Citigroup reported that second quarter profits for its credit card business in North America inched up by 1% to $861 million. Credit card outstandings for North America also grew a modest 1% over 2Q/04 to $139.8 billion, impacted by higher payment rates. The figure includes $25.3 billion in private label card outstandings. This is the second time Citi’s second quarter outstandings came in lower than the first quarter, according to CardData ([www.carddata.com]). Purchase and cash advance volume increased 9% year-on-year to $72.2 billion. Citi’s account base at the end of the second quarter declined by 1.6 million accounts from the prior quarter and was down 2% from one-year ago. At the end of 2Q/05, Citi had 127.1 million accounts in North America. Citi’s charge-offs increased from 5.50% in the first quarter, to 5.71% for 2Q/05. Charge-offs for bank credit cards jumped to 5.59%, compared to 5.20% in the first quarter and 6.15% one-year ago. Charge-offs for private label credit cards dropped from 6.91% in the first quarter to 6.28% for 2Q/05. Charge-offs for private label cards remain well below year-ago levels by 233 basis points. Delinquency (90+ days) declined slightly from 1.76% for 1Q/05 to 1.70% for the second quarter 2005. Delinquency for bank credit cards was down 15 basis points from the year-ago level. Citi noted that the new bankruptcy legislation caused a short-term spike in bankruptcy filings, adding approximately $175 million to its credit costs in North America cards. For complete details on Citigroup’s 2Q/05 performance, visit CardData ([www.carddata.com]).
North American Credit Card Net Revenues
2Q/04: $850 million
3Q/04: $1067 million
4Q/04: $1190 million
1Q/05: $911 million
2Q/05: $861 million
Source: CardData (www.carddata.com)