest-hit banks during the financial crisis of 2008 and received $45 billion in government aid, $25 billion of which was converted to stock. The government is still reducing its stake in Citigroup.

Citigroup's results included a previously announced $800 million pretax loss tied to the sale of Student Loan Corp.

Losses from bad loans fell 30 percent during the quarter to $7.66 billion as defaults in Citi's retail partner cards, Citi-branded credit cards and real estate portfolios all fell.

Citigroup released $1.97 billion in money it had previously set aside to cover bad loans.

The drop in defaults is a signal that consumers could be getting their footing again. Rival banking giant JPMorgan Chase & Co. also reported better results last week as losses narrowed from failed loans. Bank of America Corp. reports results Tuesday.

Shares of Citi rose 9 cents, or 2.2 percent, to $4.04 in pre-opening trading.