Dive Brief:

• Citi reported an 11% jump in payment card revenue in North America, to $2.3 billion, during its third-quarter earnings call Tuesday. Overall spending on the company’s cards climbed 5% compared with last year’s third quarter, to $142 billion.
• Net income increased 6% year-over-year to $4.9 billion on revenues of $18.6 billion, the bank reported. The overall revenue figure represented a 1% increase.
• Citi faces a challenge with expenses, which increased 1% from last year's third quarter. The bank is two months into a plan to cut 400 jobs and invest in new technology to save it $500 million this year. “As we’ve seen wallets decline, particularly in parts of our market-sensitive businesses, we’ve taken some actions to adjust capacity and with that comes a cost associated with it,” Chief Financial Officer Mark Mason said on a conference call with reporters, Bloomberg reported. 

Dive Insight:

Citi has more riding on its cards than other banks — it's the world's largest credit-card issuer. Success in that segment of the business stands as somewhat of a relief in a tumultuous quarter.

But the bank also has far less of a physical presence as other banks of its size — about 700 branches in the U.S., compared with roughly 5,000 for JPMorgan Chase and 4,300 for Bank of America. 

Citi added about $2 billion of deposits in the third quarter from its digital banking efforts, the company said Tuesday. That digital-first strategy has brought in roughly $4 billion of consumer deposits so far this year — and two-thirds of that total comes from outside of its traditional branch footprint, American Banker reported.

Some of the bank's other indicators are hit-or-miss. The company cut its expectations for annual net interest income, Bloomberg reported. That figure will now increase between 2% and 3% this year, the bank said, adding that the lower expectations should be offset by higher fee income.

"Despite an unpredictable environment throughout the quarter, we continue to deliver on our strategy," Citi CEO Michael Corbat said Tuesday, announcing the results.

The bank is reducing its head count by about 4%, which has helped the bank reduce expenses for the year. But that figure is still up 1% for the third quarter. Mason, the CFO, told Bloomberg the bank is managing its travel and event costs. 

The earnings statement came with some surprises. A 7% jump in debt underwriting led Citigroup’s investment bankers to post an uptick in revenue. 

And the bank got a break on its taxes. Citi's effective tax rate for the quarter was 18%, down from 24% at the same point last year. Citi took in a $180 million benefit from reducing its valuation allowance tied to its deferred tax assets, according to American Banker. That boosted earnings by 10 cents per share.

"We will help our clients navigate these choppy waters," Corbat told Bloomberg.