Citigroup Inc. today reported net income for the second quarter of US$6.23 billion, up 18%.

International revenues and net income were both at record levels too, up 34% and 35%, respectively. Return on equity was 20.1%. Revenues were a record, up 20%, led by the growth in international revenues. International markets & banking revenues grew 50%, international consumer revenues increased 16%, and wealth management revenues more than doubled.

Revenue growth reflected double-digit customer volume growth. Deposits and loans grew 20% and 17%, respectively. In global wealth management, client assets under fee-based management grew 40%, and client capital in alternative investments increased 55%. Strong volume growth drove a 16% increase in net interest revenues.

Operating expenses also increased 16%, driven by increased business volumes and acquisitions, which were partially offset by savings from structural expense initiatives announced in April, and the release of US$300 million of litigation reserves reflecting continued progress in favorably resolving WorldCom/Research matters.

Credit costs increased US$934 million, primarily driven by an increase in net credit losses of US$259 million and a net charge of US$465 million to increase loan loss reserves. The US$465 million net charge compares to a net reserve release of US$210 million in the prior-year period.

“We have very clear priorities to drive growth and we are executing on all of them. We generated record revenues, up 20%, and record earnings from continuing operations, up 18%, both driven by our record international results,” said Charles Prince, Citi chairman and CEO, in a release.

“We continued to generate revenue and volume growth in our U.S. consumer franchise, while making excellent progress in re-weighting Citi toward our other businesses, especially our international franchises, where revenues and net income increased over 30%. Our capital markets-driven businesses performed extremely well and international consumer revenues and volumes grew at a double-digit pace,” said Prince.

“We also began to implement the structural expense initiatives announced in April, which are generating improved efficiencies. These initiatives, coupled with strong revenue growth, drove positive operating leverage this quarter and helped offset increased credit costs,” Prince added. “We made excellent progress in expanding our business through targeted acquisitions, completing three international transactions, including an increase in our ownership of Nikko Cordial Corporation in Japan to 68%.”