Citing rising credit card purchase volume in key regions outside the U.S., Citigroup Inc. today reported that its global branded credit card business earned a $166 million profit for the first quarter ended March 31, up 17.7% compared with $141 million a year ago. Revenues for the card unit totaled $4.27 billion, up 51.4% from $2.82 billion.
Worldwide Citi card purchase volume was $60.1 billion, up 0.8% from $59.6 billion a year ago. Purchase volume rose in all regions except North America, which accounts for 60% of the company’s total volume.
The net charge-off rate on Citi cards worldwide was 13.72%, up 532 basis points compared with 8.4% a year ago. Citi reported 51.3 million open card accounts worldwide as of the end of March, down 10.3% from 57.2 million a year earlier.
In North America, Citi’s branded cards unit contributed a loss of $162 million; it generated a $116 million profit a year ago. Purchase volume in North America fell 9.7%, to $36.2 billion from $40.1 billion. The charge-off rate on outstanding receivables was 10.67%, up 240 basis points from 8.27%.
Early-stage delinquencies of cards 30 to 89 days past due fell 10 basis points, to 2.76% from 2.86%. Citi reported 21.8 million open accounts in North America as of the end of the quarter, down 14.8% from 25.6 million a year earlier.
In Asia, purchase volume rose 22.9%, to $14.5 billion from $11.8 billion. The charge-off rate was 4.5%, down a basis point from 4.6%. Early-stage delinquencies fell 45 basis points, to 2.06% from 2.51%. Citi reported 14.8 million accounts open in Asia as of the end of March, down 6.9% from 15.9 million a year earlier.
In Latin America, purchase volume rose 23.7%, to $7.3 billion from $5.9 billion a year ago. The charge-off rate was 14.03%, down 127 basis points from 15.3%. Citi reported 12.1 million accounts open as of the end of the quarter, down 6.2% from 12.9 million a year ago.
In the Europe, Middle East and Africa region, purchase volume was $2.1 billion, up 16.7% compared with $1.8 billion. The charge-off rate was 6.97%, up 229 basis points from 4.68%. There were 2.6 million accounts open at the end of the quarter, down 7.1% compared with 2.8 million a year earlier.
In Citi’s North American private-label retail credit cards operation, purchase volume was $18.7 billion, down 20.1% compared with $23.4 billion a year earlier. The charge-off rate was 13.72%, up 174 basis points compared with 11.98%. Citi reported 95.1 million open private-label accounts, down 11.6% compared with 107.6 million a year earlier.
Citi said it is helping more than 1.5 million credit card customers manage their card debt “through a variety of forbearance programs,” the issuer noted in a press release.
During a conference call today with analysts, John Gerspach, Citi chief financial officer, said the company continues to see “stable to improving credit trends” in both its North America Citi branded cards and private-label card portfolios.” Private-label card losses declined for the third consecutive quarter, driven by “loss-mitigation efforts” and overall declining loan balances, he noted.
