Monday 19 March 2018

Boost for financial quarter after Citibank reports surge in profits

Donal O'Donovan

Donal O'Donovan

DUBLIN'S financial quarter has been buoyed by surging profits at its biggest employer, Citi, and speculation of a jobs boost at State Street -- with the company tipped to buy a hedge fund unit from Goldman Sachs.

US giant Citibank paid €94m in Irish corporation tax last year, after profits at the bank's IFSC-based unit soared to €755m, according to accounts just filed with the Companies Office.

The accounts are for Citibank Europe Plc, an Irish-headquartered subsidiary of the global bank. Citibank is among the biggest employers in Dublin's IFSC with around 2,000 staff at its North Wall headquarters.

Citi's pre-tax profits rose to €755m from €557m in 2010. Profits for the year after tax were €655m, up 43pc from 2010.

The news comes as speculation mounts that the IFSC could see a further jobs boost if State Street -- the next biggest employer in the financial district -- seals a deal to buy Goldman Sachs' asset-management arm.

The cost of doing business here fell last year, according to the Citibank directors' report filed for Ireland.

The directors state that a key performance measure known as the cost versus income ratio shows costs at the Irish headquartered unit account are equal to 38pc of income -- compared with 65pc across Citigroup as a whole.

The 14 directors of the Irish-based business shared €3.8m in pay last, around €270,000 each on average.

The bank's significant corporation tax contribution is in contrast to more recent US arrival Google.

The internet giant reported turnover of more than €10bn last year at its Irish operation, but paid just over €5.6m in corporation tax, which is based on profits rather than revenues.


Citi's Irish business is the headquarters for a number of operations in eastern Europe, but the accounts just filed show that Ireland contributes the vast bulk of profits for the entire unit.

Branches in the Czech Republic, Hungary, Slovakia and Romania contributed €143m to last year's pre-tax profits compared with more than €600m from Dublin. Net income across the company was €1.2bn in 2011, according to the accounts.

Citi has been in Ireland since the 1960s, but developed a major presence after relocating to the IFSC in 1996.

Last year, the bank expanded with the lease of additional office space at the EastPoint Business Park, also in Dublin, with plans to further boost job numbers by as many as 250.

State Street is also understood to be looking to secure a major new office space for itself in Dublin in order to consolidate offices spread across the city into a single base.

Irish Independent

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