In a report that was somewhat similar to that of Bank of America, JPM reported Q4 revenues of $23.4 billion, beating estimates of $23.1 billion, on EPS of $1.71, far higher than the expected $1.42, which however like in the case of BofA was due to a cut in expenses, which came in at $6.87 billion, far below the $7.2 billion, suggesting even greater expense – i.e. compensation – reductions.
The “U.S. economy may be building momentum”: CEO Jamie Dimon said, adding that “opportunity for good, rational and thoughtful policy decisions to be implemented, which would spur growth, create jobs for Americans across the income spectrum and help communities”; JPM is well-positioned “to play our part.”
The CEO adds that the firm had double digit growth in deposit, core loan balances, with record credit card sales volume, continued momentum from 3Q in CIB, with strong markets results “across products.” Grew market share in “virtually all” businesses, “showed expense discipline while continuing to invest for the future”
The bank repurchased $2.1 billion in shares in the quarter.
While JPM’s net Interest Income was up $553mm YoY and up $163mm QoQ, this happened even as NIM declined by 2bps QoQ. That said, like BofA, JPM said it expects firmwide net interest income to be up “modestly” QoQ.
Net revenue in mortgage banking declined to $1.69b vs $1.87b q/q, while card, commerce solutions, auto net revenue also slipped to $4.56b vs $4.74b q/q.
On the key, trading side, JPM reported that while investment banking revenue rose by $17mm Y/Y to $1.49 billion, it missed expectations of $1.59bn, and while FICC of $3.37 billion rose by $795 million, beating expectations of $3.26 bn, equity markets revenue of $1.15 billion came in weaker than the $1.29 billion expected.
Some details from the report:
- IB revenue of $1.5B, up 1% YoY, driven by higher debt underwriting fees, largely offset by lower advisory and equity underwriting fees
- Fixed Income Markets of $3.4B, up 31% YoY, driven by strong performance across products
- Equity Markets revenue of $1.2B, up 8% YoY, driven by strong performance in derivatives
The better than expected net income in the investment bankin group was mostly the result of a big drop in expense of $4.2B, which was down 6% YoY, driven by lower compensation and lower legal expense.
Another highlight: net charge offs in the bank’s credit card services group jumped from $838 million to $914 million, the highest since Q2 2013.
Finally, JPM’s loan loss reserves of 13.8B rose $0.2B from $13.6B in the prior year.
Full presentation below:
The post JPM Earnings Jump On Slashed Expenses, FICC Trading Beats As Equity, IB Misses; Credit Card Charge-Offs Spike appeared first on crude-oil.top.