Citi’s Trading Windfall No Match for Surge in Souring Loans (2)

Citigroup Inc.’s bond traders just posted their best quarter in eight years -- a feat that was no match for the tidal wave of souring loans that walloped the bank’s profits.

The deadly pandemic that sent global markets swooning helped the firm’s fixed-income, currencies and commodities traders generate $4.79 billion, trouncing analysts’ estimates by more than $1 billion. But the firm simultaneously set aside $7.03 billion to cover potential losses on loans. Net income fell short of projections.

The divergence, mirroring trends at larger rival JPMorgan Chase & Co., showed how unprecedented government efforts to contain the spread ...