Although revenue was down on a year-over-year basis in the second quarter, Citizens Financial Group posted a 5 percent increase in total assets, largely driven by loan and lease growth.
The parent company of Citizens Bank posted revenue totaling $1.2 billion in the quarter ended June 30, representing a decline of $273 million from the year-ago quarter. Net income in the second quarter totaled $190 million, compared with $313 million last year. Last year’s second quarter included an after-tax gain of $180 million from the sale of 94 Chicago-area Charter One branches.
“We are pleased with our ability to continue to execute well against the key initiatives in our turnaround plan,” Chairman and CEO Bruce Van Saun said in a statement. “During the quarter we demonstrated strong loan and deposit growth and good expense discipline, which combined for solid operating leverage, on an adjusted basis. We have launched a series of further initiatives which should continue to help the trajectory of our financial performance.”
Compared with the year-ago quarter, net interest income increased $7 million to $840 million, while noninterest income declined by $280 million to $360 million. Excluding the impact that Chicago divestiture had on last year’s second quarter earnings, the company estimated noninterest income had increased by $8 million on a year-over-year basis.
Noninterest expenses declined $107 million to $841 million, driven by a decrease in restructuring charges and special items.
Net income from the company’s consumer banking business increased $22 million, or 50 percent, on a year-over-year basis to $66 million. Total loan and leases in that business line increased by $3.7 billion, or 8 percent, to $51 billion.
Net income from Citizens’ commercial banking segment increased $6 million, or 4 percent, to $135 million. Total loans and leases there increased $4.1 billion, or 11 percent, year-over-year to $41.5 billion.
The company set aside $1.2 billion in its allowance for loan and lease losses, representing no change from the prior quarter and a $9 million, or 1 percent, decrease from the year-ago quarter. Allowance for loan and lease losses to total loans and leases totaled 1.24 percent on June 30, compared with 1.27 percent on March 31, and 1.36 percent a year ago.
Net charge-offs totaled $78 million and represented an increase of $24 million from the first quarter. Retail product net charge-offs declined $5 million from the first quarter to $71 million in the second, while commercial net charge-offs totaled $7 million, compared with $22 million in net recoveries during the first quarter.
Nonperforming non-core loans totaled $163 million in second quarter, compared with $171 million in first quarter, and $197 million in the year-ago quarter. Nonperforming non-core loans to total non-core loans totaled 6.1 percent at June 30, compared with 6 percent at March 31, and 5.8 percent a year ago.
Total assets increased $7 billion, or 5 percent, to $137.3 billion, compared with the year-ago period.
