Citigroup announced on Thursday that its second-quarter profits were down 73 per cent to a 6-year low, after setting aside $4.95 billion for legal costs related to its role in several corporate scandals.
The bank said net income fell to $1.14 billion, or 22 cents per share, from $4.3 billion, or 83 cents per share, a year earlier. Excluding items, profit would have risen 24 percent to $5.34 billion, or $1.02 per share.
Revenue rose 15 percent to $22.3 billion. Expenses rose 87 percent to $18.6 billion, but would have risen 7 percent excluding the legal charges, Citigroup said.
In May, Citigroup said it would pay $2.65 billion to settle claims by investors in WorldCom, now known as MCI, that it hid risks. It also increased reserves to pay for pending lawsuits involving energy trader Enron Corp, alleged biased stock research, initial public offerings and other matters.
The Q2 results also included a gain of $756 million, or 15 cents per share, for the sale of a 20 percent stake in Saudi Arabian bank Samba Financial Group.