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Citing its efforts to reduce credit losses, Citigroup Inc. today reported a $6 million profit for its branded credit card business for the third quarter ended Sept. 30. The business lost $117 million during the same period last year. The net charge-off rate for Citi credit cards in all regions was 10.29% of average managed loans, up 390 basis points from 6.39% a year ago. Citi had 54.6 million open card accounts at the end of September, down 10.6% from 61.1 million a year earlier. Purchase volume during the quarter on Citi cards was $65.5 billion, down 13.2% from $75.5 billion a year ago. Average managed loans were $112.7 billion, down 4.8% from $118.4 billion. Regionally, in Latin America the net credit card charge-off rate was 18.05%, down 168 basis points from 19.73%. North America's charge-off rate was 10.15%, up 425 basis points from 5.9%. In the Europe, Middle East and Africa region, the net charge-off rate was 7.43%, up 498 basis points from 2.45%. The net charge-off rate in Citi's Asia region was 5.93%, up 230 basis points from 3.63% a year ago. At the end of September, Citi had 100.5 million open accounts tied to its nonbranded credit cards issued with retail partners in North America through its Citi Holdings division. That is down 13.1% from 115.6 million accounts a year earlier. The net charge-off rate on those cards was 13.3%, up 460 basis points from 8.7%. Companywide, Citi reported net income of $101 million, which compares with a$2.8 billion loss a year ago. John Gerspach, Citi chief financial officer, told analysts in a conference call today that Citi is making efforts to "reposition" its branded cards and those offered with retail partners, including removing high-risk customers from those card portfolios.
