Three government rescues and billions in losses later, Citigroup Inc.'s (C) quarterly loss contracted to $966m, or 18 cents per share in first-quarter 2009, the company said Friday morning. That's down from a loss of $5.19bn, or $1.03 per share, a year earlier. Citi's first-quarter revenue jumped 99% year-on-year to $24.79bn. By contrast, bank analysts expected a loss of 30 cents per share on revenue of $21.73bn, according to Thomson Reuters. But the banking giant posted a larger than expected first-quarter income of $1.6bn, driven primarily by improved performance in institutional clients group and continued expense reductions, the bank said. Its operating expenses fell 23 percent from the first quarter of 2008 and its work force has been cut by about 13,000 since fourth-quarter 2008. Citi holds $135.2bn in first mortgages and $57.8bn in second mortgages. However, the amount of note losses on subprime and Alt-A mortgages are coming more into control at the bank. Direct subprime exposure fell from $14.1bn to $10.2bn. And concerning Alt-A, the bank posts $3.5bn in writedowns during the quarter, with $18.8bn in held to maturity/available for sale properties and $3.1bn in the trading book, the majority of which are held in mezzanine  and equity tranches from the 2006 vintage. Exposures to the rapidly fading monoline industry and structured finance products funding long-term debt with short-term paper, such as Structured Investment Vehicles, decreased greatly of the course of the year as well. The release of the numbers contrast to the fact Citigroup lost $37.5bn in the last five quarters, and Pandit says the latest results were the best in nearly two years. "We have lowered risk and dramatically reduced the problem legacy assets that have caused many of our losses," he said. In January, Pandit split Citigroup into Citicorp and Citi Holdings, which includes brokerage and insurance units, bad debt and other assets that it wants to shed. Write to Kelly Curran at kelly.curran@housingwire.com. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments.