PROVIDENCE – Citizens Financial Group Inc. reported a 39.3 percent drop in net income and 15.7 percent decline in total interest and non-interest revenue in its second-quarter earnings report released Tuesday.
The parent of Citizens Bank said second-quarter net income totaled $190 million, or 35 cents per diluted share, compared with net income of $313 million, or 56 cents per diluted share, in the 2014 second quarter.
It said the 2014 second quarter included the benefit of a $180 million after-tax gain related to the divestiture of its Chicago branches.
Total second-quarter interest and non-interest revenue fell to $1.3 billion from $1.6 billion during the year-ago period, again driven by the impact of the Chicago divestiture, which boosted second-quarter revenue last year by approximately $313 million, the bank said.
Bruce Van Saun, Citizens’ chairman and CEO, said the bank is “on the right track.”
“We are pleased with our ability to continue to execute well against the key initiatives in our turnaround plan. During the quarter we demonstrated strong loan and deposit growth and good expense discipline, which combined for solid operating leverage, on an adjusted basis,” he said.
The bank also said the second-quarter results were reduced by $25 million after-tax from restructuring charges and special items, largely related to efforts to improve processes and enhance efficiencies, as well as re-branding and separation from Royal Bank of Scotland PLC.
Total assets climbed 5.4 percent to $137.3 billion from $130.3 billion a year ago. Driving that growth was an increase of 8.7 percent in loans and leases to $96.5 billion. Nonperforming loans and leases fell to $1.0 billion from $1.2 billion a year earlier, dropping to 1.09 percent of all loans and leases from 1.35 percent in the 2014 second quarter, even as the provision for credit loans taken in the period increased to $77 million from $49 million a year earlier. The bank noted in the earnings release that this size provision reflected “a return to more normalized net charge-off levels from the prior quarter, which benefited from a large commercial real estate loan recovery.”
Period-end deposits grew 9.8 percent to $100.6 billion from $91.7 billion a year ago, as checking with interest, savings, money market accounts and term deposits all experienced year-over-year gains.
The bank reported that its net interest margin fell to 2.72 percent from 2.87 percent in the 2014 second quarter.
