Profits at Citibank's European business grow 10% to €516m

PROFITS AT Citibank’s Irish-based European business grew 10 per cent to over €500 million last year, its latest figures show.

Citibank Europe plc, whose head offices employ 2,000 people in Dublin, published accounts showing that profit for 2009 was €516 million, an increase of almost 10 per cent on the €472 million surplus it earned the previous year.

The US group’s Irish operations provide banking and transaction services for corporate customers in Europe, the Middle East and Africa, which allow them to make and receive payments and generally carry on their businesses.

It also provides fund administration services. In 2008 and 2009 it expanded into providing the full range of consumer and business banking in the Czech Republic, Poland, Hungary, Slovakia and Romania.

The corporate business provides most of the profits, says chief executive Aidan Brady.

The accounts show that it had net interest income of €300 million and credit losses, consisting of both impairment charges and write-offs, of €149 million.

Net fees and commissions last year came to almost €700 million, between 7 per cent and 8 per cent higher than the €645 million recorded in 2008.

Its operating profits topped €1 billion, while profits before tax were €600 million. Shareholders’ funds grew 40 per cent to €3.5 billion.

The notes to the accounts state that the acquisition of the group’s branches in three eastern European countries added €21 million in assets to the balance sheet during the year.

Last year it paid €176 million in salaries, shares, pension and social insurance to its employees.

Citibank is researching and developing new technology for managing corporate transactions in Dublin, and is committed to spending €100 million on this activity.

The Irish bank is part of the US-based Citigroup, which was reorganised last year into Citicorp, which owns the traditional banking businesses, and Citiholdings, which took over the toxic assets left after the financial crisis.

The US government took a 37 per cent stake in the group in exchange for guaranteeing around $25 billion worth of risky assets in late 2008.