There were many reasons why Citi-group's earnings for the second quarter, released on July 14th, might have elicited familiar groans. Revenues from its North American retail operations plunged by 26%, thanks in part to an abrupt drop in the refinancing of mortgages due to rising interest rates. Worse, the bank agreed to a $7 billion settlement with prosecutors over its dealings in mortgage-backed securities before the financial crisis, twice what analysts had initially expected and 20 times what Citi had first offered. Yet in the wake of all this bad news, Citi's shares rose. In part, that is because Citi's troubles are, for the most part, reassuringly typical of American banks. Wells Fargo, America's biggest bank by valuation, had previously announced its first decline in earnings per share since the financial crisis thanks largely to the refinancing drought. By the same token, Citi's income from trading bonds, currencies and derivatives fell no more dramatically than that of its rivals.
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