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Citigroup's second quarter results didn't live up to the expectations of many analysts, although the company's profits more than quadrupled.

"Our businesses faced challenging conditions during the quarter," said Charles Prince, CEO of Citigroup. "The capital markets environment was one of the worst we have seen in years, and combined with a flattening yield curve, led to a significant decline in our fixed income markets revenues."

"Rising short-term interest rates and a flattening yield curve resulted in spread compression across several businesses," continued Prince. "New bankruptcy legislation caused a short-term spike in bankruptcy filings, adding approximately $175 million to our credit costs in North America cards. Despite these challenges, our diversified business platform generated strong profitability."

Citigroup reported that it's second-quarter net income went up to $5.07 billion from $1.14 billion in the second quarter of last year, while income from continuing operations reached $4.73 billion, up from $916 million.

"In the second quarter, we continued to sharpen our focus on Citigroup's leading franchises and invest to extend our competitive advantages," said Prince. "We announced the sale of substantially all of Asset Management and we closed the sale of our Life Insurance and Annuities business on July 1st."

"We expect to significantly enhance our private client business with the addition of Legg Mason's brokerage business and announced an important credit card partnership with Federated," added Prince. "We continued to expand our distribution network globally, adding 135 new retail banking and consumer finance branches, and we expanded our "ThankYou" Rewards Program to our U.S. retail banking customers."

Prince also pointed out that the company has made progress regarding legal matters, such as an agreement to settle with Enron, and the conclusion of settlements with UK Financial Services Authority, and the SEC.

Chris is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news.