NEW YORK — For big banks such as Citigroup, the first quarter of 2009 may turn out to be the best of the year.
Citigroup Inc., JPMorgan Chase & Co., Goldman Sachs Group Inc. and Wells Fargo & Co. all impressed investors over the past week with earnings reports that showed Wall Street’s 5-week-old rally was not in vain. Six weeks ago, Citigroup chief executive Vikram Pandit and other bank CEOs ignited the rally by telling investors that January and February were profitable.
“There’s life in this sector,” said Gary Townsend, chief executive of Hill-Townsend Capital LLC, but also “plenty of questions related to the sustainability of the results.”
So after bank stocks’ strong bounce in March and April, “they’re probably due for a breather,” said Fox Pitt Kelton banking analyst David Trone.
Citigroup posted a first-quarter loss to common shareholders of $966 million, or 18 cents per share, narrower than the 34 cents analysts predicted. But before paying dividends to preferred stockholders tied to a private stock offering in January 2008, the bank earned $1.6 billion. Revenue doubled from a year ago to $24.8 billion. A year ago, Citigroup suffered a loss of more than $5 billion.
On Friday, Citigroup stock slipped 36 cents, or 9 percent, to $3.65.
Promising news
