NEW YORK– JPMorgan Chase reported higher second-quarter earnings on improved investment banking results and Visa shares, although profits were hurt by higher loan loss costs.
Net profits at the largest US bank amounted to $18.1 billion, up 25% from the same period last year. They were boosted by an exceptional gain of $7.9 billion from a stock swap transaction with Visa.
Reported revenue rose nearly 22% to $50.2 billion and assets under management increased 15% to $3.7 trillion.
Net income
Net interest income (NII) reached 22.9 billion dollars, almost the level expected by market consensus (22.78 billion).
The largest U.S. bank by assets highlighted rising investment banking and asset management fees as well as an increase in net interest income, which is based on the interest JPMorgan earns on loans minus the interest it pays to depositors.
Taking into account the price per share and excluding exceptional items, the profit was 4.40 dollars, when the consensus of analysts compiled by the financial data firm Factset expected 4.20 dollars.
In addition, it recorded a total turnover of 50.99 billion dollars (+20%),
“These results are exceptional and represent a record for turnover and net profit,” said Jeremy Barnum, the group’s financial director, to journalists.
“But more importantly, after excluding exceptional items, underlying performance remains quite solid,” he said.
Chief Executive Jamie Dimon said the bank had performed “well” in the quarter but reiterated concerns about the outlook.
“While market valuations and credit spreads appear to reflect a fairly benign economic outlook, we remain vigilant about potential rebound risks,” Dimon said, reiterating concerns about geopolitical tensions and the risk that inflation and interest rates will remain high.
Citigroup results
For its part, the American bank Citigroup recorded better results in all its business areas in the second quarter and showed signs of recovery at a time when the company is immersed in a deep strategic reform.
According to a statement issued by the bank on Friday, net profit amounted to $3.22 billion, up 10% year-on-year.
The most closely watched parameter on Wall Street, the stock market, is trading at $1.52 per share, above the $1.41 forecast by analysts, according to a consensus compiled by financial data firm FactSet.
The New York banking institution closed the quarter with higher revenues and profits than in the same period last year in each of its main activities, except for the net result of the retail banking sector.
In total, sales rose to $20.1 billion, 4% more than the same period a year earlier.
Citigroup is undergoing a major restructuring, centered on exiting overseas retail banking to focus solely on corporate banking, asset management and investment finance.
In this regard, it plans to eliminate 7,000 jobs this year and 20,000 in total in the medium term, going from 200,000 to 180,000 employees.
Source: With information from AFP.