Citigroup Inc. (NYSE: C) reported a 6% increase in earnings for the third quarter of 2019 helped by the lower effective tax rate and higher revenues despite higher expenses and cost of credit. The results exceeded analysts’ expectations.

Net income increased by 6% to $4.91 billion, while earnings per share grew by 20% to $2.07 on lower average diluted shares outstanding and a decline in the effective tax rate.

Citigroup (C) Q3 earnings top estimates

Revenue rose by 1% to $18.57 billion driven by the gain on the sale of an asset management business in Mexico in Global Consumer Banking (GCB). Excluding the gain on sale, revenues increased by 2% reflecting solid performance across both GCB and the Institutional Clients Group (ICG).

ICG revenues rose by 3%. The strong client engagement and growth in transaction volumes drove Treasury and Trade Solutions revenue higher. The continued strength in debt underwriting and solid results in advisory, particularly in EMEA, drove Investment Banking. The higher lending and deposit volumes as well as higher investment activity, with both new and existing clients, led to higher Private Bank revenues.

Citigroup’s allowance for loan losses increased to $12.5 billion at quarter-end from $12.3 billion at the end of the prior-year period. Total non-accrual assets fell by 6% to $3.8 billion. Consumer non-accrual loans dropped by 8% to $2.2 billion and corporate non-accrual loans declined by 1% to $1.5 billion.

Read: BlackRock Q3 earnings review

The end-of-period loans grew by 4%, excluding the impact of foreign exchange translation, driven by 5% aggregate growth in ICG and GCB. In constant dollars, Citigroup’s end-of-period deposits increased 9% driven by 11% growth in ICG and 5% growth in GCB.

The company has been pressurized by low-interest rates. For reducing the chances of the economy slipping into recession, the Federal Reserve intends for two rate cuts during the third quarter. The corporate lending slowdown and trade war concerns hurt the company’s trading activities, which were impacted by a sluggish environment.

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