July 19, 2009
investment, bank
JPMORGAN said investment banking and trading achieve a 36 percent jump in quarterly profit.
Though the second-largest U.S. bank is widely considered the nation's major lenders, it added US$2 billion to credit reserves in the quarter and set aside more than twice as much as a year earlier for bad loans. It said credit quality in consumer mortgages was deteriorating faster than it expected.
CEO Jamie Dimon said the bank had great confident that its capital, reserve levels and earnings power were solid despite a "difficult economic environment".
Second-quarter net income rose to US$2.72 billion, the bank reported Thursday. Net revenue jumped 41 percent to US$27.71 billion.
Profit per share fell to 28 cents from 53 cents as the number of shares outstanding increased.
Analysts on average expected profit of 4 cents per share on revenue of US$25.91 billion, according to Reuters Estimates.
The results followed better-than-expected earnings posted Tuesday by Goldman Sachs Group Inc., Bank of America Corp. and Citigroup Inc., JPMorgan's main rivals, may fare less well when they report results, expected Friday.
"It looks like good, strong numbers and it looks pretty broad-based," said Michael Hecht, an analyst at JMP Securities. "We are in an increasing world of haves and have-nots, and we know where JPMorgan and Goldman fall."
JPMorgan last month repaid US$25 billion taken from the TARP. It has said it will let the Treasury Department auction the attached stock warrants, rather than pay an inflated price to buy them back.
Second-quarter results included per-share charges of 27 cents relating to the TARP repayment and 10 cents to bolster a federal deposit insurance program.
JPMorgan shares rose 18 cents to US$36.44 in premarket trading. Through Wednesday, the shares were up 15 percent this year, compared with a 14.4 percent drop in the KBW Bank Index.