For the first time since 2007, Citigroup (C) reported annual profits in its end-of-year earnings statement, released Tuesday along with the bank’s fourth-quarter 2010 earnings. Annual earnings posted at $10.6 billion, or $0.35 per share, while quarterly earnings came in at $1.3 billion.

Citigroup in its news release cited lower losses on troubled loans but poor investment banking results, reporting earnings per share of $0.04—which disappointed analysts’ expectations for EPS of $0.08. Citigroup reported a $0.33 loss in Q4 2009 but saw profits in every quarter of 2010.

CEO Vikram Pandit, who assumed his role in 2007, had failed until now to turn an annual profit. During the worst of the country’s financial meltdown, 2008, Citigroup was at the top of the taxpayer bailout list and reported a whopping $18 billion loss. The bank followed that abysmal performance with a loss of $1.6 billion in 2009, or $0.80 per share.

“2010 was a year full of milestones and was critical for the turnaround of this institution,” Pandit (left) said in a statement. “Our core businesses in Citicorp, with its deep roots in both the developed and emerging markets, performed well throughout the year while we made targeted investments in talent and technology. At the same time, we continued to wind down Citi Holdings in an economically rational manner, reducing assets by $128 billion in 2010 alone.”

While full-year revenue fell 5% to $86.6 billion from $91.1 billion a year ago, largely due to weak bond trading revenue, quarterly revenues for Q4 came in at $18.4 billion versus only $7.9 billion in Q4 2009. That weak performance was salvaged somewhat by fewer credit losses, which stood at $30.8 billion in 2010 compared to $42.2 billion in 2009.

Private Bank revenues were $501 million, up $4 million, or 1%, sequentially, mainly driven by higher client business volumes.

The Brokerage and Asset Management unit reported a fourth-quarter net loss of $52 million versus a loss of $153 million in the third quarter and a year-ago profit of $31 million.

The sequential improvement was mainly driven by an increase in revenues, which were reported at $136 million in the fourth quarter versus a loss of $8 million in the third. The increase in revenues was principally due to a higher contribution from the Morgan Stanley Smith Barney joint venture.

Read about Citigroup’s Q3 2010 earnings at

Read AdvisorOne's 2010 Q4 earnings calendar for the financial sector for release dates and links to earnings stories.