Citigroup Inc reported lower fourth-quarter profit while Wells Fargo & Co. said profit rose. Both big banks said their quarters were helped by declining bad loan costs.

Citi, the third-largest U.S. bank by assets, reported net income of $1.2 billion, or 38 cents a share, down from $1.3 billion, or 43 cents a share a year earlier.

Wells, the fourth-largest U.S. bank, said net income applicable to common shareholders was $3.9 billion, or 73 cents per share, compared to $3.2 billion, or 61 cents per share, a year earlier.

Below are comments from analysts and investors:

JEFFREY SICA, PRESIDENT AND CHIEF INVESTMENT OFFICER, SICA WEALTH MANAGEMENT, INDEPENDENT WEALTH MANAGER, MORRISTOWN, NJ: We see this as a very negative reflection on (Vikram) Pandit's ability to run Citigroup. Obviously what makes these earnings so horrendous, so disgraceful is (Citi) reported 38 cents vs the consensus view of 48 cents. But what makes it even worse is that just 60 days ago that consensus estimate was in the 80 cent range. Expenses accelerated from last quarter. They're blaming it mostly on bond trading, which does not bode well for the future because things just won't get better in that arena.

Wells Fargo has a better business model for the environment we're in now because commercial lending is their biggest sector. They're not overly involved in the trading activities that the other banks are involved in. Although they were able to beat estimates, and although they're the best of the worst, I think they're going to see downward pressure from more continued slowing economic growth.

TODD SCHOENBERGER, managing director, LandColt Trading, Wilmington, Delaware: Citi's number to come in like this, still missing even though estimates were already cut, that's a cause of great concern. Wells Fargo is decent, but in order for the market to do well, we need the big banks to do well. So this is cause for great concern, and Goldman's number tomorrow could be the catalyst to really get us worried.

MARTY MOSBY, large-cap bank analyst, Guggenheim Partners, Memphis, Tennessee: We're seeing continued progress in Wells Fargo. Earnings continue to move northward and there's still growth. We saw 2 percent sequential growth in core loans, which is nice to see. There was also an improvement in net interest margin, which had been a big concern. On the disappointing side, the expense number was higher. We were looking for greater efficiency.

DEREK PILECKI, portfolio manager, Gator Capital Management (long-short hedge fund), Tampa, Florida: Citi's results reflect the weak capital markets environment in the quarter but it looks like they're making progress in building capital and their credit is continuing to improve.

BRUCE FOERSTER, president, South Beach Capital Markets, Miami: Vikram Pandit ought to get out in front of Glass-Steagall and spin off the investment bank. Commercial banking isn't as complicated. A spinoff would create a lot more value and allow the big retail and C&I loan business to flourish. I think he's cleaning it up big time. Citi is a long-term bet, but a very good bet.

Wells Fargo is carrying the burden of Wachovia and World Savings on mortgages, but it has an incredible retail brokerage franchise. They beat, and I'd like to see the Fed let them up the dividend.

Citigroup